Galvin plans sweep over pot-related investment fundraising

The Massachusetts Securities Division said it will begin a sweep of the growing number of business entities based in the state that are raising money from marijuana-related investments.

(More: Advisers struggle with the highs and lows of marijuana investing)

William F. Galvin, the state’s securities commissioner, said that his office is seeing an uptick in marijuana-related fraud cases and has issued guidance to investors who may be considering putting their money into the growing cannabis industry. The guidance comes after his office brought its second complaint involving marijuana in the last two months.

(More: Massachusetts charges adviser with concealing information in marijuana deals)

Massachusetts also has brought charges against David A. Caputo and his former company, Positronic Farms Inc. for raising capital through the offer and sale of unregistered securities to at least 25 Massachusetts investors, as well as investors in eight other states. Mr. Galvin recently charged another Massachusetts man in connection with an unlicensed medical marijuana scheme that resulted in the loss of millions of dollars of investor money.

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