Illegal online cannabis sales targeted by BC government lawsuit

Those behind the websites, who held no license to produce or sell cannabis, then laundered the cash through a web of numbered companies and personal accounts

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Three BC websites selling illicit cannabis received e-transfers totaling more than $6.4 million in just over two years, according to a new lawsuit filed by the director of civil forfeiture.

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Those behind the websites, who held no license to produce or sell cannabis, then laundered the cash through a web of numbered companies and personal accounts, the director alleged in the Aug. 4 statement of claim.

The provincial government wants eight properties worth almost $7 million forfeited as proceeds of crime. And it wants to keep cash currently held in 26 accounts at five different banks — some personal and some linked to the companies allegedly involved.

The lawsuit comes less than two months after BC Supreme Court Justice Austin Cullen said in his final report into money laundering that the Civil Forfeiture Act should be used more aggressively to go after the assets of those involved in organized crime.

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Ten people and three companies have been named as defendants in the lawsuit, although several others are alleged to have laundered funds from illicit cannabis sales before sending the cash back to the defendants.

Defendants Jay Jung, Kevin Aaron Chow, and Benjamin Tyler Johnson are directors of two companies that had owned two Freshii restaurants on the Lower Mainland. They allegedly deposited some of the pot profits into their corporate accounts, the lawsuit says.

Jung, Johnson, Matthew Douglas George, Monet Helen Beswick and Josef Shechter “have owned and/or operated cannabis business called Shamrock Cannabis, Cankush and Mountain High Marijuana, each of which offers cannabis products for purchase on its website,” the director said.

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“At no material time has any of the three companies been authorized by Health Canada or by the British Columbia Liquor Control and Cannabis Branch to produce, possess for the purpose of distribution, distribute, possess for the purpose of selling, sell, promote the sale of, and or supply cannabis products.”

From April 2020 to early 2021, the three companies operated out of a unit at 1355 Parker St. before moving operations to 329 Railway St. in Vancouver, the suit says.

The Railway unit is leased to Nature’s Bodega Natural Products, a company that lists the same five names as directors on its corporate records.

All five “regularly attended the Parker site” until last year. “Since early 2021, they have regularly attended the Railway site,” the director says.

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All five “and other individuals working under their direction have regularly transported cannabis products and packaging to the Parker site and the Railway site, packaged cannabis products purchased by customers on the websites of the three cannabis companies at the Parker site and the Railway site using prepaid Canada Post envelopes and transported these packages to the Yaletown Xpress Canada Post outlet … to be mailed to customers.”

None of the three websites is currently operational.

A woman answering the phone at Nature’s Bodega on Monday said she knew nothing about the allegations, but that the Railway office is used to ship out health and beauty products only.

“I don’t know what you’re talking about, unfortunately,” she said. “We’re just a fulfillment center here. So we have all of just our Nature’s Bodega products that we ship out.”

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An emailed request for comment from the company’s management was not answered.

And an employee at one of the Freshii restaurants that had been owned by Jung said Monday that the franchise had switched ownership — something confirmed by local business license records.

The lawsuit lists 14 “laundering accounts” that received the e-transferred funds — most of them connected to people or companies not listed as defendants in the case.

“Most or all of the funds deposited into the laundering accounts from sales of the three cannabis companies were then transferred or disbursed before ultimately being returned to the defendants Mr. Jung, Mr. Johnson, Mr. George, Ms. Beswick, Mr. Shechter, Man on the Moon Enterprises ltd., Summer Slopes Holdings Ltd. and/or 1167249 BC Ltd.”

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None of the defendants has filed a statement of defense, and none has been criminally charged.

Half of the 26 accounts containing cash the government wants forfeited are held by Jung or his Man On The Moon company. Two properties he owns or co-owns are among the eight the government wants to keep. Both were purchased last year.

“Jung has previously been convicted of two counts of possession of a controlled substance. He was subsequently arrested in possession of approximately three kilograms of cocaine,” the director said.

Other properties sought for forfeiture are in Vancouver, Langley, Anmore and Kelowna.

The director alleges they “were purchased in whole or in part with the proceeds of unlawful activity” or have been maintained by “laundering the proceeds of crime.”

[email protected]

Twitter.com/kbolan

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