crime Archives - Green Market Report

Dave HodesApril 27, 2022


When discussing the many social issues facing the U.S., one stands out—the war on drugs, which still haunts the law enforcement system today as it continues to incarcerate non-violent minor drug crime offenders even in states where a Schedule 1 drug (cannabis) is legal. 

Reform is coming on this issue. In the November 3rd, 2020 election, drug policy reforms were approved by voters in every state in which they were on the ballot, according to the National Association of Criminal Defense Lawyers.

But for now, too many people are crowding prisons and jails in the U.S.

The statistics tell the whole story. There are almost 2 million people in 1,566 state prisons, 102 federal prisons, 2,850 local jails, 1,510 juvenile correctional facilities, 186 immigration detention facilities, and 82 Indian country jails, as well as in military prisons, civil commitment centers, state psychiatric hospitals, and prisons in the U.S. territories. 

The U.S. spends nearly $300 billion annually on local, state and federal justice systems.

Drug offenses still account for the incarceration of almost 400,000 people, and police still make over 1 million drug possession arrests each year, many of which lead to prison sentences. 

But now, some of the same psychedelics that could get someone sent to prison—most of which are listed as having a high potential for abuse, and serving no legitimate medical purpose, according to the National Drug Intelligence Center—may actually help keep the people who consume them out of prison.

Use of hallucinogens helped criminals get and stay on the straight and narrow, according to a study, once out of prison and under supervision. They may also promote alcohol and other drug abstinence, and prosocial behavior.

What’s more, evidence suggests that hallucinogens may have therapeutic potential for addressing a variety of problem behaviors such as substance misuse and criminality, according to another study

One such behavior, intimate partner violence, is a prevalent form of criminal violence. But among 302 inmates at a U.S. county jail in the study, it was found that hallucinogen use predicted reduced arrests for intimate partner violence, suggesting that there were was a distinct therapeutic potential for hallucinogens to reduce problematic behavior.

According to yet another study in 2022, lifetime psilocybin use was associated with lowered odds of past year arrests. Peyote was associated with reduced odds of motor vehicle theft, and mescaline was associated with reduced odds of drug possession/sale.

The study concluded that the use of classic psychedelic substances is associated with lowered odds of crime arrests, and called for additional research about the relationship between classic psychedelic use and reduced criminal behavior.

An earlier study had similar results, testing the relationships of classic psychedelic use and psilocybin use per se with criminal behavior among over 480,000 U.S. states adult respondents. 

In this 2018 study done by the University of Alabama at Birmingham (UAB), lifetime classic psychedelic use was associated with reduced odds of larceny/theft, assault, arrest for a property crime, and arrest for a violent crime. 

Peter Hendricks, the associate professor in the Department of Health Behavior at the UAB School of Public Health who led the study, reported that his team’s findings, coupled with both older and emerging bodies of evidence, make a case that classic psychedelics may provide enduring benefits for criminal justice populations. “Our findings suggest the protective effects of classic psychedelic use are attributable to genuine reductions in antisocial behavior rather than reflecting improved evasion of arrest,” he said. “Simply put, the positive effects associated with classic psychedelic use appear to be reliable. Given the costs of criminal behavior, the potential represented by this treatment paradigm is significant.”

Caroline CahillApril 26, 2019


A Massachusetts cannabis investment scheme has resulted in charges for an investment adviser who allegedly swindled more than $8 million from investors.

On April 17, 2019, Massachusetts Sec. of State William F. Galvin announced charges against Frederick V. McDonald, Jr., CEO of US Advisory Group Inc. McDonald is accused of misleading more than 100 investors in a Massachusetts cannabis investment scheme, with one 78-year-old investor losing more than $3 million.

McDonald’s house of cards was built with three main ventures—US Advisory Group, Commonwealth Pain Management Connections LLC, and Kettle Black of MA LLC. Through these vehicles, McDonald used clients’ funds in a failed attempt to gain medical cannabis dispensary licenses in Massachusetts and violated state securities laws in the process.

According to the filing, McDonald acting as an investment advisor made recommendations to a high net worth client directing him to invest in marijuana projects without disclosing McDonald’s controlling interest in the investment vehicle or the fees he would receive in connection with the projects.

He originally met the investor at the World Presidents’ Organization Retreat in 2007 and got him to sign an advisory agreement. He got him to invest $1 million into Prime Wellness of MA. Instead of going after the medical marijuana license, McDonald took $200,000 and invested it in Dixie Highway Partners, a different entity owned by McDonald.

He never got a license for Prime Wellness and started a new investment vehicle called KBMA in which he raised $8 million. Ultimately, the venture never obtained a license and had a falling out with the property owner for the proposed dispensary. The whole deal fell through and the investors lost all their money. The original investor ended up losing $3 million and the other investors lost the $8 million for KBMA.

As documented by the state’s 35-page administrative complaint, “McDonald’s free-wheeling practices included cutting corners at every opportunity and lying to his own business partners and investors to cover his own mistakes.”

The complaint details McDonald’s failure to uphold his fiduciary duty, and how “[he] further failed to educate himself regarding the unique and complex licensing process in Massachusetts, which resulted in the distribution of offering documents that failed to adequately disclose to investors the risks or difficulties the investment could face.”

The Massachusetts Securities Division wants to bar McDonald from practicing as an investment adviser and require him to pay a fine to the state and restitution to investors, among other requested enforcement actions.

While McDonald has been accused of misusing investment funds, making material omissions, and other unethical conduct and practices, a representative from US Advisory Group has denied the state’s allegations.

“We have always acted with the highest level of ethics and in the best interests of our clients,” stated the USAG representative, as reported by the Boston Herald. “News reports do not accurately reflect US Advisory Group’s core, history and legacy of providing exceptional financial planning and advice.”

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