*Willard Jackson, former head of Ebony, was forced out last year amid allegations of financial impropriety.
He is now among a group of people charged by the SEC with using cash raised for a marijuana business to cover the operating costs of the magazine, an illegal move as reported by Marketwatch.
According to the report, Jackson is accused of conspiring with Robert Shumake, 53, and Nicole Birch in the criminal crowdfunding enterprise.
Here’s more from the outlet:
Willard Jackson, 57, is accused of taking part in a scheme that crowdfunded nearly $2 million for a series of marijuana-related real estate ventures, but whose principals kept the money for themselves, according to civil charges brought by the Securities and Exchange Commission. At the center of the enterprise was Robert Shumake, 53, who the SEC says kept his name hidden from investors due to criminal convictions for fraud in the past, but actually hatched the scheme and was instrumental in directing cash away from its intended purposes. The SEC said that Shumake and Birch raised $1.020 million from retail investors through Transatlantic Real Estate, and that Shumake and Jackson raised $888,000 through 420 Real Estate. The three then allegedly used the money for their own purposes.
Jackson was ousted from Ebony in July 2020.
“Crowdfunding offerings enable issuers to cast a wide net for potential investors, emphasizing the importance of full and honest disclosure,” said Gurbir S. Grewal, director of the SEC’s division of enforcement. “As companies continue to raise funds through crowdfunding offerings, we will hold issuers, gatekeepers, and individuals accountable and enforce the protections in place for all investors.”
The SEC’s complaint was filed in federal court in the Eastern District of Michigan. Shumake, Birch and Jackson are charged with “violating anti-fraud and registration laws and seeks financial penalties and injunctions barring them from serving as corporate officers,” the outet writes.