Scam

PotNetwork Holdings Inc – Multimillion Investor Scam

PotNetwork Holdings Inc is a dangerous cannabis firm involved in a large-scale money laundering case. Their past president Charles Vaccaro was working with two other criminals to manipulate the POTN stock price illegally. 

His partner in crime, Eli Taieb is still a major shareholder in PotNetwork Holdings Inc. The following review will give you a detailed overview into this fraud organization: 

About The PotNetwork Holdings Inc Stock

PotNetwork Holdings Inc claims to be a holding company for multiple subsidiaries. They claim to focus on researching, developing and promoting premium hemp extracts with various hemp derivatives and cannabinoids. 

Their stock symbol is POTN. The company posts various press releases to promote the POTN stock price. Their most popular subsidiary is Diamond CBD Inc. 

Currently, the POTN stock forecast is quite bleak as the current POTN stock price is $0.001. It has moved by -97.15% in the past year, which is a substantial amount. 

The common consensus on this cannabis company is it can go bankrupt at any time. Hence, the POTN stock forecast is quite negative. 

The main reason why the stock price of this firm is going down is because of their recent involvement in a multi-million fraud. I have explained that PotNetwork Holdings scam in detail: 

PotNetwork Holdings Inc Lawsuit: Criminal Stock Manipulation & Defrauding Stock Holders

PotNetwork Holdings Inc exposed

Recently, FBI had performed a sting operation and arrested three individuals for wire fraud, conspiracy and securities fraud. The FBI agents posed as criminals willing to funnel the culprits’ illegal stock gains into US accounts.

The people arrested were Dror Svorai, Eli Taieb, and Charles Vaccaro. But that’s not the main highlight. The stocks they were using in their scheme were Whilte Label Liquid (WLAB), Vaper Group (VPOR), and PotNetwork Holdings (POTN). 

Dror was even assigned a GPS tracking ankle bracelet. Those criminals were using their private investment firms to make PIPE investments in specific stocks. And they owned up to nearly 20% of the company by using this tactic. 

A PIPE investment is a public investment in a private firm done through a debt investment that transforms to common stock when the company fails to pay the high interest loan. Another popular name for such investments is death spiral because it enables investors to get tons of shares with significantly small investments. 

Dror, Charles, and Eli were able to use this strategy to invest as an undisclosed group. This prevented public shareholders to find out how much stock this trio owned. 

Charles Vaccaro controlled PotNetwork Holdings Inc. Their strategy was to liquidate nearly $100 million in stocks and process it through a foreign brokerage account to avoid getting attention from the SEC. 

The culprits aimed to spend up to $200,000 on paid promoters who would pump the stock once their shares converted. Then, the foreign brokerage accounts would sell their shares at the pump’s peak to liquidate $1 million shares per week. And they would earn a 20% clearing fee. 

Afterwards, the people handling the foreign brokerage accounts had to launder the rest of the profits into nominated US bank accounts. 

The FBI had planted undercover agents who claimed to handle the foreign brokerage accounts. This allowed the federal agency to uncover the scam related to PotNetwork Holdings Inc. 

Those guys were going to hire the Awareness Consulting Network, a third-party payer. ACN has multiple companies that promote specific stocks. They include AwesomeStocks.com, ProtraderElite.com, and SmallCapFirm.com. 

How did Charles Vaccaro control PotNetwork Holdings Inc? He was the past president of the firm and he was sued by a hedge fund manager for controlling the firm behind the scenes. PotNetwork Holdings Inc had taken a loan from the hedge fund manager but didn’t pay it back. 

Charles was using this method in many cases and this hedge fund manager from Southridge Capital wasn’t an isolated case. 

The SEC allows promoters to write positive stock reviews under the condition that they will disclose who paid them. By using a third-party payer (ACN), Charles and his partners were able to hide their identities in this process. 

Through their illegal stock promotion tactic, Charles and his partners had boosted the PotNetwork Holdings stock price in 2018 from $0.06 to $0.85. Experts questioned this sky-rockething rise in the share price. They questioned the SEC filings of PotNetwork Holdings Inc as the cannabis firm didn’t submit sufficient information, reflecting poorly on the company. Keep in mind that prior to their SEC filing in 2018, PotNetwork Holdings used to trade as a cannabis penny stock. 

Experts were concerned on how a small cannabis firm can reach such high valuations for no apparent reason. Certainly, it was an indication that PotNetwork Holdings Inc was involved in something illegal. 

Twisted Past of PotNetwork Holdings President

Charles Vaccaro, the man who was controlling PotNetwork Holdings Inc from behind the scenes has a very shady past. He used to run a broker dealer firm called FI trading which FINRA expelled in 2003. Then, Charles didn’t pay a customer dispute award in 2015 causing FINRA to take away his broker dealer license. Some clients alleged that he was taking funds from his clients when he worked as a broker dealer.

He spent the money he generated from his illegal deals of PotNetwork Holdings stocks on a 70-foot Azimut yacht made in Italy. Charles named his yacht C-Weed. 

He set it up under his name in 2017 and was charged with multiple misdemeanours with the boat. Apparently, his boat was leaking waste into Lake Montauk as no one pumped out its toilets. Police also found that the State of Florida had outstanding charges against the PotNetwork Holdings president for unpaid taxes. 

Public Opinion on PotNetwork Holdings Inc: 

The news of this scam broke out like wildfire. Plenty of traders and investors realized how big of a scam PotNetwork Holdings is. Many people highlight it as a long-term scam and nothing else. 

Some investors even suspect that this cannabis firm can go bankrupt at any time. 

PotNetwork Holdings Inc: Verdict

Charles Vaccaro was using PotNetwork Holdings Inc to steal funds from investors. Now that the FBI has uncovered his scam, the stock price of this cannabis firm is going downhill. 

You should also be wary of such a firm that’s at the risk of going bankrupt any time. There are plenty of other cannabis companies you can invest in. So, avoid PotNetwork Holdings Inc. 

2.5Expert Score
A Scam

PotNetwork Holdings Inc is a scam. Its owner was caught in an FBI sting for manipulating its stock prices and laundering money through foreign brokerage accounts.

Trust
2.5
Experience
3
Ethics
2.5
Stock Performance
2
Pros
  • None
Cons
  • Multi-million stock manipulation scam
  • Money laundering operation
  • Uses black-hat tactics to bury news
  • Poor stock performance
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