JANESVILLE Hemp-derived THC merchant Jerry McCoy could face more than 130 years in prison in what prosecutors say is a scheme to sell massive quantities of cannabis thats considered illegal in Wisconsin. The Janesville man stands accused of falsely packaging, marketing and selling the material as hemp-derived THC products that would be legal in Wisconsin.
McCoy appeared via video from custody Monday on 13 counts of trafficking illegal THC. He was arrested five days earlier following police raids on a half-dozen of his 16 Hemp 1848 stores in Rock and Green Counties including his Janesville Hemp 1848 store in downtown Janesville, a block west of the Rock County Courthouse.
While McCoys attorney and his business associates maintain McCoy has done nothing illegal in selling hemp-derived THC, a Rock County prosecutor said Monday that McCoy has been running an incredibly large, complex drug delivery scheme, that involves fraud.
Prosecutors say the scheme has relied on the repackaging and sale of cannabis products that have a high concentration of Delta-9 THC a psychoactive chemical in cannabis that may be legal in states which have decriminalized or legalized cannabis, but remains illegal to sell or possess in Wisconsin in concentrated quantities.
According to a criminal complaint, police in an investigation and during raids last week on Hemp 1848 properties turned up nearly 90,000 grams of THC material between Janesvilles Hemp 1868 store at 30 S. Main St., and at a warehouse on Sharon Road.
Investigators believe based on testing the material, including edibles, cannabis flower, oils waxes and other materials, that much of the THC it contained had a high concentration, testing at or above 60% to 80% for Delta-9 THC.
That means the cannabis McCoy is suspected of marketing to customers was of a potency that well surpasses Wisconsins legal threshold limiting hemp-derived products to just 0.3% active Delta-9 THC.
The 2018 federal Farm Bill allows hemp products that have concentrations of Delta-9 THC less than .3% to be sold by retailers.
Prosecutors did not make clear who is thought to have produced the THC found in the products McCoy is suspected of possessing or selling, or where or how McCoy and his company procured it.
McCoy is suspected of assembling or making products using THC oils, waxes and other compounds with illegally potent Delta-9 THC, and putting the products in packaging that doesnt accurately show the products true potency and that misrepresent the material as otherwise as being legal to buy in Wisconsin.
A criminal compliant states investigators found equipment and ingredients used in filling vape cartridges and making edibles, and in some cases, evidence that vape cartridges have been filled by Hemp 1848 with THC strains and types not legal in Wisconsin, and loaded into vapes that Hemp 1848 then packaged in containers with marked falsely as Hemp-derived, THCA products legal to sell and buy in Wisconsin.
Police had been investigating McCoy and Hemp 1848 after police confiscated products that Hemp 1848 store workers said they were transporting in a vehicle to the warehouse because the products were expired.
Police said the products had a Delta-9 THC concentration that does not appear to be legal under Wisconsin provisions for retail sale of hemp-derived cannabis.
Rock County Court Commissioner Jack Hoag set bond for McCoy at $50,000, which is what the District Attorneys office asked for.
The prosecution pointed out that McCoy previously served 12 years of a 27-year federal prison sentence after being convicted in 2005 of drug trafficking in a large-scale cocaine ring in Madison.
The D.A.s office indicates McCoys past history makes him a flight risk.
McCoy had the cocaine trafficking sentence commuted and he was released in 2017 on good behavior.
He began selling hemp-derived products in Rock County out of a storefront in Edgerton in 2019, and has since expanded to 16 Hemp 1848 store locations in Rock and Green Counties, with retail stores in communities including Janesville, Beloit and Monroe.
McCoys retail company employs about 35 people, prosecutors said.
McCoys attorney, Milwaukee defense attorney Michael Torphy, said McCoy completely contests the allegations that he has tried to market mislabled products full of illegally concentrated amounts of Delta-9 THC.
On Monday and late last week, McCoys employees and one of his Hemp 1848 business partners actively protested along South Main Street, chanting and holding signs, including one that read Free Jerry.
One man identified himself as Marvin Artley, saying hes one of McCoys original partners at Hemp 1848.
Artley told The 69蹤獲 in an interview late last week that hes worked with McCoy since the two opened up the first Hemp 1848 shop in 2019.
Court records show Artley was previously sentenced to federal prison in the same 2004 cocaine trafficking case as McCoy.
Artley said McCoy and Hemp 1848 have not changed how Hemp 1848 sources and packages its products. He indicated the retailer uses hemp-derived THC it receives from out-of-state suppliers that he said falls within Wisconsin law for Delta-9 THC content.
Artley said Hemp 1848 has lab paperwork for each THC shipment it receives that vouches for the chemical composition and the legality of the material under Wisconsin law and the 2018 Farm Bill.
Artley said he and his coworkers suspect McCoy may be a victim of a politically motivated crackdown on Hemp-derived THC that comes as the federal government and some state laws have begun to try to limit hemp-derived THC sales.
Artley suggested the arrest might be perpetrated by authorities because McCoy has grown a business that competes against alcohol and tobacco sales, and involved a product that is unpopular with some politicians and some in law enforcement.