The former chair of the Select Board of Grafton, Mass., was arrested June 7 on federal charges alleging he collected $432,000 from nine investors who thought they were investing in two cannabis dispensaries, but he instead spent the money on other business debts and personal expenses.
Bruce W. Spinney III, 49, served on the select board from May 2014 to August 2019. He was chair of the board from about June 2019. He resigned a day before he made a presentation before the Grafton Select Board for a host community agreement for a dispensary at 130-134 Worchester St. in Grafton, according to the grand jury indictment filed June 6 in U.S. District Court in Worcester.
Spinney sold ownership interests in his business, Noble Manna, and two dispensaries in Mendon and Grafton, Mass., falsely claiming that none of the nine investors had any ownership interests in the dispensaries, the indictment said.
Spinney touted his town leadership position to convince potential investors he had the ability to navigate licensing issues.
“Being a grafton selectman gives me a good look at the underbelly of these people as we trade financial data with other towns to help us build our host agreements,” he said in a text message to an unidentified “Person A,” who eventually bought an ownership interest in the Grafton dispensary, according to the indictment.
A ‘scheme to defraud’
The indictment said Spinney “engaged in a scheme to defraud” investors between August 2019 and February 2021 to raise money for Noble Manna, which he incorporated on Oct. 1, 2019.
In the summer of 2019, Spinney was in default on multiple business and personal loans for linen and equipment rental businesses he ran under the name Spinney Enterprises Inc. at 47 Milford St. in Mendon. The indictment said his bank accounts were “regularly overdrawn with insufficient funds.”
That’s when he started asking for money to invest in his cannabis venture. He told investors he planned on converting the Mendon property, which he owned, to a dispensary.
According to the indictment, he raised the following funds from nine investors:
- Investor 1: $75,000, October 2019, for a 10% ownership interest in both dispensaries in Grafton and Mendon. Spinney allegedly transferred $10,430 from the Noble Manna Account to the Spinney Account and then paid the Town of Grafton $10,435 for real estate taxes on his personal property and an investment property unrelated to Noble Manna.
- Investor 2: $25,000, November 2019, for interests in the Grafton and Mendon dispensaries. Spinney told Investor 2 the “seed money” would be used for permitting, licensing and other fees and expenses. But Spinney allegedly transferred approximately $49,989 of Investor 1’s and 2’s funds to the Spinney Enterprises Account and then took cash and paid for a variety of loans and personal expenses, “including for Domino’s Pizza and ‘Google Gamestur.’”
- Investor 3: $60,000, November 2019, for permitting and related construction costs at the Mendon property. Spinney then allegedly transferred $59,999 to the Spinney Enterprises Account, withdrew $5,000 cash, transferred approximately $35,817 to a debt collection firm, and transferred approximately $3,000 for personal expenses, including about $949 at BestBuy.
- Investor 4: $74,000, February 2020, for an ownership interest in both the Grafton and Mendon properties. By now, Spinney was working with Person A, who solicited the funds on Spinney’s behalf. The investor first gave Spinney $24,000 in cash, which was not deposited into the Noble Manna account. The investor also gave Spinney a $50,000 check, which Spinney allegedly transferred to the Spinney Enterprises Account to pay debt.
- Investor 5: $25,000, September 2019, for the Mendon dispensary, which Spinney allegedly deposited into the overdrawn Spinney Enterprises Account.
- Investor 6: $30,000, September 2019, for the Mendon dispensary. Spinney allegedly used the money to pay an outstanding line of credit unrelated to the cannabis business.
- Investor 7: $50,000, sometime in 2019, for the Mendon property. The amount included $5,000 converted from an unpaid loan and $45,000 cash that was never deposited into a bank account.
- Investor 8: $43,000, summer 2019, for the Mendon dispensary. The amount included $28,000 from a previous unpaid loan that was to be converted into a 2% equity interest in the Mendon property, plus $15,000 cash to pay the Mendon dispensary mortgage.
- Investor 9: $50,000, August and October 2019, for the Grafton dispensary. The investor made two check payments for an ownership interest after Spinney allegedly failed to pay the investor for tree removal work at the location and pitched this investment opportunity.
Spinney still involved with the dispensaries
Spinney still is involved with the two dispensaries, which have active licenses, according to the CRB Monitor database.
Spinney co-owns the Mendon dispensary on Milford Street with Cannapreneur Partners. It operates under the name Joint Operations. The indictment said that an unidentified “Cannabis Company” bought an equity interest in Noble Manna, as well as the property, on or about Sept. 5, 2020.
“As part of the written agreement, the Cannabis Company agreed to assume Noble Manna’s existing debts and obligations owed to Noble Manna’s investors,” the indictment said.
It said Spinney sent an email to “Person B” at the Cannabis Company on Feb. 21, 2021, “falsely claiming that there ‘was no embezzlement or misappropriation of funds.’”
Reached by phone, Cannapreneur Partners President Todd Sullivan confirmed they bought the building in 2020-2021. He said a change of control application has been pending with the Massachusetts Cannabis Control Commission since last year, and he expects approval “any day.”
Sullivan said Cannapreneur Partners would be 90% owner and Spinney would have 10%. He said the store is currently operating.
Sullivan said working with Spinney has been “fine.” He said he hasn’t read the indictment, but anything Spinney had allegedly done would have been before they met him and must have been regarding the Grafton property.
The indictment said Person A and their newly created marijuana company purchased an ownership interest in the Grafton dispensary in or about December 2020.
The property at 130 Worchester St. in North Grafton operates as Discern’d Cannabis Purveyers Inc., according to the CRB Monitor database. Spinney is listed as being on the board of directors, and Allan Villatoro is corporate officer. Villatoro did not respond to a phone call or email asking for comment.
A spokesperson for the U.S. Attorney’s office would not comment on whether Person A or the Cannabis Company named in the indictment face possible charges.
A spokesperson for the Massachusetts CCC did not respond to emails and a phone call asking for more information about licensing.
Spinney out on bond
Spinney is charged with three counts of wire fraud and one count of conducting an unlawful monetary transaction. He was arrested and taken into custody on June 7. He appeared before Magistrate Judge David H. Hennessy that same day. The judge released Spinney on a $10,000 unsecured bond and ordered he not contact the alleged victims. A status conference is set for July 19.
Spinney’s attorney, Robert M. Goldstein, declined to comment.
(This story was updated June 17 at 2:00 p.m. CDT.)
