Alaska man will serve two years in prison for failed cannabis theme park scheme

An Alaska man has been sentenced to two years in prison for his role in a scheme that defrauded investors of $722,000 with false promises of turning a lodge into a “Bud and Breakfast” cannabis resort, federal prosecutors said Friday.

The man in question, Brian Corty, was also ordered by U.S. District Judge Ralph Beistline to pay nearly $600,000 in restitution, according to a statement from the U.S. Attorney’s Office for the District of Alaska.

Prosecutors said Corty and his wife, Candy, persuaded investors to buy shares in their company, Ice Fog Holdings LLC, which claimed it would transform the Midway Lodge and a convenience store into a marijuana theme park, complete with an on-site cannabis grow operation.

To entice investors, Corty falsely claimed that Ice Fog was already generating revenue through security service agreements and stood to make millions in profits within the first few years, projecting returns of more than 30 times the initial investments, according to court documents obtained by Law360.

Corty pleaded guilty in January to a single count of conspiracy to commit wire fraud.

Prosecutors alleged that Corty, the mastermind behind the scheme, swindled investors by making “wildly optimistic” projections and lying about the venture’s progress, including falsely claiming that state marijuana regulators had already inspected the proposed site.

“In fact, the licensing and operations were never pursued in good faith, and Corty simply lived off investor funds while continuing to lie to them,” prosecutors wrote in a sentencing memorandum.

Defense counsel argued that Corty had genuinely wanted to start the business and believed in his plans, but faced numerous obstacles, including supply chain issues and the COVID-19 pandemic, that caused the venture to collapse.

At least 22 investors were misled into funding Corty’s failed business, with the couple raising $722,000 by selling shares in Ice Fog, the majority of which they misappropriated for personal expenses, prosecutors said.

U.S. Attorney S. Lane Tucker said in a statement that prosecuting white-collar criminals like Corty is a priority for her office.

“We will continue work with our law enforcement partners to pursue prosecutions against individuals who choose to exploit unknowing victims through fraudulent means,” Tucker added.