Massachusetts Sheriff Arrested, Charged with Extortion for Pressuring Cannabis Company
A Suffolk County, Massachusetts sheriff was charged last week with allegedly pressuring a Boston cannabis company to sell him company stock. Sheriff Steven Tompkins, 67, faces two counts of extortion for pressuring the unnamed company for stock as it was considering an initial public offering in 2020.
According to court documents, in 2019, the cannabis company sought to open a retail cannabis dispensary in Boston and applied to the Massachusetts Cannabis Control Commission (CCC) for a dispensary license. To satisfy the Positive Impact Plan (PIP) requirement of the CCC, the cannabis company entered into a partnership with the Suffolk County Sheriff’s Department, which would help screen and refer graduates of its re-entry program to apply for work at the cannabis company’s retail store. The partnership between the company and the department was memorialized in a September 2019 letter signed by Tompkins and submitted to the CCC in its March 2020 dispensary license application.
About a year later, the CCC approved a license for the company to operate a cannabis dispensary in Boston. The CCC later approved license renewal applications for the firm in 2021, 2022, and 2023. In each of the renewal applications, the company included its ongoing partnership with the Sheriff’s Department as part of its fulfillment of the PIP requirement, according to the indictment.
In November 2020, Tompkins allegedly wired $50,000 from his retirement account to an account controlled by the firm for the stock purchase. After the IPO, the stock value increased significantly but declined a year later, and Tompkins allegedly demanded his money back, and the company ultimately provided him a full refund.
According to court documents, the company feared Tompkins could undermine its partnership with a sheriff department program that referred released inmates to work at the company, and that Tompkins could put the company’s operating license at risk, as well as the timing of the IPO.
In a statement, U.S. Attorney Leah B. Foley called Tompkins’ alleged actions “an affront to the voters and taxpayers who elected him to his position, and the many dedicated and honest public servants at the Suffolk County Sheriff’s Department.”
“Mr. Tompkins is a sitting Sheriff, responsible for over 1,000 employees, who was elected by the good people of Suffolk County. Today, he is alleged to have extorted an executive from a cannabis company, using his official position as Sheriff to benefit himself. Elected officials, particularly those in law enforcement, are expected to be ethical, honest and law abiding – not self-serving.” — Foley in a press release
According to the indictment, Tompkins paid a pre-IPO price of approximately $1.73 per share of the company’s stock, and after a reverse stock split, Tompkins held approximately 14,417 shares at a price of approximately $3.46 per share. According to court documents, in or about mid-2021, when the company launched its IPO, the stock had a value of about $9.60 per share, so Tompkins’s $50,000 purchase of 14,417 shares the stock had appreciated to an approximate value of $138,403.
Tompkins was taken into custody in Florida and will appear in a federal court in Boston at a later date. The charges of extortion under color of official right each provide for a sentence of up to 20 years in prison, three years of supervised release, and a fine of $250,000.