Dhar Mann, a controversial young businessman who sought fame and fortune as an entrepreneur in the medical marijuana industry, was charged Thursday with 13 felonies for allegedly defrauding an Oakland, California grant program that helps property owners pay for renovations.
Alameda County prosecutors charged Mann, 27, with stealing thousands of dollars from Oakland in 2008 and 2009, report Demian Bulwa and Matthai Kuruvila at SFGate
. Mann was not arrested; his arraignment is scheduled for Wednesday.
Mann’s attorney, John Runfola, admitted that his client “took shortcuts” in the grant program, but claimed the charges were trumped up.
Mann — who launched “weGrow,” the United States’ first chain of hydroponic superstores catering to marijuana growers — also owns a property management firm, rents out limousines and exotic cars, and is involved with one of Oakland’s biggest taxi companies, Friendly Cab.
|Dhar Mann shows off his conical haircut and new Beamer
Oakland city leaders, including several mayoral candidates and city councilwoman Jean Quan, had attended the October 2010 reopening
of Mann’s first weGrow superstore (initially called iGrow).
While operating MannEdge Properties of Oakland, prosecutors said he defrauded city redevelopment programs that paid as much as half of the renovation costs for commercial buildings.
According to prosecutors, Mann submitted copies of cashier’s checks which he had made payable to contractors as “proof” he had made the required renovations. But he actually paid the contractors much less, and redeposited the cashier’s checks in his own bank account, according to a court filing written by Frank Moschetti of the district attorney’s office.
The City of Oakland paid Mann more than $44,000 based on his fraudulent paperwork, Moschetti said.
Mann had gotten grants for 12 projects, according to his attorney, Runfola, who said Mann’s own spending exceeded the $44,000 in “matching grants” from the city.
“Discouraged by … the complex bureaucratic process and the struggling economy, my client admittedly took shortcuts to complete reimbursement for the development process,” Runfola conceded. “It is unfortunate that the district attorney’s office is prosecuting this young businessman instead of continuing the dialogue.”
Prosecutors allege at least four of his projects were fraudulent.
In one case, from October 2009, Mann told the city he was going to pay $48,500 to Berumen Construction of Dublin for work on a warehouse where Mann later opened one of his hydroponics stores, according to Moschetti. Company owner Javier Berumen told city investigators that Mann had later “renegotiated” the deal for only $22,000.
But in November 2009, Mann sent documents to the city purporting to show he had paid Berumen the full $48,500. Less than a month later, the investigator said, Mann claimed he had paid Berumen $14,700 more.
“In truth, Berumen never received those checks, nor did he do all the work indicated,” Moschetti said.
Mann, who rose to near-fame when his chain of hydroponics stores got national publicity, was featured on the cover of Mother Jones
magazine and in documentaries
, and even got a reality show on TV.
Within a year of weGrow’s launch, multiple lawsuits erupted between Mann and his estranged business partner, Derek Peterson, with a variety of increasingly hostile claims and counterclaims being filed both parties against each other. But the suits and countersuits reportedly ended in March as the two entrepreneurs agreed on an undisclosed settlement
He helped host a fall 2010 fundraiser at his parents’ Dublin home (Mann comes from an influential family) for now-Governor Jerry Brown. The photo of Mann and Brown drinking champagne was posted on Mann’s Facebook page.