Cannabis biz spams thousands of children’s emails seeking investors


As the cannabis movement goes more main stream, the hucksters, frauds, snake oil salesmen, and get-rich-quick types are coming out of the woodwork. Nowhere does such a low-level life form thrive better than on the world wide web.
But while information becomes more readily available online, reliable information becomes more of a rare and valued commodity – particularly when it comes to pot. The charlatans trying to profit on the cannabis boom know this, and they are quite literally in a race to cash in as large as possible before the capitalistic opportunity of a lifetime dries up.
This haste – and its consequences – has been demonstrated time and again in the grey-collar world of trading weed-related stocks. As despicable as this practice of pumping and dumping pot stocks is, at least they are targeting adults.

It seems that each week brings a new version of the MedBox scam or the KannaWay scheme to Wall Street, attempting to bilk bleary-eyed investors out of their hard-earned money by using one of the slimiest tactics in the books.
Wikipedia defines the “Pump & Dump” as “a form of microcap stock fraud that involves artificially inflating the price of an owned stock through false and misleading positive statements, in order to sell the cheaply purchased stock at a higher price. Once the operators of the scheme ‘dump’ their overvalued shares, the price falls and investors lose their money.”
Now enter Rainbow International Corp (RNBI), a publicly-traded Colorado-based company who claims to be on the cutting edge of CBD medicine technologies.
A peek behind the multitude of favorable press releases shows that RBNI has made exactly ZERO dollars since its inception. They currently show $47 in assets. That’s no typo, we didn’t forget to add 0’s to the end – forty seven bucks. So they have no cash, $82,000 in liabilities and another $342,000 in accumulated deficits.

But, all was not lost for the sputtering penny-stock. A series of self-aggrandizing press releases promising huge gains were sent out to unsuspecting investors, and before they knew it they had churned $2 million in dollar volume, leading to a 76% spike in the stock’s price.
Playing the game isn’t cheap however, especially when you are hiring liars and cheaters to build your brand. Somebody with a vested interest in RBNI reportedly paid upwards of $250,000 to run that first round of artificially inflating press releases.
So for their latest pump effort, the decision makers at RBNI blasted out tens of thousands of emails on June 24th, promising “one hell of a ride” for those who bought in. The email warns the reader not to get left behind when the $0.20/share stock balloons to over $1.00/share by mid-July.
In what should have been standard operating procedure at this point for the folks at Rainbow International Corp, somebody fucked up and sent 9,603 of these emails to subscribers of Zoobah, a service that strives to provide safe email access to children. Oops.
The flood of spam emails crashed Zoobah’s servers, which along with the content of the messages, has the underage email provider pretty upset. Zoobah, which boasts over 44,000 registered accounts in all 50 states and 27 countries worldwide, sued RBNI this past Friday in Federal Court.
In their 16-page complaint, Zoobah blasts the lazy marketing of RBNI, and claims that the overwhelming amount of web traffic caused “significant harm in the form of server spikes, server crashes, bandwidth spikes, memory exhaustion, and unrecoverable hardware failure, all of which are attributable to its receipt of spam email, including the emails in question.”
They are citing the CAN-SPAM Act (Controlling the Assault of Non-Solicited Pornography and Marketing Act), and seeking an immediate injunction, since they continued to receive the adult-themed messages well into the following day on June 25th. Additionally, Zoombah seeks $150 for each infraction of the Act, plus restitution for costs and treble damages.
It is more than a bit of sweet irony that the very tactics that have kept a scam like RBNI afloat for this long will likely prove to be its undoing. Live by the spam, die by the spam. If the toddlers don’t take them down, the SEC is likely waiting in the wings.