Alaska Couple Charged in $700,000 Investment Fraud Scheme Based on Fictitious Alaska Marijuana “Bud and Breakfast”
For Immediate Release
U.S. Attorney's Office, District of Alaska
FAIRBANKS – A federal grand jury in Alaska returned an indictment charging a husband and wife from Delta Junction, Alaska, with conspiracy and wire fraud for perpetrating a years’ long scheme that defrauded nearly two-dozen investors out of over $700,000 dollars.
According to court documents, from 2017 until 2020, Brian Keith Corty, 52, and his wife Candy Corty, 47, used false and fraudulent claims to solicit investors to buy shares of stock in Ice Fog Holdings, LLC, a company purportedly established to grow, extract, develop, manufacture, and sell products in the medical and recreational marijuana markets in Alaska and other future markets. The defendants purchased the Midway Lodge along the Richardson Highway near Delta Junction, Alaska, and represented to investors that their money would be used to turn it into a “Bud and Breakfast” that would be a “marijuana theme park” and include glass ceilings so Ice Fog’s customers could lie in bed and watch the northern lights. Defendants also represented that they would grow, cultivate, and sell marijuana from the location.
The defendants and their co-conspirators made numerous material misrepresentations to Ice Fog investors, including that Ice Fog was already generating income via contracts for security services, that Ice Fog would make over $3.85 million in annual sales by year one; over $13.05 million in annual sales by year two; and over $23.24 million by year three with an expected return to investors of 30 times their initial investment. The defendants also represented that inspectors from the Alaska Marijuana Control Office had performed inspections on the Midway Lodge to create the impression that their application to become a licensed marijuana grow and dispensary was in the final stages of approval. Defendants made these representations while knowing that Ice Fog had no meaningful current or prospective revenue stream and little to no prospect to obtain a license from the Alaska Marijuana Control Office.
Over the course of the scheme, the defendants caused at least 22 individuals to invest in Ice Fog, and raised approximately $722,000 dollars through the sale of “shares” in Ice Fog Holdings, the majority of which the defendants misappropriated for their own personal use.
U.S. Attorney S. Lane Tucker of the District of Alaska made the announcement.
The Federal Bureau of Investigation is investigating this case with assistance from investigators at the Alaska Department of Law. Assistant U.S. Attorneys Ryan Tansey and Tom Bradley for the District of Alaska are prosecuting the case.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Updated May 3, 2023