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by Mike Caswell

A New York judge has imposed a five-year jail term on Vitaly Fargesen, a New Jersey man who pleaded guilty to charges arising from a fraud at Vancouver's Canafarma Hemp Products Corp. in 2019. Prosecutors claimed that Mr. Fargesen and others raised $14-million from investors while running Canafarma's hemp operation "just for show." (All figures are in U.S. dollars.) The operation could supposedly produce $68-million in sales, but in reality the group used the company as a vehicle to take investor money for themselves, the government said.

Mr. Fargesen received his sentence in an appearance before Judge Loretta Preska on Wednesday, July 10. In addition to the five years in jail, the judge ordered him to pay $4.7-million in restitution. Upon completion of his prison term, Mr. Fargesen must serve three years of supervised release.

The sentence is mostly a victory for prosecutors, who had requested a jail term of 6-1/2 years. They described Mr. Fargesen's actions as "serious and deliberate crimes." Among other things, he and a co-accused, Igor Palatnik, arranged for Canafarma to have a CEO who would be the public face of the company while the men misappropriated money through bogus consulting agreements, routing large sums through offshore entities, the government said. Money from one set of payments, for a supposed "road show" in Europe, was actually spent buying a Land Rover for Mr. Fargesen, according to the government.

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