ABSTRACT
This chapter addresses the risks of making an investment in a cannabis company. Due to the expansive nature of U.S. drug laws, which were explored in Chapter 1, investors in cannabis companies are exposed to potential criminal and civil actions. These risks, however, can be seen as largely theoretical, as there have been almost no publicly known cases of investors in state-legal businesses being charged. The real challenges and risks of cannabis investments are more prosaic – banking, reputation risks, insurance, and background checks by regulators.
