The North American Securities Administrators Association ("NASAA") warned investors of scams and risks concerning marijuana-related investments. The NASAA alert follows a previous Investor Alert, issued by the SEC Office of Investor Education and Advocacy and the Retail Strategy Task Force, on marijuana-related investments.

According to NASAA, investors should be aware of common scams and schemes, including (i) reverse merger scams, (ii) pump and dump schemes, (iii) crowdfunding schemes and (iv) jurisdiction-specific illegal marijuana schemes, in which investors are encouraged to invest on the basis of false claims of a new law or pending regulation. NASAA also outlined several unique risks related to the fact that marijuana is not legal in all states, including that the U.S. government still does not allow its use, and that most investment opportunities are "high-risk start-up ventures with a significant chance of failure."

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