SPRINGFIELD, Ill. (WCIA) — Operating from her one-story brick storefront headquarters on Chicago’s south side that appears more like a small insurance company, Senator Patricia Van Pelt offers her ‘Wakanna’ customers a life of luxury and legacy working in the ‘cannabis space.’
The Secretary of State’s Securities Department opened an investigation in May probing Van Pelt’s side business after a WCIA report revealed she was selling tickets to seminars where she promised to reveal which cannabis stocks were “viable.” Van Pelt acknowledged on Tuesday that she has retained a lawyer during the ongoing investigation. She also volunteered that the Legislative Inspector General opened a second investigation after an apparent complaint was filed.
Van Pelt also admitted that she remains “loaded up” with investments in cannabis related stocks, despite a ban on lawmakers investing in cannabis related companies that goes into effect on January 1st, 2020.
“I don’t see a reason why any lawmakers should not be able to invest in any of it, any industry actually,” Van Pelt said.
Now, the state Senator is asking her customers to invest in their own home-based “companies” so they can sell her company’s CBD products, including oils, vapes, edibles, and sexual lubricants, to their friends and family.
Wakanna does not currently have a cannabis license in Illinois, but according to audio obtained by WCIA, Van Pelt entices her customers with the opportunity to work “in a multi-billion dollar industry,” for a “company that is bringing many minorities into the cannabis space.”
“And I mean we’re going from seed to sale,” Van Pelt elaborated in a conference call last Thursday. “We’re not trying to sell just CBD oil. That’s our entry point. We’re going down to the seed to actually get the seeds, wherever we need to get them from, to be able to grow our plants ourselves all the way to the extraction, all the way to infusing, all the way to the shelf.”
Despite her gaudy invitation for paying customers to become “marijuana millionaires,” the fine print on Van Pelt’s new multi-level marketing materials warns of high risk and low rewards.
A disclaimer on her company website lists the starting cost for new members at $500, and warns that fewer than four percent of affiliates will ever earn enough commission money to recoup that cost. A compensation chart on her company’s site says 89 percent of participants make less than $100 per month.
“We have people that range all the way from 60 cents to $13,000 in a month,” Van Pelt claimed on Tuesday when she was asked about the disparity between the compensation structure and her sales pitch.
In her weekly call with Wakanna subscribers, Van Pelt, an ordained minister, rotated between uplifting motivational speaker and demanding taskmaster, encouraging members to achieve greatness, and scolding those who complain about a “convoluted process.”
“A lot of people look at a convoluted situation and say, ‘This is just convoluted. I can’t do this, this is just too much work,'” she said, but, “We don’t care if something is convoluted. All of us are on different levels. It’s a convoluted process.”
Van Pelt encouraged new members to not only buy CBD products, but also to sign up their close friends and immediate family members to become sales representatives too. Top performers who enlist enough new recruits can achieve ‘Diamond’ status in the company. A promotional video for the company promises a trip to South Africa for high earners.
“We’ve carved out this place to allow you to claim our share of this multi-billion dollar industry,” she said. “But how can you claim your share when your mind is cluttered? You’ve got to clear out your mind.”
“All of a sudden, you’re not hungry anymore,” she continued. “Why? Because of what happened in your thoughts.”
“If you’re in Wakanna, you need to learn to use your thoughts,” Van Pelt said. “If you are in poverty, it’s because of what you’re thinking about.”
“Remember, you’re only working 40 hours a week,” she said. “You have 128 hours left. Use those 128 hours to get your fortune.”
Toward the end of the winding 18-minute call with her fellow “Wakannapreneurs,” Van Pelt made a stunning claim that has since been disputed.
“I signed up Senators, and the Secretary of State, and the Cook County Clerk of the Circuit Court,” she said.
Reached by phone on Tuesday, a spokesman for Secretary of State Jesse White, whose office is overseeing an investigation into Van Pelt, vehemently denied any business relationship with Van Pelt, and said her account was “embellished.”
“Secretary White has nothing to do with Senator Van Pelt’s business,” spokesman Dave Druker said.
Likewise, Jalyne Strong, an assistant for Cook County Clerk Dorothy Brown, told WCIA that, “Clerk Brown said she was not a part of any business deal.”
Both White and Brown had previously bought products from Van Pelt years ago during a now-defunct pyramid scheme called ‘5linx.’ The owners of that company were later imprisoned on fraud and money laundering charges.
Confronted with their denials, Van Pelt later recanted the story she initially told her conference call audience, and said she must have been referring to White and Brown’s previous involvement with her past pursuits. Van Pelt insisted she has not asked any current elected officials in Illinois to sign up or participate in Wakanna.
After news first broke of Van Pelt’s personal involvement with marijuana stocks, Illinois lawmakers scrambled to institute a two-year ban on themselves or their immediate family members from being able to invest in cannabis companies or stocks. The move was meant to allay public concern that politicians were padding their own pockets. However, the way the bill was written into law accidentally implemented a permanent, lifetime ban that would effectively prohibit any lawmaker who was in office during the passage of the marijuana law, or their immediate family members, from ever holding stake in a cannabis company.
Senator Heather Steans, a Democrat from Chicago who spearheaded the marijuana law in the state Senate, said on Tuesday that a permanent ban could be unconstitutional. Lawmakers are working now to soften the language to allow for themselves to make immediate “passive” investment through stock in publicly traded companies, and to allow for direct ownership stake in marijuana companies after a waiting period of two years.