Shocking Betrayal: Ex-Minnesota House Leader's $2M THC Startup Crumbles Amid Partner's Alleged $500K Heist!

MINNEAPOLIS (FOX 9) - A troubling case of alleged embezzlement has emerged from the cannabis industry in Minnesota, targeting a startup co-founder. Richard Schenk, who co-founded the Crooked Beverage Company earlier this year, faces serious charges for reportedly misappropriating funds intended for the company to cover personal expenses.

The situation began to unravel just a few months after the company launched. Ryan Winkler, another co-founder of Crooked Beverage, expressed concerns about Schenk's behavior, stating, "We discovered within a few months that one of our partners was taking money out of the company, being very evasive, not answering questions." This evasiveness raised red flags among the partners, prompting further scrutiny.

According to court documents, Schenk was under financial pressure, allegedly owing his ex-wife more than $300,000. Payments to her were expected to come from his earnings, which compounded the suspicion when the other co-founders received a fraudulent email, purportedly from a well-known defense attorney. This email falsely indicated they had no obligation to pay the ex-wife, but it was later revealed that it was sent by Schenk himself.

Winkler elaborated on the extent of Schenk’s alleged misconduct, stating, "There were no expenditures that he was going to make that I was going to be happy with, but that in particular just shows the kind of high life he was living at other people's expense." The questionable expenditures reportedly included lavish personal expenses such as mortgage payments and luxury items, totaling approximately $28,000. When confronted about these issues, Schenk resigned, yet he allegedly withdrew an additional $48,000 before stepping down.

As a result of these allegations, Schenk now faces two felony theft charges. Despite this significant setback, Crooked Beverage Company continues to operate and has successfully distributed its products in hundreds of locations across Minnesota and in ten other states. The company's resilience in the face of adversity highlights the potential for recovery in the burgeoning cannabis beverage market, despite the legal challenges posed by Schenk's actions.

While the situation raises questions about the integrity within the cannabis industry, it also underscores the need for rigorous financial oversight, especially as the market continues to expand rapidly. Many startups in this sector may face similar pressures and temptations as they navigate a landscape marked by both opportunity and risk.

It remains uncertain how Crooked Beverage will recover from the financial losses incurred due to Schenk's alleged actions and how recent legislative changes will impact their operations moving forward. As the cannabis industry evolves, cases like this could serve as cautionary tales for other entrepreneurs entering this dynamic market.