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Two Execs Plead Guilty to Conspiring to Launder Money From Illegal Butane Business

Two former executives of a Newport Beach-based butane manufacturer tied to the marijuana industry pleaded guilty March 11 in San Diego federal court to conspiring to launder money from their business.

The business, Lahar Manufacturing Inc., but known as Puretane, was itself illegal because it specifically marketed its butane for use in making butane hash oil, a marijuana byproduct used in making edibles.

Puretane’s canisters were sold for $4 to $5 each across the country, including in at least 25 San Diego County retailers, according to prosecutors.

Former CEO Michael Tandberg and CFO Adam Hopkins are due back in court on May 27 and face up to 20 years in prison and a $500,000 fine each.

Puretane was the first and largest domestic manufacturer of butane specifically for BHO, which is called marijuana wax. It’s created by packing marijuana in a tube and spraying butane inside. The butane strips the pot of its cannabinoid oils and drips down the bottom of the tube.

Puretane marketed its product as drug paraphernalia, prosecutors said, in part by sponsoring a contest offering a case of butane to whoever could make the highest quality BHO. Its website also linked to an October 2014 “High Times” magazine article that described Puretane as “designed specifically for the needs of BHO makers.”

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