--- title: SEC Fines Colorado Cannabis Stock Promoter $4.1 Million description: The SEC fined a cannabis stock promoter, Jeffrey O. Friedland, over $4.1 million for failing to disclose that his ownership interests in OWC Pharmaceutical Research Corp., an Israeli medical marijuana company, to investors. The SEC also banned Friedland from participating in any future penny stock offerings. The SEC’s complaint alleged that Friedland failed to disclose […] image: https://cdn.prod.website-files.com/66525ec138843cc1ccb1c325/68c301ebaa36be33aa2af8f7_1a3f16114a452999cc4d7d6b36ae1602_Obedio%20march%20of%20progress.png --- [Skip to content](https://hs.getobedio.com/blog/2019/12/12/2019-12-12-sec-takes-41-million-from-colorado-cannabis-stock-promoter#main-content) [![Obedio logo with black text and an orange graphic composed of four circles and a diagonal arrow pointing up and right.](https://cdn.prod.website-files.com/66525ec138843cc1ccb1c325/66529844eddaa630d6da1b42_obedio%20gold%20for%20white%20background.png)](https://getobedio.com) [Team](https://www.getobedio.com/team) [Pricing](https://www.getobedio.com/pricing) [Contact](https://www.getobedio.com/demo) [Blog](https://www.getobedio.com/blog) [Login](https://obed.io/v4/login) Colorado # SEC Fines Colorado Cannabis Stock Promoter $4.1 Million ![Susan Ameel](https://7528315.fs1.hubspotusercontent-na1.net/hub/7528315/hubfs/raw_assets/public/mV0_d-cms-elevate-theme_hubspot/elevate/images/avatar-placeholder.jpg?width=48&height=48&name=avatar-placeholder.jpg) Susan Ameel December 12, 2019 The SEC fined a cannabis stock promoter, Jeffrey O. Friedland, over $4.1 million for failing to disclose that his ownership interests in OWC Pharmaceutical Research Corp., an Israeli medical marijuana company, to investors. The SEC also banned Friedland from participating in any future penny stock offerings. The SEC’s complaint alleged that Friedland failed to disclose the fact that OWC paid him millions of dollars in shares to promote the company. The SEC believed that Friedland represented himself in interviews and other public events targeting investors as an active investor rather than a paid promoter. Friedland made an initial investment of $119,000 in OWC in 2014. In 2016, OWC gave Friedland another 5.1 million shares in restricted stock to promote the company and to specifically target investors. Between 2016 and 2017, Friedland promoted the company to investors through email, interviews, and presentations. He failed to disclose to these investors that OWC paid him with stock. The stock price during 2016 and 2017 rose from $0.40 to a high of $2.19. The stock is now trading at $0.0066 per share. The SEC stated that Friedland misrepresented the facts to a transfer agent in order to remove the restriction from selling the shares into the market. The transfer agent removed the restricted legend on February 3, 2017 when the stock was trading at $0.70. He transferred the shares to an account held by his wife. The broker-dealer refused to sell the securities because it believed that Friedlander caused a spike in the stock price by sending a letter to the shareholders. Friedlander transferred the shares after he failed to convince the broker that he was no longer a promoter for OWS. At the time of the transfer, OC was trading around $0.90. Friedland began selling the 5.1 million shares at the beginning of March when the stock was trading around $1.36. Friedland continued to promote the stock on twitter and Pot Stock Radio during the time he was selling OWC. The position was sold by mid-march when the stock was trading around $1.25 for a profit of $6.5 million. The stock fell to $0.22 by September 22, 2017, and never recovered. Friedland and his wife used the money to buy homes, cars and to fund their children’s trust. Investors interviewed by the SEC said that it was important to know that Friedland was being paid millions by OWC to promote the stock. The SEC’s action highlights the importance of disclosing conflicts with investors. Issuers and companies should also set the guardrails for folks promoting securities. A stock promoter that is not following the SEC’s rules and regulations can risk the company’s market valuation and ultimate survival. Emerging firms may see stock promotion as a way to accelerate growth but it may come with a high cost. ## Share this post [mailto:https%3A%2F%2Fhs.getobedio.com%2Fblog%2F2019%2F12%2F12%2F2019-12-12-sec-takes-41-million-from-colorado-cannabis-stock-promoter](mailto:https%3A%2F%2Fhs.getobedio.com%2Fblog%2F2019%2F12%2F12%2F2019-12-12-sec-takes-41-million-from-colorado-cannabis-stock-promoter) ## Keep reading ### [Data Center Local Municipalities Economic Development Microsoft's Seven Buildings in Wisconsin, a 551-Acre Fight in Virginia, and a Proposed Ban in Florida: What Changed for Data Centers This Week](https://hs.getobedio.com/blog/seven-buildings-in-wisconsin-a-551-acre-fight-in-virginia-and-a-ban-in-florida-what-changed-for-data-centers-this-week) ### [Local Municipalities Home Rule Flock Arlington County, VA, Dayton and Mountain View Are Among 14 Large Local Governments Ending or Pausing Flock Cameras](https://hs.getobedio.com/blog/arlington-county-dayton-and-mountain-view-are-among-14-large-local-governments-ending-or-pausing-flock-cameras) [![Obedio your municipal data source](https://hs.getobedio.com/hs-fs/hubfs/google%20workspace-1.png?width=100&height=41&name=google%20workspace-1.png "Obedio your municipal data source")](https://getobedio.com) Obedio's business intelligence platform provides data and insights from over 25,000 municipalities, enabling retail, manufacturing, finance, real estate, and government clients to make informed decisions, assess risk, and identify opportunities. **Data Source & Liability Disclaimer:** The data presented on this website is aggregated from various official government and public entities ("The Original Government Sources"). 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