SEC suing Denver businessman for alleged fraud

DENVER — The U.S. Securities and Exchange Commission is suing a Denver businessman in the marijuana space for allegedly promoting penny stock while offloading 6.4 million shares for $7 million.

Jeffrey O. Friedland is being sued for fraud, reports BusinessDen. The SEC claims he violated SEC rules by not disclosing he was being paid to promote Israeli cannabis company OWC Pharmaceutical Research Corp. and publicly proclaiming the stock was a buy, all while selling millions of shares.

The lawsuit says that Friedland paid $120,000 in 2014 for 1.3 million shares and received 5.1 million shares in 2016 for handling media and investor relations for the company. When he unloaded his shares in 2017, he had about 6 percent of the company stock. The lawsuit also says that Friedland did not disclose he was a paid OWC consultant in media appearances.

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The SEC also claims Friedland violated trade laws when he publicly promoted stock he was offloading.

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