Irth Communications and Andrew Haag may not ring a bell for many cannabis stock shareholders, but the group was hired to promote stocks and did not disclose that information. The two received a cease and desist order from the Securities Exchange Commission on Wednesday.
No cannabis companies were named in the order. The order states that the company, “Tweeted or retweeted twenty-three times positive news articles describing the business, products, and securities of nine clients. Irth received approximately $35,000 in compensation from these nine clients attributable to these twenty-three tweets and re-tweets.” this compensation was not disclosed.
The order also stated that “Irth shall, within 10 days of the entry of this Order, pay disgorgement of
$35,000, prejudgment interest of $4,233.71, and a civil money penalty of $35,000 (for a total of $74,233.71) to the Securities and Exchange Commission.” Haag, who is the majority owner Haag was told that within 10 days of the entry of this Order, he was to pay a civil money penalty of $7,500 to the Securities and Exchange Commission.
MassRoots (MSRT) was one of the companies that had hired Irth Communications, but insisted it did not know about stock promotions. Other cannabis companies said to have hired Irth Communications include 22nd Century (XXII), Lexaria Bioscience Corp. (LXX) and CV Sciences (CVSI). Having hired Irth Communications doesn’t necessarily mean that the companies violated regualtions as it was up to Irth Communications to disclose it had been hired and paid by these companies.
Irth Communications was also a sponsor of Benzinga’s February 2020 conference in Miami and the ROTH Conference in March 2019.
Sharesleuth chronicled in a lengthy investigative piece how Irth Communications was planting stories in various financial news websites. (None of these appeared in Green Market Report nor has GMR ever worked with Irth Communications writers.) The company appeared to have created ficticious authors to write stories touting certain stocks.