Business
SEC Charges Eight In Cannabis Stock Promotion Scheme
Elegance Brands, Emerald Health Pharmaceutical, and High Times are the stocks included in the stock promotion scheme.
he SEC’s announcement attached the legal complaint that alleged recidivist securities law violator Jonathan William Mikula promoted the securities of four issuers Elegance Brands Inc. (now Sway Energy Corp.), Emerald Health Pharmaceuticals Inc., Hightimes Holding Corp., and Cloudastructure Inc. without disclosing that he received compensation for the promotions. Mikula is alleged to have promoted the securities through Palm Beach Venture, a newsletter for which he served as an author and chief analyst, and presented the recommendations as unbiased and not paid for, while he was secretly compensated in the form of cash and lavish expenses.
In addition to Mikula, the SEC’s complaint also charged Christian Fernandez and Amit Raj Beri, associates of Mikula’s, who allegedly acted as middlemen for the promotional scheme. The gentlemen earned millions of dollars off the promotions but hid the payments by submitting fake invoices for consulting services. Beri in particular acted as the middle man for the cannabis companies Emerald Health and HighTimes. High Times was not charged.
Elegance Brands
Beri also was listed as the CEO and CFO in various SEC filings of the company called Elegance Brands, which produced a product called Gorilla Hemp. Elegance was approved by the SEC for a Reg A offering but after nine months had raised less than a million dollars. When it was decided to promote Elegance through the Palm Beach Ventures newsletter, Beri made changes to the offering but did not prepare a new offering statement with the SEC. Thus any securities sold after that point were considered unregistered. The complaint stated, “At Mikula’s urging, and in order to “facilitate” the promotion, Elegance agreed to engage Individual 1, an associate of Mikula’s, and pay him 3% of investor funds raised through the promotion and provide him with 8.9 million shares of Elegance’s stock, which amounted to 10% of the company’s outstanding stock.”
The complaint said that the newsletter published an article stating that Gorilla Hemp was retailing for $3.95 a can; that Gorilla Hemp could yield Elegance a 2,630% price increase; that Elegance had distribution agreements in place for Gorilla Hemp with the largest adult beverage distributor in the United States; and that Elegance’s share price was projected to increase by 9,900% in five years.
The complaint stated that Elegance raised $20 million from the promotion and paid Individual 1 $350,000. The SEC statement said that Elegance has agreed to pay a penalty of $776,932; Beri has agreed to pay disgorgement of $960,314.96, prejudgment interest of $38,979.24, a penalty of $207,183, has consented to the entry of a 10-year bar and a conduct-based injunction prohibiting him from engaging in certain promotional activities.
In January 2022, Elegance renamed itself Sway Energy Corp. and earlier this year signed a distribution agreement with Halo Collective (OTC: HCANF) as part of its acquisition of H2C Beverages.
Emerald Health
Emerald Health allegedly made $30 million in the stock promotion campaign that consisted of promotional articles in the newsletter. Emerald Health’s CEO James DeMesa is accused of participating in the scheme and allegedly made material misrepresentations and omissions in the filings with the SEC and other investor materials concerning the promotion and related payments. According to the complaint, Emerald Health’s co-founder, Avtar Dhillon, played a key role in the scheme to promote Emerald Health. A separate administrative proceeding against Emerald Health’s CFO, Lisa Sanford, finds that she negligently participated in the scheme.
In 2019, Emerald Health reached out to Mikula for a story in the newsletter. The complaint wrote that Emerald Health would covertly transfer funds to Mikula by engaging Beri’s brother to ostensibly provide consulting services for the company. In turn, Beri’s brother would funnel a portion of his consulting fees to Mikula, and keep a portion for brokering the fraudulent deal. The complaint noted that DeMesa had reservations about the scheme but ultimately wanted the funds to aid in running the company.

In February and March 2020, Mikula authored a Palm Beach Venture article titled “Curing Incurable Diseases and Giving Us Over 4,900% Potential Gains,” which touted Emerald Health and was distributed to the newsletter’s subscribers. In a quarterly update to its investors, Emerald Health highlighted that Palm Beach Venture recommended the company “as an attractive investment opportunity” without disclosing that this was a paid-for recommendation. In late summer 2020, Mikula authored another Palm Beach Venture article touting Emerald Health entitled “The Next Aspirin.”
The SEC statement said that Emerald Health has agreed to pay a penalty of $517,955; DeMesa has agreed to pay a penalty of $103,591 and agreed to a five-year bar from serving as an officer and director, and Dhillon has agreed to a permanent bar from acting as an officer and director.
High Times
High Times was promoted by Palm Beach Venture between April 2020 and March 2021. The complaint stated, “Hightimes ultimately entered into an agreement to pay Entity 1, a Canadian entity controlled by Individual 2, 5% of the funds raised through the Palm Beach promotion. Beri, Individual 2, Fernandez, and Mikula agreed that they would all receive a share of monies that Entity 1 received from Hightimes. The purpose of using a Canadian entity and offshore account was to conceal that payments from Hightimes would go to Mikula.” (Hightimes — using the combined words — is the legal name for the company. However, most refer to the company as High Times).
High Times paid $150,000 for the promotion, but the complaint did not state the number of securities sold through the promotion. However, if High Times agreed to pay 5% of the securities sold and then paid the individual $150,000 it could be deduced that at least $3 million was raised through this promotion. High Times did not respond to a request for comment.

On Friday, High Times filed a report with the SEC stating that its independent auditor, RBMS LLP on July 18, 2022, declined to stand for re-appointment other than to complete the audit of the 2019 financial statements and the filing of the company’s Annual Report on Form 1-K for the year ended December 31, 2019. High Times did say that RBMS classified the company as a going concern for the years 2015-2019. High Times also stated that it has hired GreenGrowth to audit its statements from 2020 to 2021. It made no mention of the stock promotion scheme that had been announced on the same day.
The company has also extended its Reg A offering to January 2023. The offering however is paused until the company can file audited and updated financials.
The offering was stopped in June 2020, but it was July 2020 when the Cannabis Law report confirmed from HighTimes Holding Corp. lawyer Stephen Weiss and Megan Penick of L.A. based Michelman Robinson LLP that the Securities & Exchange Commission (SEC) has halted sales of shares in the company. Lawyer Megan Penick told Cannabis Law Report she wasn’t aware the company was continuing to solicit for investments even though the website to do so remained live.
In addition to that, press releases for the company continually remind readers that the offering deadline was extended and email inboxes for subscribers were flooded with almost daily offers to buy stock. The main issue according to Buhl wasn’t the company’s promotional activity, but whether the company’s escrow agent Prime Trust processed any sales after the June 12 cutoff. If no sales were processed after June 12, then there was no securities violation. Yet, the SEC says in its complaint that the Palm Beach Ventures promotion went as late as March 2021.
Source: https://thefreshtoast.com/news/sec-charges-eight-in-cannabis-stock-promotion-scheme/
Business
EU Pressure Builds on Google as Regulators Face Calls for Massive Fine Over Search Practices
A growing coalition of European industry groups is intensifying pressure on regulators to take decisive action against Google over allegations of unfair search practices that could reshape competition rules across the region’s digital economy.
Investigation Under Digital Markets Act Gains Momentum
The case is being examined by the European Commission under the European Union’s landmark Digital Markets Act (DMA), introduced to curb the dominance of major technology platforms and ensure fair competition.
Launched in March 2024, the investigation focuses on whether Google has been prioritising its own services in search results, potentially disadvantaging rival businesses that rely on online visibility to reach customers.
Industry Groups Demand Swift Action
Several prominent European organizations have jointly urged regulators to conclude the probe without further delay. They argue that prolonged investigations allow alleged anti-competitive practices to continue, putting European companies—especially startups—at a disadvantage.
Signatories include the European Publishers Council, the European Magazine Media Association, the European Tech Alliance, and EU Travel Tech.
In a joint statement, these groups warned that delays in enforcement are affecting innovation, profitability, and growth prospects for regional businesses competing in digital markets.
Google Denies Allegations
Google has rejected claims of bias, stating that its search algorithms are designed to deliver the most relevant and useful results to users. The company has also proposed adjustments to address regulatory concerns.
However, critics argue that these changes are insufficient and fail to address the core issue of market dominance.
Potential Billion-Euro Penalties
If found in violation of the DMA, Google could face significant financial penalties. Under EU rules, fines can reach a substantial percentage of a company’s global turnover, potentially amounting to billions of euros.
Regulators may also impose corrective measures requiring changes to business practices, which could have long-term implications for how digital platforms operate in Europe.
Wider Implications for Big Tech
The case highlights ongoing tensions between European regulators and major U.S. technology firms. In recent years, the EU has taken a more aggressive stance in enforcing competition laws, aiming to create a level playing field for local businesses.
A final ruling against Google could set a major precedent, influencing future enforcement actions and shaping the regulatory landscape for global tech companies operating within Europe.
As scrutiny intensifies, the outcome of the investigation is expected to play a critical role in defining the future of digital competition across the European Union.
AI & Technology
Amazon Faces Potential Criminal Trial in Italy Over €1.2 Billion Tax Evasion Allegations
Milan: U.S. tech giant Amazon is facing the prospect of a major legal showdown in Italy, after prosecutors in Milan formally requested a court to move forward with criminal proceedings over alleged tax evasion totaling approximately ₹12,500 crore (€1.2 billion).
The case targets Amazon’s European division along with four senior executives, marking one of the most significant tax-related investigations involving a global e-commerce platform in Europe.
Trial Push Despite Multi-Million Euro Settlement
The move comes even after Amazon reached a financial settlement with Italian tax authorities in December, agreeing to pay around ₹5,500 crore (€527 million), including interest, to resolve part of the dispute.
Typically, such settlements lead to the closure of criminal investigations. However, Milan prosecutors have opted to proceed, signaling a tougher stance on alleged corporate tax violations.
A preliminary hearing is expected in the coming months, where a judge will decide whether to formally indict the company and its executives or dismiss the case.
Allegations of VAT Evasion Through Marketplace Sellers
At the center of the investigation are claims that Amazon’s platform enabled non-European Union sellers to avoid paying value-added tax (VAT) on goods sold to Italian consumers between 2019 and 2021.
Prosecutors allege that the company’s marketplace structure allowed thousands of foreign vendors—many reportedly based in China—to operate without fully disclosing their identities or tax obligations. This, authorities argue, led to substantial VAT losses for the Italian government.
Under Italian law, online platforms facilitating sales can be held partially liable if third-party sellers fail to comply with tax requirements, a key point in the prosecution’s case.
Italian Government Named as Affected Party
In their filing, prosecutors identified Italy’s Economy Ministry as the injured party, citing significant financial damage resulting from the alleged tax evasion.
Legal experts say the outcome of the case could have wide-ranging implications across the European Union, where VAT systems are harmonized and similar compliance rules apply to digital marketplaces.
Multiple Investigations Add to Pressure
The VAT probe is just one of several legal challenges facing Amazon in Italy. The European Public Prosecutor’s Office is reportedly examining additional tax-related issues covering more recent years.
Meanwhile, Milan authorities are pursuing separate investigations into alleged customs fraud linked to imports from China and whether Amazon maintained an undeclared “permanent establishment” in Italy—potentially exposing it to higher tax liabilities.
In a separate regulatory action, Italy’s data protection authority recently ordered an Amazon unit to stop using personal data from over 1,800 employees at a warehouse near Rome.
Amazon Denies Allegations
Amazon has consistently denied wrongdoing and indicated it will strongly contest the allegations in court if the case proceeds. The company has also warned that prolonged legal uncertainty could impact investor confidence and Italy’s appeal as a destination for international business.
Broader Impact on Europe’s Digital Economy
If the case moves to trial, it could become a landmark moment for the regulation of global e-commerce platforms in Europe. Governments across the region are increasingly scrutinizing how digital marketplaces handle tax compliance, especially in cross-border transactions.
With online retail continuing to expand, regulators are under mounting pressure to ensure that multinational platforms and third-party sellers adhere to the same tax rules as traditional businesses.
Aviation
IndiGo Crisis Exposes Risks of Monopoly: What If Telecom or E-commerce Collapses Next?
Airports across India witnessed scenes of distress and confusion as thousands of passengers were stranded due to IndiGo’s massive flight disruptions. Families with medical emergencies, funerals, and personal crises were left helpless as the airline cancelled hundreds of flights without adequate communication or support.
Passengers described desperate situations — a mother pleading for sanitary pads for her daughter, a woman unable to transport her husband’s coffin, and others stranded while trying to reach family funerals or hospitals. “It was like a lockdown at the airport,” one passenger said, describing the panic that unfolded as IndiGo’s mismanagement crippled operations nationwide.
Root Cause: IndiGo’s Market Monopoly
The turmoil, industry experts argue, stems from IndiGo’s monopolistic control over India’s domestic aviation market. The airline operates nearly 2,100 flights daily and holds around 60% market share — meaning every second plane flying within India belongs to IndiGo.
This dominance has given the company unparalleled influence. When IndiGo falters, the entire aviation system suffers. Passengers are left with few alternatives, as other airlines lack capacity to absorb stranded travellers. The result: skyrocketing ticket prices, chaos at terminals, and total dependence on a single private operator.
Aviation pioneer Captain G.R. Gopinath, founder of Air Deccan, criticised the government’s inaction, noting that on some routes, IndiGo’s economy fares surged to ₹1 lakh. He compared the situation to a hostage crisis, writing that the airline “held the system ransom” and forced regulators to defer new safety rules meant to protect pilots and passengers.
Government Intervention and Regulatory Weakness
The crisis erupted after IndiGo failed to comply with the Flight Duty Time Limitations (FDTL) — rules introduced by the DGCA in January 2024 requiring adequate rest for pilots. Despite having nearly two years to adapt, IndiGo blamed the rule for operational disruptions, citing a shortage of pilots.
Under mounting public pressure, the government stepped in, temporarily relaxing FDTL norms and capping airfare hikes. Officials claimed the move was to protect passengers, but analysts say it exposed the state’s vulnerability to corporate monopolies. “The government had no option but to yield,” said one aviation policy expert, pointing out that ignoring safety regulations for short-term relief could have long-term consequences.
The crisis also rekindled memories of the June 2025 Air India crash near London, which claimed over 240 lives. Experts warn that compromising pilot rest and safety standards to maintain flight schedules could risk another tragedy.
If Telecom Giants Fail: A National Paralysis
The article raises a troubling question — what if a similar crisis struck the telecom sector, where Jio and Airtel together control nearly 80% of subscribers and serve over 780 million users?
If both networks failed simultaneously, the repercussions would be catastrophic. Internet shutdowns would halt UPI transactions, online banking, OTP verifications, video calls, OTT streaming, and emergency communications. Critical services such as airports, hospitals, stock exchanges, and small businesses — many of which rely on WhatsApp and digital payments — would come to a standstill.
In essence, a telecom breakdown could paralyse India’s digital economy, exposing the nation’s dependence on a duopoly.
E-commerce Monopoly: Another Fragile Ecosystem
The same risk looms over the e-commerce sector, where Amazon and Flipkart dominate nearly 80% of the market. A disruption similar to IndiGo’s could cripple daily life — halting delivery of groceries, medicines, and essential goods, freezing refunds and customer support, and leaving small sellers without platforms to trade.
Local retailers, freed from competition, might exploit shortages by inflating prices. Such a scenario underscores the perils of market centralisation in sectors critical to everyday living.
A Wake-Up Call for Regulators
The IndiGo crisis, analysts say, is a warning shot for policymakers and regulators. A single company’s operational failure exposed systemic weaknesses in India’s infrastructure and consumer protection mechanisms.
As the aviation regulator DGCA investigates and IndiGo works to restore normalcy, the broader lesson remains clear: unchecked monopoly power in any essential service — whether air travel, telecom, or e-commerce — poses a direct threat to economic stability and citizen welfare.
Without stronger competition laws, redundancy frameworks, and regulatory oversight, India risks repeating this crisis across multiple sectors — each time with millions of citizens paying the price.
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