: Former CEO of NewAge, a drink company that shot to pot-stock fame, accused by SEC of ‘multi-year fraud’

by | Oct 18, 2022 | Stock Market

The Securities and Exchange Commission has filed charges against former NewAge Inc. Chief Executive Brent David Willis, accusing him of a “multi-year fraud” that included misleading public statements meant to promote the wellness-focused beverage maker that once hoped to take advantage of the nation’s CBD craze. The SEC alleged that Willis’ statements created the “illusion” that NewAge
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was a pioneer in beverages containing CBD — a cannabis compound that is viewed as non-intoxicating — and that its beverage products overall were taking off with big retailers and distributors worldwide, in an effort to boost the company’s financials and stock price.

NewAge was called New Age Beverages Corp. when it briefly enjoyed attention from investors as a CBD-drink company amid widespread interest in “pot stocks” after the legalization of recreational cannabis in Canada. The company’s market capitalization shot as high as $500 million in early 2019. But in recent weeks , NewAge had its stock delisted from the Nasdaq and filed for bankruptcy protection. The stock, which still trades over the counter, ended Tuesday’s trading session with a market cap of less than $3 million. In a complaint filed Tuesday, the SEC characterized NewAge as a company that was in “dire financial straits” through 2017 and 2018, and said Willis was “well-informed and knowledgeable about NewAge’s business operations and activities.” Fr …

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