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SEC Accuses High Times CEO Adam Levin of Securities Fraud

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The complain also alleges that Levin falsely represented the share price to investors.

The Securities and Exchange Commission (SEC) filed a complaint against High Times Chief Executive Officer Adam Levin alleging securities fraud. The complaint alleges that Levin engaged a stock promoter without informing investors, sold High Times stock when it was no longer eligible to be sold and falsely represented the share price to investors.

The SEC claims that Levin began working with William Mikula, who authored a newsletter called Palm Beach Ventures that doled out stock advice. Mikula has pled guilty in another case on stock promotion. The SEC alleges that Levin paid a third party in order to conceal the payments to Mikula to hide the stock promotion.

The SEC claims that two days after signing a contract with the third party, Palm Beach Ventures wrote an article touting High Times stock. The complaint says that the newsletter falsely stated there was no compensation. The SEC claims that Mikula received $150,000 for the work in addition to the expenses for entertaining him.

The SEC went on to allege that Levin was told by another middleman Raj Beri that he needed to entertain Mikula in exchange for the promotion. They allege the following entertainment expenses:

  • Hightimes and Levin expended approximately $100,000 in investor funds to entertain Mikula and his associates.

  • These lavish entertainment expenses included meals and bottle service at clubs, yacht rentals to host Mikula, the engagement of entertainers, and other such expenses.

The complaint states that between April 2020 and June 2020, Hightimes raised $6 million through the Palm Beach promotion.

High Times Offering

The SEC noted that High Times was initially permitted and qualified to sell stock in a Reg A+ offering in March 2018. The company was also permitted to offer shares at $11 each. However, the SEC stated that by June 2020 the company failed to update audited financial statements. Since the company didn’t file these statements it was no longer allowed to sell the stock. The complaint stated,

From June 2020 through December 2022, Hightimes continued to offer and sell approximately $13 million in Hightimes securities. Misrepresentations to Investors

The SEC said in its complaint that High Times was qualified to sell shares at $11 a share, but then they alleged that during the stock promotion with the Palm Beach Venture newsletter, he falsely changed the price to $1.

According to the complaint, “Levin falsely stated that Hightimes had changed its share price from $11 per share to $1 per share. Palm Beach’s promotional materials, as well as Hightimes investor website, falsely stated that investors were purchasing shares at $1.”

The SEC claims, “In fact, Hightimes investors purchased, and continue to hold, at $11 per share.” The SEC is asking the court to make Levin pay a civil penalty and bar him prohibiting him from acting as an officer or director of any issuer that has a class of securities.


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