Four stock traders have been charged by the U.S. Securities and Exchange Commission with manipulating shares of cannabis companies in a pump-and-dump scheme.
The stocks affected include GrowLife and Hemp Inc., as well as some non-cannabis securities.
The defendants allegedly used manipulative tactics to create the appearance of heavy trade volume, which in turn caused demand for the stocks – and concurrently, their prices – to rise.
According to the SEC, the defendants netted $2.5 million from the schemes.
GrowLife had its shares temporarily halted by the SEC earlier this year amid allegations of trading irregularities. The news was soon followed by a change in leadership at the company,