Securities Watchdog Alleges WeedMD Co-Founder Gave Friend Insider Information
These allegations have yet to be tested before an OSC tribunal
The co-founder of a Southwestern Ontario pot producer provided confidential information to a longtime friend who engaged in insider trading of the company’s shares, the province’s securities watchdog alleges.
Michael Kraft, who chaired WeedMD’s board of directors at the time, alerted childhood friend Michael Stein to the company’s expansion plans before the information was made public, according to a statement of allegations by the Ontario Securities Commission (OSC).
These allegations have yet to be tested before an OSC tribunal.
Kraft emailed Stein Oct. 23, 2017, with copies of draft agreements on WeedMD’s plan to buy a massive Strathroy greenhouse, a move that would significantly increase its growing capacity, the OSC alleges.
The board approved the expansion plan at a Nov. 1, 2017, meeting chaired by Kraft, who allegedly advised Stein the deal would be announced three weeks later. When the deal was finalized Nov. 21, 2017, Stein bought $68,525 worth of WeedMD shares, the OSC alleges.
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