Can B Corp (CANB)

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Ok, so let's put things into perspective.

Over and over and over again, the CEO is labeled as a scam artist, thief and criminal who has been busted multiple times. Unless I am missing something, this has been purposely exaggerated by others.

The CEO of Canbiola has formally held positions heading security brokerage companies. Between 2005 and 2006, there were three FINRA violations. FINRA monitors brokers, and is not the SEC. The Financial Industry Regulatory Authority (FINRA) is a regulator, though it is itself regulated by the SEC. It is not a government agency, but a private not-for-profit organization whose membership is comprised of broker-dealers.

Also, all disciplinary action by FINRA or the SEC is civil and not criminal.

First violation was in 2005:

§240.15g-2 Penny stock disclosure document relating to the penny stock market.
(a) It shall be unlawful for a broker or dealer to effect a transaction in any penny stock for or with the account of a customer unless, prior to effecting such transaction, the broker or dealer has furnished to the customer a document containing the information set forth in Schedule 15G, §240.15g-100, and has obtained from the customer a signed and dated acknowledgment of receipt of the document.

So, this violation is a lack of providing required disclosures for Penny Stock purchases and failure to review financial disclosures prior to making stock recommendations. Nowhere within the violation were any actions that constitute lying or scamming.

Second was filed in 2005:

By: GEORGIA COMMISSIONER OF SECURITIES, SECURITIES DIVISION

SUBJECT FAILED TO DISCLOSE THAT HE WAS THE SUBJECT OF A NASD INVESTIGATION AT THE TIME HE FILED AN APPLICATION TO REGISTER IN GEORGIA WITH BASIC INVESTORS.

HIS EVENT WAS A FAILURE TO DISCLOSE AN INVESTIGATION, NOT A VIOLATION OF ANY INVESTMENT-RELATED REGULATIONS AND/OR STATUTES.

Third was in 2005 for Failure to Supervise NASD Conduct rules 3010a and 3010b.

"RESPONDENT FAILED TO ESTABLISH AND MAINTAIN A SUPERVISORY SYSTEM AND WRITTEN SUPERVISORY PROCEDURES FOR HIS MEMBER FIRM THAT WERE REASONABLY DESIGNED TO SUPERVISE THE ACTIVITIES OF EACH REGISTERED REPRESENTATIVE ASSOCIATED WITH HIS MEMBER FIRM TO ACHIEVE COMPLIANCE WITH THE APPLICABLE SECURITIES LAWS AND REGULATIONS AND THE RULES OF NASD."


The description is lengthy and goes on, however it was not an actual act that created the violation, but rather a lack of having sufficient controls in place.

Merril Lynch, in 2010 was also fined for the same violation. Merril Lynch is a multi billion dollar subsidiary of Bank of America

https://www.investmentnews.com/article/20181214/FREE/181219955/finra-fines-merrill-300000-for-failing-to-supervise-rogue-broker

So, according to some of the accusations, this would also make Merril Lynch a bunch of scammers.

FINRA fined JP Morgan for the same violation. However, most won't consider JP Morgan a bunch of con artists for that same violation.

https://www.investmentnews.com/article/20190916/FREE/190919943/finra-fines-j-p-morgan-1-1-million-for-failing-to-disclose-broker

"The Financial Industry Regulatory Authority Inc. has fined J.P. Morgan Securities $1.1 million for not reporting internal reviews or allegations of broker misconduct in a timely manner. From January 2012 to April 2018, Finra found 89 instances where J.P. Morgan Securities either failed to meet Finra's deadline to disclose when a registered representative did things like misappropriate funds, borrow from customers, forge or falsify documents, make unauthorized trades or recommendations, or engage in other suspicious activity. Sometimes J.P. Morgan didn't file a disclosure at all, Finra alleges."

Interesting – here is another:
https://www.shreveporttimes.com/story/news/local/2019/10/29/panel-rules-raymond-james-must-pay-29-ex-clients-eddie-lyons-more-than-3-m/2500740001/

Raymond James is also a busted scam company for failing to supervise.

In regards to the failure to disclose violation, it was nowhere near what Oppenheimer was charged with in 2015.

https://www.sec.gov/news/pressrelease/2015-14.html

"Oppenheimer’s first violation involved aiding and abetting illegal activity by a customer and ignoring red flags that business was being conducted without an applicable exemption from the broker-dealer registration requirements of the federal securities laws.

According to the SEC’s order, the second course of misconduct involved Oppenheimer again engaging on behalf of another customer in unregistered sales of billions of shares of penny stocks."

If you want to see real cases of scamming activity, look no further than the CEO and insiders with CVSI in 2017:

SEC filed fraud charges against cannabis company CannaVest (CVSI) and its CEO, Michael Mona, Jr., after the company allegedly inflated its share price to reach a market capitalization of $26 million. Mona's business partners at CannaVest had been lauded before the federal crackdown as the first "pot stock billionaires."

The Securities and Exchange Commission filed fraud charges against a Las Vegas-based hemp oil company and its CEO for inflating the company's assets on its balance sheet.

https://www.sec.gov/litigation/litreleases/2017/lr23861.htm

Overall, FINRA had overall 6,600 actions filed for violations in the past five years with 3,300 brokers receiving some type of suspension. FINRA violations are not a rare occurance. Not saying any of this is great news, but something that occured over 13 years ago, and constituted wrongdoing and mismanagement versus "scamming" or trying to rip people off.

I know the point was about Dilley, but that is too much for one post so I will follow this up in a little bit with my thoughts about that.