This morning the SEC announced the temporary suspension of GrowLife, Inc. Per a released statement, GrowLife has announce that they were not notified in advance of these sanctions, but have contacted the SEC for a better understanding of the complaint.
“We will fully comply with the SEC’s requests for information, and continue business as normal during this temporary suspension.”
– GrowLife Response to SEC Notification
The SEC release states, “The Commission temporarily suspended trading in the securities of PHOT because of questions that have been raised about the accuracy and adequacy of information in the marketplace and potentially manipulative transactions in PHOT’s common stock.”
The suspension is to be lifted on April 24, 2014 at 11:59 p.m. EDT per the SEC release, but other reports note that it may be until April 29, 2014 until trading resumes. We are still awaiting additional information to the exact event(s) that have caused the suspension, and are unsure if the halt has anything to do with the fact that PHOT is a marijuana-based company.
Once additional information is released, we will do our best to keep you up to date and help answer any questions you may have.
What does the mean for the marijuana sector?
I normally reserve this section of the article for a particular stock(s); but with all of the buzz and concern about the entire marijuana sector generated by the suspension, I feel it is appropriate to give my take on the “pot stocks.”
Although it seems that marijuana has become almost as common in our culture as drinking is, people seem to forget that it is still illegal under federal law. Multiple states have decriminalized it, legalized for medical use, and in the cases of Colorado & Washington, recreational use. There are also many more states that have upcoming votes on the matter, with two major ones being New York and Florida. I could speak for days on the matter, as I am pro-marijuana, but the fact of the matter is that on any day of the week federal agents can shut down marijuana grow and distribution centers. This cause the sector to be extremely high-risk/high-reward. Many investors, like myself and a large amount of our followers, are willing to take this risk, but some fail to remember that these stocks are much more volatile than others in different sectors. Remember, all investments are a risk and you need to be as prepared to lose as you are to win.