By Tom Winnifrith | Thursday 11 February 2021
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
There is a masive cover up underway of the way Zoetic International (ZOE) has been lying to investors, its few customers and regulators on an industrial scale.Today I expose that cover up. It is no surprise that the FCA is looking long and hard at this company as it confirmed to me in this email late last week. In the wake of the bombshell dossier from eight days ago, HERE, the company has been working round the clock to cover up what it has been doing. However…
The internet is an unforgiving creature and so am I so I will now show you in full detail the full extent of what Zoetic is now trying to hide.
This reaction appears to be a complete admittance of guilt on its part, but as of yet, there has been no public statement regarding these prior health claims and other misleading statements. The scrubbing of this information has extended even as far as editing ‘independent customer reviews’ displayed on its website. This appears to be a further breach of consumer and investor trust and suggests that the independent customer reviews were probably not that independent in the first place. In fact one really wonders if they were from customers at all.
Unfortunately for the company, when I laid bare all its failings, I expected it to try to cover its tracks. So I was sensible enough to capture all the content on its website and social media marketing information to be able to show the deceitful nature of any retrospective moves, while simultaneously staying silent to the stock market on these serious issues. All this deceit and covering up of misleading statements appears to be a rudimentary attempt to hoodwink all stakeholders involved in the Zoetic story.
USA Federal regulatory bodies of the FDA and FTC
The Reg Flag report clearly highlighted that Zoetic’s Chill brands were in violation of federal law as it was selling its CBD smokes and pouches as smoking cessation products. The FDA regulates all medical products, including anything used for smoking cessation, and requires its approval before they can be sold to consumers. Zoetic has neither evidence of efficacy of smoking cessation, nor approval for its products to be sold as a smoking cessation tool. The products are also in violation as they made multiple medical claims across its websites around curing anxiety, depression and inflammation.
The FDA will therefore view its products as unapproved new drugs which do not have authorisation. Accordingly Zoetic’s products should not be offered for sale in the USA until approved and are being sold illegally. The panic purging of virtually every mention of medical claims across all Zoetic’s marketing pages indicates its lawyers have told the company that it is in breach and to avoid being censured with a 15 day Warning Letter from the FDA (requiring all sales to cease in that time) it should quickly remove everything. Unfortunately annexing marketing materials does not change the fact that the products are STILL being sold illegally to consumers in the USA and this has already been highlighted to the FDA. I will now be issuing the FDA with this report to highlight these brazen attempts to fool the FDA so that it can continue to sell unauthorised products to consumers. If the FDA wasn’t already seriously looking at Zoetic, it must surely now do so.
FCA
The FCA requires UK listed companies to act with integrity and transparency and in the best interests of shareholders. This cloak and dagger behaviour breaks multiple FCA conditions for listing. The fact that the company has also changed what are supposed to be independent reviews, goes a long way to showing the level of deception that is going on at the company. Again I urge the FCA to look closely at how the company is behaving since it has pivoted (or was it an unannounced reverse takeover?) into a business that appears to be generating sales from federally illegal sources and is now doing all it can to hide its actions from the FCA by attempting removing multiple smoking guns from its website, while remaining silent to the stock market.
There is a reason why the FCA demands that listed companies should put in place strong corporate governance and Zoetic’s actions, with only the co-CEOs on the Board making all the decisions, and no non-executive board members to oversee matters, is precisely why. The FCA cannot let this carry on any longer and must suspend the shares to protect consumers and market integrity until it can establish the true level of breaches. The FCA has a duty of care to prevent any further retail investors from being allowed to continue to invest capital into this company.
Investors
Retail investors appear to be being misled on multiple levels. Zoetic until last week described itself as a ‘vertically integrated’ CBD company, implying that it captures margin at every step. This has now been changed on its website to being a ‘responsible’ company, which is rather different. The company also put out RNS releases in September 2020 stating that in-store sales were increasing month on month, only to then say in January 2021 there we no in-store sales included in its princely interim revenue figure of £54,000 for the six months to September 30, 2020. The positive product marketing messages around the medical benefits have now been removed, which can only be detrimental to a company whose only business is now trying to promote a consumer brand. Furthermore we can now all see that it is falsifying supposedly independent consumer reviews, which is a cardinal sin for any consumer brand. Add all this to a 2,700% share price rise over the past 12 months and it increasingly looks like all the warning signals are here for a pump and dump programme. I would certainly be interested to know which of the senior management team, old and new, as well as the other reportable shareholders that have been selling into the share price rise? I suspect that the FCA wiull be having a butcher’s at the shareholder register too.
Consumers of Chill products
For the last 18 months Zoetic has marketed to consumers that its smokable products do not contain chemicals, carcinogens and are healthy for you. Furthermore it has claimed that smoking its CBD infused leaves will help anxiety, depression, inflammation and more. Suddenly over night it has removed all these claims. Now the only guidance consumers are left with is that of the Federal Tobacco Commission which states that herbal cigarettes are not good for your health as they contain tar, carbon monoxide and carcinogens. There may well now be consumers of Zoetic smoking products that continue to buy the its smokable products as they believe them to be healthy, when now the opposite is the case. The company should now be forced to reach out to all of its customers to alert them that its view on the safety of their products has changed overnight, as it is trying to dodge Federal scrutiny. Again this is a terrible message to consumers of its brand and further evidence that the management team is not fit and proper to run a listed business or indeed sell products where consumer health is at stake.
About the changes
Below I am able to highlight the changes that have been made to the websites using the ‘Internet Archive – Wayback Machine’. This website periodically captures the content on websites across the web and most of the Zoetic websites have been captured in the last 2 months. You can thus compare these captures to the current versions of the website to show the changes that have been made. I have also downloaded versions of all full sites both before and after the changes using SiteSucker, which can also be viewed to compare.
Where sections have been changed rather than removed completely I have highlighted the relevant text with an underline. This is not a few small changes, this is a wholesale and panic purging of all marketing messages with the sole intent to protect the company from federal and FCA scrutiny and shows no regard for the multiple health risks for US consumers of their products.
Original quote completely removed: ‘A chill way to quick tobacco and experience CBD’
Original quote completely removed: ”Though CBD research is still in its infancy,thus far, CBD shows potential for general wellness. It appears that CBD has an anti-inflammatory effect, which may be why it shows promise to manage chronic pain. There is also a growing body of research on CBD for anxiety disorders that support the idea that CBD can be used for relaxation.”
Original quote completely removed: “Beyond that, CBD is currently being studied for its promise in helping with many different health concerns, from heart health to depression to dementia. While more research needs to be done on these potential benefits, please consult your physician for more information. Chill does not make any health claims via CBD”
Original quote: “Are you looking for a way to kick your nicotine habit? Whether you chew tobacco or smoke cigarettes, our CBD products offer an alternative for you. When you smoke our CBD pre rolls or chew our CBD pouches, you go through the same ritual as you do with tobacco, but you have organic herbs instead of the tobacco and nicotine.”
Current quote: “Are you looking for a recreational tobacco & nicotine alternative? Whether you chew tobacco or smoke cigarettes, our CBD products offer an alternative for you. When you smoke our CBD or chew pouches, you go through the same ritual as you are familiar with.”
Original quote completely removed: “Tobacco controlling your life? Our hemp products offer the same opportunity to relax, without all the toxic chemicals that come with tobacco. Forget tobacco — why not Chill Instead? Shop our tobacco alternatives here today”
Original quote: ‘Zoetic is a vertically integrated CBD business with operations in the US and UK’
Current quote: ‘Zoetic is a responsible CBD business with operations in the US and UK.’
Original quote: ‘Zoetic is a vertically integrated CBD company, listed on the London stock exchange.’
Current quote: ‘Zoetic is a responsible CBD company, listed on the London stock exchange.’
Original quote completely removed: ‘Although supplying “from seed to shelf” and being vertically integrated, the Company’s focus is at the higher margin beginning and end of the hemp/CBD lifecycle, seeking to develop reliable and high quality feminised hemp seeds as well as manufacturing and retailing premium brands..’
Original quote completely removed: ‘16 acres of hemp planted outdoors in Palisade, Western Colorado provide Zoetic with sufficient CBD for its own uses. The Company farms organically, using no chemical pesticides or herbicides, and so is able to control the quality of its CBD and therefore its retail products.’
Video of Ex-CEO removed from ‘Home Page’
Unique Holiday Gift Ideas
What is CBD Chew
Original quote completely removed: ‘Chewing CBD pouches is a great way to satisfy your craving…Lets take a look at some of the major benefits of using CBD chews…many benefits have been found. These include Managing chronic and non chronic pain; Increasing relaxation; Reducing stress and anxiety…CBD can be effective to help with depression and anxiety’
Original quote completely removed: “…studies on CBD are still in the early stages but…include Managing chronic and non chronic pain; reducing stress and anxiety; taking the place of nicotine…you will see for yourself how CBD can work wonders for you and your body”.
Will CBD Smokes Help Me Relax
Original quote: “The simple answer to this question is yes. CBD has several different benefits, and one of those benefits is relaxation. CBD has been shown to have relaxing qualities and to help fight stress and anxiety. When used regularly, it can even help with depression “
Ways To Relax When Stress Hits
How to Use CBD Dip
Original quote completely removed: “Our CBD dip is filled with, you guessed it, CBD! So what is CBD and why is it known for providing some great health and wellness benefits to its users? Relaxation; Stress and anxiety; helps with depression; relieves chronic pain…these benefits, and many more, are just some of the many reasons why using CBD dip is better than tobacco dip”.
Will CBD Smokes Help Me Relax:
Original Quote completely removed: “CBD smokes are an excellent alternative to smoking cigarettes, as they still give you the sensation of smoking, but rather than harmful chemicals, you are smoking natural herbs which may offer benefits… CBD has been shown to have relaxing qualities and to help fight stress and anxiety. When used regularly, it can even help with depression… Using CBD smokes can be a great way to fight anxiety, as well as take the edge off. CBD can also help with pain relief and is the perfect alternative to nicotine.”
Is CBD-Hemp Tobacco Right For You:
Original Quote completely removed: “Smoking can be a very addictive habit, yet most people know that it is not a very healthy one. However, hundreds of thousands of people still smoke tobacco all over the world. But what if we told you that there are new alternatives potentially healthier to smoking tobacco? What if we told you that hemp smokes could satisfy your cravings and may be good for your overall well-being? Yes, that’s right! Chill Hemp Smokes contain no tobacco or nicotine and approximately 100mg of CBD per pack for micro daily relief.”
Is Vaping Better Than Smoking:
Original Quote completely removed: “While smoking anything can have negative effects on your lungs, there are certain products such as Chill CBD smokes that are all natural and made with only organic products. Even the paper is 100% natural hemp. There are never any additives or chemicals in Chill CBD smokes so you can smoke in peace and ease your mind. You should always keep in mind the side effects of smoking, but Chill CBD smokes are an excellent alternative to smoking cigarettes which contain carcinogens and many other harmful, toxic chemicals.”
Alternatives To Smoking Cigarettes
Original Quote completely removed: “Are you looking for an alternative to smoking cigarettes? Do you like the idea of smoking, but don’t want the nicotine and other harmful substances contained in cigarettes? Interested in trying CBD? Well, then The Chill Way has what you are looking for.”
How to Quit Tobacco for Good
Original Quote completely removed: “CBD may be just what you need. The Chill Way offers a variety of products that can easily take the place of tobacco and give you the satisfaction of smoking or chewing without the harmful chemicals…if you are ready to turn your life around, then check out Chill CBD products and stop using tobacco today. You will get the same sensation of smoking and chewing, but will be filling your body with natural, organic herbs rather than harmful, toxic chemicals”
Introducing Mint and Calm Smokes
Original Quote completely removed: “Because herbal smokes are much better than tobacco, they can be used to quit tobacco. In many cases, the herbal smoke can eliminate the urge to smoke tobacco completely. Unfortunately, you will still experience nicotine withdrawal, but herbal smokes can help curb the cravings more quickly.”
Best Ways to Smoke CBD
Original Quote completely removed: “Smoking CBD is a great alternative to cigarettes because CBD has shown to have some important health benefits, whereas cigarettes are full of carcinogens and harmful chemicals… These pre rolls are excellent if you prefer the feeling of smoking a cigarette, but don’t want the nicotine and harmful chemicals. Chill CBD Smokes are one of the best options for smoking CBD as they are already rolled and packaged, don’t contain any harmful chemicals, and contain all organic, natural substances.”
Antonio M.
Eric S.
“Wow, I always wondered with the CBD industry trending up, if someone would make a product like this. This product is GREAT!. I am a very busy person with lots on my plate, this product keeps me relaxed and definitely helps curb anxiety. Can’t wait to try the new flavors!”
Current Review: Wow, I always wondered with the CBD industry trending up, if someone would make a product like this. This product is GREAT!. I am a very busy person with lots on my plate, this product keeps me relaxed. Can’t wait to try the new flavors!
Original Review: “Used these to help with nicotine quoting and works perfect!!”
Original Review: “I quit nicotine lozenges/dip right as COVID started as my anxiety and physical symptoms of doing so much nicotine over 10+ years. I needed a better and healthy substitute as that habit was starting to deter my day to day well-being.”
Original Review: “These pouches are an amazing alternative to my Copenhagen addiction. Keep up the great work!”
Original Review: “My co-workers and I have all quit smoking and chewing tobacco using these products”
Original Review: “I have been trying to quit tobacco and this is a great alternative.”
Original Review: “I love the cbd smokes! They are tasty (red raspberry really stands out). Only thing is, I wish we knew more about the effects on health. I doubt it is that bad, akin to smoking legal marijuana. However, it would be nice to confirm this information. Otherwise, very clear-headed, tasty, and relaxing effect. Go for it!”
Original Review: “The effect is great, better than cbd oik as the MCT oil usually upsets my stomach. Not these! Perfect! Would be great if more about health effects was known/listed. Anyways, pouches are great and are probably fine.’
Original Review: “When I found this product I was looking for something to replace my tobacco habit. Let me vouch, this product did exactly that. Not only did I instantly feel the effects of calm satisfaction, it felt great knowing that this pouch is a healthy alternative! Now days I hardly chew tabacco, but when I need something to take the edge off, I just pop one of these in and just chill;)”
Original Review: “You guys product have saved my life with my anxiety”
Damiana herb “…known for its distinctive flavor and aphrodisiac effects. Native Mexicans drank sweetened Damiana tea as a relaxant, and it’s thought to be one of the original ingredients in margaritas. Today, it is used primarily for its anti-anxiety, anti-depressant, and libido-stimulating properties.”
Lavender herb “You’re probably used to seeing lavender is soaps, teas, candles, essential oils, and potpourri, but you may not realize you can smoke it. Lavender is often used in aromatherapy for relaxation, and smoking provides a similar, calming effect. Lavender is thought to be effective in relaxing anxiety and stress, addressing sleep issues, aiding skin and hair care, providing an anti-inflammatory effect, and promoting heart health.”
Lobelia herb “Lobelia has a long history as a nicotine replacement and has many homeopathic uses. Lobelia contains lobeline, similar to nicotine, which may be why it is effective for easing smoking cravings. It is also known as a great herbal treatment for a variety of respiratory issues, and may help relax muscles and promote blood flow.”
Motherwort herb “Motherwort is a perennial plant that is often used in Traditional Chinese Medicine (TCM). This herbal remedy may offer a whole bevy of benefits to your health. Some include helping with anxiety and panic disorder, insomnia, and heart conditions. It’s known to be anti-inflammatory and analgesic and is used to treat a variety of women’s issues.”
Mugwort herb “Mugwort refers to several aromatic plants in the genus Artemisia. Mugworts are commonly used in Traditional Chinese Medicine. They may provide a boost of energy, and are used to treat a wide variety of medical concerns, including digestive issues such as diarrhea and constipation, women’s issues such as irregular periods or other menstrual problems, and mental health issues such as depression and anxiety.”.
Mullein herb “Mullein, also known as the Verbascum flower, has been used as an herbal remedy for quite some time. Though a relatively new phenomenon in North America, it has been used in traditional Austrian medicine for centuries, both as a tea and a topical. Mullein is believed to be beneficial for disorders of the respiratory tract, gastrointestinal tract, skin, veins, and locomotor system. Mullein is flavorless and produces a very light smoke, making it a great base for an herbal cigarette.”
Passion flower “The distinctive passion flower has long been used by Native Americans, traditionally made into a tea to treat insomnia, hysteria, and epilepsy. Today, passion flower shows great promise in treating generalized anxiety disorder. Passion flower stabilizes mood, promotes better sleep, controls muscle spasms, and lowers blood sugar.”
Red Raspberry Leaf herb “Red raspberry leaf has been smoked for centuries. Historically, Native American women would smoke red raspberry leaf during certain religious rituals and ceremonies, as well as for certain health treatments. Raspberry leaf is a fantastic alternative to tobacco that contains no nicotine but a variety of medicinal compounds, including flavonoids, tannins, phosphorus, potassium, calcium, ellagic acid, and vitamins A and C. It’s known to lower blood sugar, ease pain from childbirth, increase fertility, enhance collagen production in the skin, and it produces a sedative effect.”
Bearberry herb “Usa-ursi, also known as Bearberry, has been smoked for centuries as part of Algonquin ceremonies. Smoking this plant is marked by a smokey flavor and stimulating effect. It is used in homeopathy to treat a variety of conditions, including urinary tract infections, contact dermatitis, and arthritis.”
Conclusion
This company is trying to cover up claims it makes which deceive and mislead potential consumers and investors and show that it is in brazen contraverntion of FDA guidelines. I am afraid that just because you have stopped beating your wife the authorities will still have your gonads for past crimes and the FDA has always taken this approach to regulation. I have already reported Zoetic to the FDA with my original dossier. Today I shall pass it the evidence of the cover up.
As for UK investors. You have backed a company that creates bogus client reviews but still cannot generate any meaningful sales! It has lied to you via RNS and you still think this is a good investment? Whatever: my target price is now reduced from a 0p-5p range to a straight zero. This company has committed fraud and in the end frauds always run out of other folks cash.
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