Newsweek, Olivet get heat for PPP loans

NEWSWEEK and Olivet University are drawing fire for receiving coronavirus stimulus loans following their involvement in a $35 million money-laundering scheme that has resulted in guilty pleas by former executives of the media company and the college.

Olivet University, founded by followers of controversial KoreanAmerican cleric David Jang, landed a $500,000 loan under the federal Payroll Protection Program administered by the Small Business Administration.

Newsweek, whose parent company IBT Media at the time of the scandal also was run by followers of Jang, reportedly received $350,000 in PPP money.

The loan application includes a question about involvement in fraud over the previous five years. The Manhattan District Attorney’s office brought the charges two years ago. After obtaining guilty pleas in February, the DA said the executives responsible for the scheme had been removed by the time the pleas were entered.

But that has not stopped a government watchdog from criticizing the nearly $1 million in loans to the two entities.

“That these two organizations mired in a fraud and embezzlement scandal were able to access PPP loans, all while actual small businesses were shut out, underscores the fatal flaws of this program,” said

Kyle Herrig, president of Accountable.US, a watchdog group. “Grossly inadequate oversight and inept implementation meant this program would be botched from the beginning and exploited by bad actors. And indeed it was.”

The culmination of DA’s 17-month grand jury probe occurred in January 2018, when officers raided Newsweek’s offices and carted away 18 computer servers. There also was a subsequent raid on an Olivet facility that was the home of the abandoned Harlem Valley Psychiatric Center that yielded no computer servers.

Olivet pleaded guilty in February to one count of conspiracy and one count of falsifying business records, and agreed to pay a $1.25 million fine over the next 24 months. Its former chairman of the board, Andrew Lin, has been barred from having any affiliation with the Bible college for two years.

Newsweek’s involvement was limited to money funneled to then-parent company, IBT Media. Etienne

Uzac, former co-owner of IBT, pleaded guilty in February and received a non-jail sentence. Olivet spokesman Ronn Torossian said the SBA approved a loan amount of around $500,000 for the college.

“The PPP funds have been used in the covered eight-week period after receipt of the loan exclusively for covered expenses. We have been affected by the pandemic, as have many other universities,” he said.

“Nobody on the current board of the university was convicted of a felony charge at the time of the PPP application. Any previously indicted individuals had left the board long before the university had decided to apply for the PPP.”

A spokesman for Newsweek didn’t return a request for comment.

Lower Times

Hightimes Holdings, owner of stoner magazine High Times, appears to be coming down from its marijuana-legalization buzz, thanks to the coronavirus.

The flagship publication has not produced a print version since April due to the coronavirus, and has laid off its staff. Chairman

Adam Levin said he has since restaffed and hopes to return to printing High Times next month, even as two other print mags acquired in 2018, Dope and Culture, remain suspended indefinitely.

“We believe our media business is a key part of our expansion plan,” said Levin, whose hedge fund Oreva Capital bought High Times in 2017.

Meanwhile, five ex-High Times staffers have joined with rival company Leaf Nation to introduce Leaf Northeast in September, including

Danny Vinkovetsky, a High Times columnist for 20 years who wrote under the pen name Danny Danko until he was laid off in March.

“They have been the voice of marijuana media since 1974, and it’s a shame to see that seemingly coming to an end,” Vinkovetsky said.

Separately, the company has been directed by the Securities and Exchange Commission to suspend its crowd-sourced initital public offering effort until it is able to bring its financial filings up to date. Its last public filing dates back to May 20, 2019, when the company reported a net loss of $41.2 million on $14.7 million in revenue for 2018.

In an effort to ride the pot-legalization wave, High Times has been increasingly turning to selling cannabis and generating cash by licensing its name to dispensaries in the booming cannabis retail market.

Levin said in June that he signed a $25 million licensing deal with Red White & Bloom dispensaries that will pay $10.5 million in cash over the next 18 months and give it $15 million in RWB stock, which trades on the Canadian Securities Exchange.