Fugazi Research alleges deliberate deception in that the company continues to present itself as a cannabis company on social media and in paid promotions while having generated no cannabis revenue since February 2025, misleading momentum traders buying on marijuana reclassification news. The First Towers acquisition involved Christopher Cooper, who was simultaneously a director of Akanda and a co-founder, shareholder, executive, and director of First Towers, constituting a related-party governance failure. The company's structure — six reverse splits, toxic convertible notes at 85% VWAP discounts, and $6.725 million paid to a promotional firm from note proceeds — is a textbook dilution loop rendering the equity structurally uninvestable.

Fugazi Research's analysis is grounded in SEC filings including Forms 20-F, F-1/A, 6-K, and NT-20F, from which specific financial figures, debt terms, conversion mechanics, and promotional payments are sourced; analytical work includes calculating the cumulative reverse split ratio of approximately 1-for-56,340, the 12x float overhang from registered conversion shares, and the $18-spent-per-$1-earned operating loss ratio for 2025.

Not Present: Primary

The company has explicitly stated Board authorization for additional reverse splits up to a cumulative 1-for-100 ratio without further shareholder approval, and the January 2026 convertible notes at an 85% VWAP discount floor create ongoing conversion and resale pressure as a pending structural catalyst. Absent that, Fugazi Research argues the thesis alone — a sub-$300k revenue business carrying $26 million in debt with 12x float in registered conversion shares — is sufficient to render the equity worthless.

Not Present: Specific Event

Cannabis Pivot Concealed from Retail Investors

Fugazi Research alleges that Akanda has not generated any cannabis revenue since February 2025 and has no disclosed plans to resume cannabis operations, yet its social media accounts have not been updated since November 2022 and still promote cannabis imagery and its Portugal grow facility, which was sold in early 2024. The company's paid promotions referenced its Mexican fiber business rather than cannabis, yet retail buyers purchased shares on the Trump administration's marijuana reclassification news in April 2026, unaware the company had already exited the sector.

Toxic Dilution Loop Funded by Promotional Spending

Between September 2025 and January 2026, Akanda raised $19 million in convertible notes and directed $6.725 million (approximately 35% of gross proceeds) to IR Agency, LLC, a retail stock promotion firm. Fugazi Research characterizes this as a documented dilution loop: raise convertible notes, pay promoters to drive price, allow note holders to convert at an 85% VWAP discount, watch price fall, execute a reverse split, and repeat. The company has conducted 10 total capital raises since its IPO totaling approximately $46 million, or roughly 30 times its standard market capitalization.

Six Reverse Splits in Three Years, More Authorized

Since March 2023, Akanda has executed six reverse stock splits with a cumulative ratio of approximately 1-for-56,340, the most recent being a 1-for-4.5 split in April 2026. Fugazi Research notes that the company's Board has been authorized to execute additional splits up to a cumulative ratio of 1-for-100 without further shareholder approval. Adjusted for the cumulative split history, the current price equates to a pre-split value Fugazi Research estimates in fractions of a penny, consistent with distressed microcap levels despite the nominal share price.

First Towers Acquisition: Related-Party at Premium Leverage

Akanda's August 2025 acquisition of First Towers & Fiber Corp. involved Christopher Cooper, who was simultaneously a director of Akanda and a co-founder, shareholder, executive, and director of First Towers, as disclosed in the Form F-1/A. Cooper recused himself from the Akanda board vote and was removed from the audit committee for the transaction. The acquisition added a $14.1 million note at 16% interest secured by substantially all of Akanda's assets, and total debt expanded from $3.64 million to approximately $26 million (a roughly 7x increase) as Akanda assumed First Towers' pre-existing liabilities at closing.

Revenue Collapse Renders Business Economically Inviable

Akanda's revenue declined from $2.6 million in FY2022 to $2.1 million in FY2023, $836,664 in FY2024, and approximately $258,075 in FY2025, the last figure representing less than one-twentieth of its $4,827,720 in total operating expenses and less than one-third of salary expenditures alone. Fugazi Research calculates an operating loss ratio of $18 spent for every $1 earned in 2025, while the accumulated deficit stands at $57.4 million against $63.3 million in total paid-in capital since inception, meaning the company has lost 91 cents of every dollar ever invested in it.