SEC v. C-Hear, Inc., Adena Harmon — U.S. Securities and Exchange Commission Litigation Release No. 26486, dated February 20, 2026.
The SEC charged C-Hear, Inc. and its former CEO, Adena Harmon, with securities fraud for allegedly misleading investors about the company's technology and concealing Harmon's criminal past. Harmon also faces charges for misrepresenting another company's business and misappropriating funds from both C-Hear and Elite Performance Data Labs.
In Plain English
Imagine you're selling lemonade. You tell people your lemonade is super special, maybe that a famous chef tasted it and loved it, and that you've already sold tons of it. You also don't mention that you've been banned from selling lemonade before. Then, you take the money people give you for lemonade and spend it on yourself instead of making more lemonade. That's kind of what happened here, but with a tech company and stock.
Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.
How the Alleged Scheme Worked
- Misleading Technology Claims Between January 2019 and October 2023, C-Hear representatives, including CEO Adena Harmon, falsely told investors that the company's primary software product was undergoing trials with third parties. They also claimed the federal government had tried and failed to hack one of C-Hear's products, a claim intended to impress potential investors with the product's security.
- Concealing Criminal Past During investor solicitations, Harmon and other C-Hear representatives deliberately failed to disclose Harmon's extensive criminal background. This included numerous convictions for financial crimes, such as theft by check, which would have been critical information for investors assessing Harmon's trustworthiness.
- Unauthorized Bank Accounts Harmon allegedly opened two bank accounts in C-Hear's name without the company's knowledge or authorization. She then directed at least three investors to deposit their investment funds into these personal accounts, blurring the lines between company funds and her own.
- Misappropriation of C-Hear Funds After investors deposited funds into the unauthorized accounts, Harmon misappropriated approximately $641,000. She used these funds for personal benefit, including luxury shopping trips and to satisfy an outstanding criminal restitution order, rather than for C-Hear's business operations.
- Misrepresentations for Elite Performance Separately, Harmon allegedly made false claims to investors in another company she controlled, Elite Performance Data Labs, LLC. She falsely stated that the Dallas Cowboys had placed a multi-million dollar order for Elite Performance's products, implying a significant business deal that did not exist.
- Misappropriation of Elite Performance Funds Harmon also misappropriated nearly all of the $405,000 raised from Elite Performance investors. These funds were allegedly used for her personal expenses, another business venture, and to cover C-Hear's expenses, further demonstrating a pattern of commingling and misuse of investor capital.
The Enforcement Action
On February 19, 2026, the SEC charged Texas-based C-Hear, Inc. and its former CEO, Adena Harmon, with securities fraud. The SEC alleges they made misleading statements about C-Hear's technology and concealed Harmon's criminal history. Harmon is also charged for misrepresentations regarding Elite Performance Data Labs, LLC and misappropriation of investor funds from both companies. The SEC seeks permanent injunctions, civil penalties, and disgorgement with prejudgment interest against Harmon and C-Hear.
Named in this action: C-Hear, Inc., Adena Harmon.