Fallout over illegal grow rooms widens at CannTrust

By Enzo DiMatteo


By Kieran Delamont

True scandal is pretty rare in the cannabis world, but CannTrust, the Ontario-based LP caught by Health Canada growing weed in unlicensed rooms earlier this month could lose its license. And those responsible could face up to 14 years in prison under the Cannabis Act.

Late Thursday (July 25), the company fired its CEO, Peter Aceto and president Eric Paul resigned after its stock value fell some 60 per cent in recent weeks.

Earlier in the month, a whistleblower told Health Canada that the company had ordered him to hide thousands of plants from government regulators in various facilities behind fake walls. According to some media reports, company execs were aware of the illegal grow rooms which produced some five metric tonnes of pot. And that some of that product was shipped for sale abroad.

Now, the company is laying itself at the mercy of federal regulators. A special committee has been appointed to investigate and Health Canada has put a hold on CannTrust product.

Cannabis companies have historically been given light slaps on the wrist for violations in the past.

Winnipeg-based cannabis producer Bonify, for example, was straight-up passing street weed off as regulated product, and while the company still hasn’t had its sales license suspension lifted, they expect to eventually after the RCMP announced in March that the company would not face any criminal charges.

The feds may be notorious tight-asses when it comes to the rules, but so far they haven’t shown much of a willingness to carry a big stick when it comes to doling out punishment for violations. This one, however, will be difficult to sweep aside. Some in the industry are calling CannTrust’s actions a “gross wilful violation” of the Cannabis Act.

Read more over at The Leaf.

View: 3