CannTrust Crack-Down, Can We Trust?

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CannTrust Crack-Down, Can We Trust
CannTrust Crack-Down, Can We Trust

In recent cannabis news, the Ontario-based cannabis producer CannTrust was sanctioned by Health Canada for unlicensed cultivation of cannabis. The Canadian company had been giving inaccurate data to federal regulators from October to March.

Furthermore, Health Canada determined the business was cultivating cannabis in five unlicensed grow rooms.

This noncompliance has caused the Canadian medical cannabis company CannTrust (CTST) stock to drop 22.5% in shares.

Upon the stocks plummet, the CannTrust Twitter account posted the following message:

Canntrust Twitter

“If you’re a patient and have questions or concerns about today’s news, please call our Customer Care team at 1-855-794-2266 or email customerservice@canntrust.ca. If you are an investor, please email investor@canntrust.ca. For general inquiries, email communications@canntrust.ca.”

Angry citizens took to Twitter to voice their opinions on the company being caught red-handed, or should we say “green-handed.”

Twitter user Eamon Cry tweeted:

Statement for our investors: “You were funding illegal activity on our behalf, nothing will happen to our license or your investments because companies aren’t held to the same standards as the individual, so we can break the law so long as we pay lots of money to the right ppl”

Moreover, a current (27,500 pounds) of CannTrust cannabis is on hold, which may create a surge in product curtailments for Ontario’s medicinal patients.

Since March of 2018, Health Canada has found “63 major” observations that violated cannabis compliance. A farmer is noncompliant based on the importance of the infraction discovered by Canada’s health inspectors.

The investors will have to await news regarding the real financial impact. The wait is due to Health Canadas pending examination (which may take several weeks to complete).

The Trust In CannTrust Broken

Sadly, before the mishap, CannTrust had assets valued at 21.8 million Canadian dollars. Shares traded on the New York Stock Exchange and Toronto Stock Exchange (TRST).

Indeed, questions are lingering, such as what does Cannatrust have to say regarding the entire matter? In fear of the regulatory move, CannTrust reported it would contribute more to its employee training program. Consequently, this move may be a bit too late after seeing how investors are reacting.

Lastly, the cannabis company announced it had hired consultants for an objective review of its compliance rules. Is the “trust” in “Cannatrust” gone, regardless of what the company does to rebrand its image?

 

Please write your thoughts on the distrust of CannTrust in the comments area below.

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