Jean Cronin, Executive Director, CT Package Stores Association
By Jean Cronin, Executive Director, CT Package Stores Association
In late July, news broke over allegations of what was deemed to be a fraudulent cannabis license scheme that was being shopped around to retailers. The scheme was under the business name of MAKECTBETTER LLC, where one of the principals was based in Fairfield. The scheme claimed to be able to sell retailers a cannabis license through the Department of Consumer Protection (DCP). The owners of the business claimed to have “connections” with state officials who were high-ranking within the DCP and other agencies who could provide cannabis licenses.
The two principals of MAKECTBETTER LLC would provide a price—sometimes as much as $30,000—that the retailer would have to pay to obtain the license. The scheme claimed that a portion of the money was needed to pay the state and the business (fraudulent LLC), while the rest of the money was needed to purchase the necessary
cannabis products.
Forged documents allegedly issued by the DCP and the State of Connecticut were shown to the retailer, who was told they were authentic. The money that the retailer paid for the cannabis license and “fees associated with the license” was stolen by the principals of MAKECTBETTER LLC and the retailer was out that money.
In Connecticut, cannabis retail licenses and cannabis products are highly regulated. The process for receiving a retailer, a hybrid retailer, a dispensary facility or an infused beverage license is all operated by the Department of Consumer Protection and has a regulated process to obtain those listed permits.
It is important to understand that retailers cannot sell cannabis products if they do not have the appropriate license. MAKECTBETTER LLC is accused of committing numerous violations of the Connecticut Unfair Trade Practices Act with its fraudulent scheme against retailers. The Connecticut Attorney General’s Office has filed a lawsuit against the LLC, seeking a $2.5 million prejudgment remedy, which would prevent the two owners of the LLC from offloading or shifting resources that could evade accountability, according to a press release by the Attorney General’s Office.
In addition to this news, local and state law enforcement have been cracking down on local smoke shops and other retailers who are selling illegal cannabis products. With the assistance of Attorney General William Tong, raids have been conducted on smoke shops and convenience stores that have sold unregulated cannabis products.
This year in Stamford, local and state law enforcement conducted investigative operations on eight Stamford smoke shops who were believed to be selling illegal cannabis products. In those raids of the eight stores, 4,280 illegal products were seized by officials. The shops selling illegal products were given fines, and the owners and employees are facing criminal penalties. Seven of those shops were issued a stop work order by the Department of Labor.
It is important for store owners to understand what products can and cannot be sold in their stores. Many of the products seized exceeded the legal percentage of THC allowed. Make sure to be compliant with all aspects of the law when selling THC-infused beverages, including having the proper DCP endorsement to sell the products and ensuring that they do not exceed the per-container limit of 3 mg.
Also make sure any advertising of these products, including on websites, is compliant with the laws and regulations. The Department of Consumer Protection is conducting inspections of all licenses under the agency’s jurisdiction. Make sure to be in full compliance of the law to avoid any unnecessary issues.
Jean Cronin is the President of Hughes & Cronin Public Affairs Strategies, where she is responsible for developing and implementing legislative initiatives for the firm’s clients, and directing a variety of trade and professional associations managed by the firm. Cronin joined the firm in 1986 after serving as a communications strategist for the Connecticut Senate Majority Office, where she became well-versed in the politics and insight of the State Capitol. She is the Executive Director of the Connecticut Package Stores Association, following the passing of longtime director, Carroll J. Hughes.
