Article by CityNews Toronto
CannTrust Holdings Inc. has fired its CEO and asked its chairman to resign after the board discovered new information during an internal investigation into alleged unlicensed pot growing by the cannabis producer.
The company’s board of directors decided to “terminate with cause” chief executive Peter Aceto, the company said in a statement released after markets closed Thursday.
The move comes after several media reports cited internal documents that suggest Paul and Aceto were aware of pot cultivation in rooms at a Pelham, Ont., facility without government approval months before Health Canada discovered the illicit activity.
The board also demanded company chair Eric Paul resign, which he did. It added that it is preparing to make additional operational changes in the following days and weeks.
The shakeup comes as the board’s special committee uncovered new information during its ongoing investigation into the company’s failure to comply with Health Canada regulations.
Health Canada discovered during an unannounced inspection in June that the pot firm was growing cannabis in several rooms before securing appropriate licences. The agency is currently investigating CannTrust.
The board has appointed the special committee’s chair Robert Marcovitch as interim CEO and he will no longer be a member of the committee.
“Our first priority is to complete the remaining items of our investigation and bring the company’s operations into full regulatory compliance,” Marcovitch said in a statement.
The role of special committee chair will be assumed by Mark Dawber.
CannTrust’s stock has fallen more than 40 per cent since early July, when it disclosed Health Canada’s findings that the company had grown cannabis in several rooms. The company said the unlicensed pot growing in question took place between October 2018 and March 2019, before the licences were issued for these five rooms in April 2019.