California-based cannabis giant Stiiizy is under investigation by New York’s Office of Cannabis Management (OCM) for reportedly smuggling marijuana products from other states into New York’s licensed retail stores.
The probe, initially reported by The New York Times, involves several companies, including Stiiizy, Grön, Mfused, To the Moon, Turn, and Waahoo (the house brand of Long Island-based processor Omnium Canna).
OCM officials conducted a surprise audit of Omnium Canna’s operations on Long Island. Stiiizy CEO James Kim denied the allegations, asserting that the audit confirmed compliance with New York regulations. Similarly, Grön representatives refuted claims, stating the company was not under investigation.
The accusations revolve around “inversion,” a practice involving inserting marijuana products produced outside regulated systems into a licensed supply chain. OCM recently established a Trade Practices Bureau specifically to investigate regulatory violations, including inversion.
Stiiizy, already facing separate legal challenges over alleged illegal business practices and inappropriate marketing strategies, is one of the most prominent cannabis brands involved in these allegations. The ongoing investigation highlights broader concerns within New York’s cannabis industry regarding regulatory compliance and the presence of unauthorized products in licensed markets.
