As the global cannabis industry expands, those in the supply chain are facing increased risk of security threats.
The cannabis industry is growing rapidly across the globe.
As the sector expands, so does the number of grow operations, warehouses and dispensaries which all house high-value, highly regulated substances that many are willing to risk prosecution to lay their hands on.
It comes as no surprise then that cannabis companies are at a high risk of security threats such as robbery and theft.
And it’s not just the products themselves that are at risk.
In the US, as cannabis remains illegal on a federal level, many firms struggle to open business accounts with mainstream banks, meaning that dispensaries often require its customers to pay in cash. This only adds to the sector’s susceptibility to break-ins.
Unfortunately, cannabis companies must also be wary of their employees. As the black market continues to thrive in spite of legalisation efforts, dispensaries and cultivators have to keep an eye on their employees who may see an opportunity to swipe their employer’s products to sell on the illicit market.
Due to these risks, some US territories have made it mandatory for cannabis dispensaries to submit their security plans to local law enforcement for approval before being allowed to open.
Cannabis Health sat down with security expert Scott Thomas over Zoom to find out more about the security challenges faced by the cannabis sector.
Thomas is the national director of signature brands at Genetec, a security company that has become a popular choice in North America for cannabis companies looking to keep their premises safe and secure.
Currently, in the US, 16 states have legalised cannabis for recreational use and 36 states have legalised medical cannabis. On a national level, the substance is still illegal, so regulations can differ significantly from state to state.
Thomas said: “Each one of those states is going to have very specific regulations and requirements.
“They want to make sure that the product is totally safe from seed to sale, that it is absolutely contained and that there is no potential harm or any type of additives that can be put into the crop.
“They also want to make sure that all the sales are done legally, they want to make sure that there’s proper verification of the age of the purchaser, and they want to make sure that if it’s from a medicinal standpoint, there’s an actual prescription. There are quite a few physical security requirements to guarantee that those regulations are followed.”
Thomas breaks down the security requirements into three categories; video, access control and intrusion notification.
What sets the cannabis industry apart from other regulated markets, he said, is the requirement for video retention in many US jurisdictions, some of which ask for a record of up to two years of video footage.
As any discrepancies in inventory could lead to large fines and other penalties, Thomas stressed the importance of keeping products under constant surveillance at every stage of the seed to sale process.
Thomas said: “[One of] the most fundamental requirements, and this is absolutely germane across all the jurisdictions, countries and states that we deal with is video.
“There needs to be video evidence, and this is where some of these regulations vary quite a bit.
“In some cases, they will require the entire cultivation growing area, the processing area where the product is packaged for consumption or possibly turned into other products, the retail area where it is sold and the warehousing or the storage area where it is kept.
“All of those things need to be under observation. If there are any discrepancies in inventory they need to be able to go back and try and identify where it happened.”
If a camera is to go offline for any reason, the company is required to make the regulator aware as soon as possible and have a backup device on hand to ensure video footage continues to be captured.
“All cameras and systems have built-in ‘Genetec Health Monitoring’ inside of them. If, for example, a camera were to stop working for whatever reason, it gives them that notification.”
Access control is another key factor in keeping cannabis operations secure, Thomas continued: “This includes locked doors, credentialed employees, limiting access and the ability to audit who has the authority to enter those areas and make sure that only those people go into those restricted parts of the establishment.”
The cannabis sector is one of the fastest-growing industries in the world right now. Companies are expanding quickly and as an increasing number of territories are legalising the drug, cannabis firms are eager to expand into these new regions. But, with that comes yet another set of regulations.
Thomas uses one of Genetec’s clients, an unnamed US company that is trading publicly on the New York Stock Exchange, as an example: “What they have done is looked at the most stringent regulations they’re currently using in a given state and then mirrored that across all of their different locations.
“Their thinking is that regardless of regulations getting more stringent or eased up, they’re going to be absolutely protected across that entire enterprise; none of their sites will fail to meet that regulatory requirement.”
The firm has also centralised its security operation centre – known in the industry as a ‘sock’ – which, according to Thomas, is “unique” for companies of this type: “By doing this, they’re able to understand if there are violations of their own protocols with regards to people trying to access areas that they shouldn’t and they have our intrusion alarm integration built into that system so if there’s a break-in they’ll know.
“These are some of the unique things that we’ve built. With the Genetec platform, we’re able to put all of that into a single pane of glass. And since we are software, our product scales very easily.”
Another common problem faced by cannabis dispensaries in particular is people attempting to purchase more cannabis products than is allowed under local regulations.
Some states, for example, prevent individuals from purchasing more than a certain amount of cannabis over a given time. This means verification and identification is vital to ensure cannabis dispensaries are not enabling unlawful sales.
Genetec interfaces its video system with identification information to prevent a customer from using a fake, borrowed or stolen ID to buy more than their allowance.
Based in Montreal, Genetec became involved in the cannabis sector as the plant started to gain acceptance in Canada several years ago. The company produces software platforms to support physical security devices and since launching in 1997, it has become the largest manufacturer in the world of this type of technology.
The company now works across the North American continent, keeping cannabis grow-ops, storage facilities and dispensaries safe and secure.
Currently operating in the US and Canadian cannabis sectors, Thomas says that Genetec intends to expand into the EU market, including the UK, as the cannabis sector continues to open up.
Thomas added: “We will absolutely be at the forefront of trying to work with the folks that want to start businesses there and get them up and rolling.
“We anticipate the same security requirements would be applied in these different countries and jurisdictions as we’re seeing in the US and Canada.”