Weighing Cannabis-Looping For Diversion

We recently joined the Association of Certified Commercial Cannabis Experts (ACCCE). The association brings together like-minded risk and compliance professionals who collaborate to identify and provide solutions to risks affecting the cannabis industry. As we reviewed some of their resource material, we found an article about “Looping,” which is a tactic used by individuals to purchase cannabis products in excess of the legal limit. The article was written by Brion Nazzaro, President of ACCCE. We found it to be informative and definitely worthwhile for anyone who is associated with the cannabis industry.

By instilling a risk culture starting with tone at top, the company can significantly reduce the potential risks of looping by utilizing the ACCCE Cannabis Risk Management Framework and implementing a risk-based approach. As with many other industries, commercial cannabis has its offenders that, undeterred, could cause significant loss of reputation to the commercial cannabis industry and brands through their actions.

Cannabis products continue to have a large demand on the illicit market, and it is the risk professional’s responsibility to guard against diversion. To prevent diversion, jurisdictions commonly have limits on the amount of cannabis a consumer is able to purchase in a single transaction. To get around the limit, a criminal or group of criminals may practice looping.

The Looping Example
Looping is the practice of evading the legal cannabis purchase limits by buying cannabis products at or below the legal limit repeatedly during a limited time period to obtain an illegal amount of cannabis product. The name comes quite literally from people going into the dispensary to purchase the maximum amount of cannabis, taking it to their car, and looping back around to the dispensary to repeat the process multiple times within the same day or even the same hour.

The looping case against a large Colorado commercial cannabis business was the first of its kind and included budtenders, managers, and owners who received hefty fines or jail sentences. The Denver Police Department was initially tipped off after a citizen noticed seeing several people making multiple trips each day to and from their parked vehicles to the store, continuing these loops for several hours at a time.

It is not always this straightforward to catch looping. Looping can involve a single consumer, multiple consumers working together, inside collusion, and multiple stores. To manage the risk of looping, risk officers need to implement risk-based controls to keep their consumer sales locations safe from looping schemes and tactics.

“It is not always this straightforward to catch looping. Looping can involve a single consumer, multiple consumers working together, inside collusion, and multiple stores. In order to manage the risk of looping, risk officers need to implement risk-based controls to keep their consumer sales locations safe from looping schemes and tactics.”

How to Reduce Looping Risk
The risk officer should help the commercial cannabis business owners or executives craft a policy to prevent diversion. It is important for the owners or executives to set the tone and establish the company’s intent to control diversion to enable the risk officer to effectively mitigate looping risks. The intention of the policy is to demonstrate to employees and vendors the commercial cannabis business’s reasonable efforts to control their points of diversion.

The risk officer should conduct a risk assessment that indicates the likely looping schemes to which the commercial cannabis business is exposed, or may be exposed. For example, a customer base that routinely buys near the legal limit may increase the chance that loopers are hiding in legitimate transactions. Similarly, in judging your geographic risk, being near a jurisdictional border may increase the likelihood that out-of-state loopers have access to a commercial cannabis business location. The risk assessment allows the risk officer to focus efforts on the most likely looping scenarios first and has the most effect on reducing overall looping risk.

Having identified the highest looping risks, the risk officer will then need to engage all staff to determine the control activities that will mitigate the inherent risks of looping identified in the risk assessment. Each commercial cannabis business will have a different looping risk profile, but there are standard controls across consumer sales that create a strong foundation. Creating a process for employees to raise looping concerns directly with the risk officer allows the commercial cannabis business to react quickly to poor controls or changes in their risk profile. Monitoring cannabis product transactions that are close to, or at the maximum purchase limit, throughout all locations is an effective means of identifying potential looping schemes.

To effectively manage looping risk, the risk officer should create reports that help management and the owners understand the effect of their work and present the results periodically. Standard reports should be created to assist management in understanding the scale and scope of looping risk. This should allow management to make appropriate risk-based decisions that consider this risk. For example, the level of looping risk at a commercial cannabis business may inform the extent of dual control expected at a store location.

A comprehensive risk program also includes risk-based training. Depending on the risk level of looping, the frequency of training may be more or less; however, it is common practice to have all consumer-facing employees trained to spot consumers exhibiting suspicious behaviors. Risk-based training should include how to spot red flags of looping with a focus on the looping schemes that were identified as highest risk in the risk assessment. Training should also include how to report suspicious activity to the risk officer.

Conclusion
Looping will always be a risk for commercial cannabis businesses. To make sure anti-looping mitigation remains effective and efficient over time, the risk officer should consider periodic assurance activities. Some common assurance activities include hiring a secret shopper to visit storefronts to test controls, monitoring the number of suspected or confirmed looping attempts over time for increases, or conducting periodic audit of controls. These activities will assist the risk officer in balancing the cost of mitigation with the risk the business faces.

An effective risk-based approach to control looping will reduce the chances that a commercial cannabis business will be targeted by organized criminals attempting to divert product to the illicit market. A legal commercial cannabis business found complicit in looping could cause a loss of reputation or even loss of the commercial cannabis license. Not every looper can be stopped, but implementing an effective cannabis risk management framework can reduce the likelihood that a commercial cannabis business is found complicit in looping activity.

 

This article highlights a significant vulnerability, faced by cannabis businesses every day. It brings attention to the threat not only being from external sources, but also from complicit or untrained employees, too.

So, can the “looping” tactic be totally stopped? Well, the answer is “No,” but by implementing simple measures and documented protocols into your Risk Management Framework (RMF), you can minimize your exposure.

 

Now then, what are the steps the cannabis business should take? Well, WJ Cousins and Associates recommends that a business first have a risk assessment conducted to identify any weaknesses in your current protocols and record keeping. Once any weaknesses have been identified, employees should be trained, and new protocols should be documented.

 

For assistance in this and many other concerns regarding a cannabis business, do not hesitate to contact us. We are here to assist you in protecting your business.

 

[ Article Credit: Brion Nazzaro, November 2, 2020 | Category: “Cannabis Risk Management Framework, Organized Crime.” The Association of Certified Commercial Cannabis Experts (ACCCE) is dedicated to advancing the professional knowledge and skills of those committed to commercial cannabis risk management. (Link to original article) ]

Cannabis Photo-Credit: Little Ivan

SECURITY ADVICE – CANNABIS

Failing to adequately plan, budge for security can have devastating consequences for market upstarts.

Author: Joel Griffin
June 24, 2021

All told, 36 states have passed laws permitting the use of medicinal marijuana and at least 18 have legalized recreational cannabis use thus far. While many see this as an opportunity to cash in on a fast-growing industry, the reality is that there are still significant barriers to entry for those that want to grow and sell cannabis.

With each passing year, the obstacles that once stood in the way of legal cannabis consumption – both medicinal and recreational – are falling by the wayside. This year alone, New York, New Mexico, and Connecticut have moved to legalize recreational cannabis use, while Alabama lawmakers recently approved legislation that will allow medical marijuana to be prescribed to patients suffering from a variety of illnesses and diseases.

All told, 36 states have passed laws permitting the use of medicinal marijuana and at least 18 have legalized recreational cannabis use thus far. This has led to a boom in both marijuana cultivation and dispensary operations throughout the nation, but while many see this as an opportunity to cash in on a fast-growing industry, the reality is that there are still significant barriers to entry for those that want to grow and sell cannabis, not the least of which includes a substantial investment in security.

According to Bill Cousins, founder of Michigan-based WJ Cousins & Associates, a security consulting firm that specializes in the protection of cannabis operations, business owners in the space must realize that their primary security responsibility is the safety of employees as well as their patients/customers, which means that they should build their security program around safeguarding human life within the facility or on the property in addition to protecting the product itself.

“Everything needs to be video recorded; any movements of individuals or cannabis should be recorded, according to the required state laws or regulations,” Cousins explains. “As I tell my clients, think casino. Anywhere you go you should be on camera and anywhere product goes it should be on camera.”

Of course, there is also a stark contrast between the security measures that are required at a cultivation facility where there are a set number of employees that have all undergone a background check versus a retail location in which anyone can walk off the street into the establishment.

“Everything still has to be recorded by a video surveillance system, but you don’t have the overall responsibility for patients or customers. Your cultivation facility is going to have the same requirements but a different degree of responsibility,” Cousins explains. “The cultivation facility may have only 10 employees whereas a provisioning center may end up processing 100 to 200 patients a day coming in and out from the street.”

And while security requirements may vary by state, Cousins says that the principles remain the same for the cannabis industry.

“Some states set standards of minimum requirements for the security cameras where other states don’t. In Michigan, they don’t set the standard, however; the cannabis facility is on notice that the state at any particular time – the marijuana regulatory agency or the state police – can access your cameras and monitor your activities within the facility,” he adds. “That would prohibit sort of your lower end cameras like you might buy at Home Depot or something like that, so it would require that they be professionally installed by an integrator.”

Seed-to-Sale Tracking
Cousins says it is also imperative that cannabis business operators go above and beyond when it comes to leveraging event tracking solutions for auditing purposes.

“In Michigan, for example, they use the Metric (regulatory cannabis event tracking software) system for following seed-to-sale of any cannabis products. Every state is going to require something similar, but Metric is a popular software system that is in use. I also strongly recommend a backup system, or what I like to call a ‘proprietary system.’ There are number of them out there… but you should have a dual audit system – one with Metric and one with your proprietary and the proprietary systems that are out there are very good and the majority of them will interface with Metric.”

In the event a dispensary receives a secure shipment of product, for example, if it is scanned into both systems and there is an outage or some other unforeseen event, then the business owner has an adequate backup system to provide corroborating data or even additional details to regulators during an inspection.

Pitfalls to Avoid
According to Cousins, one of the biggest missteps that those entering the cannabis industry make is failing to adequately plan for security.

“When you decide to get into the industry and apply for a license, you need to surround yourself with good people – people that are professional: a good attorney to write your application, a good security consultant to help you design your security plan,” he advises. “People think, well, ‘I can do this myself; I can write my own security plan.’ The problem with that is yeah, they might be able to put pen to paper, but if something occurs on the premises afterwards, you are liable.”

For instance, if there is an armed robbery at a dispensary, a patient or customer, whether they were physically injured or not, could file a lawsuit against the business over the fear that was inflicted during the incident.

“We’re in such a litigious society here in the U.S. that I’m going to make all kinds of allegations like, ‘I can’t sleep at night, I have headaches, I can’t go back to work, my relationship with my partner or spouse is damaged beyond repair because of this, I’m so traumatized by this incident.’ Well, if you write your own security plan, there’s going to be a lawsuit and how are you going to defend your security plan in a lawsuit? You’re not, you can’t because you don’t have the knowledge and the training to do it,” Cousins chides.

Another common error newcomers to the industry make, according to Cousins, is underbudgeting for the security services and technologies that will be needed to secure their facilities.

“At the beginning, I’ve seen a lot of clients come in and I ask them if they are funded for this project and they say, ‘Oh yeah, we’ve got plenty of cash.’ Then when it comes down to buying the equipment and getting the integrator, well money is tight at that point, so they have to go with a lesser quality camera system and, of course, they are all required to buy alarm systems and access control too,” Cousins adds. “People just aren’t budgeting for security. They consider it a necessary evil, but in fact they do get a significant return on their investment in the event something occurs.”


About the Author
:
Joel Griffin is the Editor of SecurityInfoWatch.com and a veteran security journalist. You can reach him at joel@securityinfowatch.com.

[ SecurityInfoWatch.com is the industry’s first responsive design website that is the gold standard in the security industry for providing breaking news, original content, product information, thought provoking technology analysis, webinars, e-newsletters and active discussion forum. ]

[ Click here to see the original article as well as to view more information on the Security Info Watch website. Image courtesy: Little Ivan/bigstockphoto.com. ]

Duty Of Care (Photo Credit - Nick_Youngson)

“Duty of Care” is an Essential Concept for Any Cannabis Business

As a new cannabis license holder, you have many items on your to-do list when it comes to setting up and launching your business. And while it is easy to be consumed by getting your enterprise up and running, there is one thing you want to be sure you HAVE NOT missed: securing your business against an adverse incident when it comes to security and safety. Just one such incident could put your business in jeopardy. This is what we would refer to as The Next Chapter of your business, or, now that you have it, to keep it!

It all goes to one legal concept: “Duty of Care.” According to the legal dictionary, “A duty of care is the legal responsibility of a person or organization to avoid any behaviors or omissions that could reasonably be foreseen to cause harm to others.” In other words, if you are not proactive with obtaining the proper documentation, it increases the chances that you are more likely to be a defendant in a civil suit.

Obviously, no business owner can foresee all possibilities, but you should exercise a reasonable effort to try and mitigate any potential problems. That is why WJ Cousins and Associates recommend having a well-documented set of security policies and procedures, training for your employees, and a Crisis Management Plan. Having these will certainly help with your “Duty of Care” responsibilities. These policies and procedures should address two areas.

 

First, are the daily operational procedures. Having this reference and requiring your employees to read and acknowledge understanding will pay dividends for business operations as well as help in the event of a discipline or human resource issue.

Second, all cannabis businesses should have a Crisis Management Plan, which will provide specific guidance to leadership and employees for such events as an armed robbery or medical emergency.

 

Another threat to your business can be failures to be compliant with regulatory requirements. Recently, the Marihuana Regulatory Agency conducted investigations (or inspections) into several facilities which resulted in significant fines to the business owners. These issues could have been avoided by having documented procedures that would have ensured all security technology and procedures are functioning as required by regulations.

 

Having an experienced security partner at your side who has a specialization in the cannabis industry can help you make your new business venture a success and avoid the security pitfalls that can jeopardize your investment.

For more information about security policies, procedures, and crisis management plans, e-mail us or just call us at 248-783-7190.

Remember, you need to protect your investment!

[ Photo credit: Nick Youngson ]

Hostile Termination

Much has been written about how to handle the termination of an employee. One thing to always remember is, even when the employee is viewed as easygoing and mild-mannered, that same employee can turn to violent behavior. The question becomes, what can you do to help ensure that it does not turn into a hostile termination and a violent situation? The answer is preparation and prevention.

But before we discuss preparation and prevention, you must remember when terminating an employee, for whatever reason, you are taking away their ability to make a living. In some cases, you may be adversely affecting their ability to get another position in the future. This is a stress factor for the employee, which can be compared to the same stress level a person feels when a close loved one dies or a divorce occurs. Because of this, you will need to use all your professional and people skills to correctly handle the meeting. If the situation goes badly, it will reflect on you, not only by your management but also by the other employees in the company. We all know when situations go bad, the “word” travels fast throughout the company. Therefore, the preparation should begin the moment it is determined the employee has to be terminated.

 

Recommendation #1: Once the decision is made to terminate an employee, obtain any and all information you can about the employee and what is going on with them outside of the workplace. If you haven’t done so already, work with the employee’s immediate management to determine such things as, does the employee possess guns? What kind of mental or emotional stress might the employee be under outside of work (such as divorce, death, addictions, or financial issues)? All these factors can be used to gather information which you can use to your advantage. Remember, the employee may or may not have any idea the termination is about to occur.

If you have obtained information that indicates the employee is prone to violence, or is known to carry a weapon, have plainclothes security professionals near the meeting room. These professionals should have training in de-escalating potentially violent situations. If your company does not have trained security professionals, contact a reputable security or risk management company for assistance.

Also, if you have a positive relationship with the local police, give them a call for advice on the termination and inform them it has the potential to get violent. By doing this, you are giving them advance notice so they can be better prepared to respond.

Recommendation #2: Where should the termination occur? Depending on the circumstances, it may be prudent to conduct the termination process at a neutral or off-site location, such as a lawyer’s office. If the meeting must be conducted on company property, do it away from other employees, such as in an unused conference room in the human resources department. Make sure it is a location where you will be out of the sight of other employees.

Recommendation #3: When should it be conducted? There are different schools of thought on this. Some would say it is best to do it on a Friday or just before a three-day weekend. This is not a good idea because as noted above, this can be a life-changing event for the employee. The employee will most likely need emotional or legal assistance. If the termination is done just before a weekend, it will be difficult for them to obtain the emotional or legal counseling they may need. Instead, they may turn to alcohol or drug abuse, which only makes matters far worse for everyone involved. Therefore, it is recommended to have the termination on a Tuesday or Wednesday and in the early to midafternoon. This way when the employee is escorted off the premises, they have the opportunity to seek the help they may need.

Recommendation #4: Remember, the purpose of the meeting is to advise the employee of the termination, not to debate or give advice. Keep it brief, direct and to the point. If the employee wants to argue, advise them of their options, such as union representation or consulting with a labor lawyer. Depending on the individual and the situation, this entire process should take no more than ten to fifteen minutes.

Recommendation #5: You will need a reputable witness. It is best to have another HR professional or senior manager present. During the termination process, the witness should be seated in a position near the door. By sitting there, the witness can leave the room to get help if the situation appears to become potentially violent. Also, position yourself where you can walk out of the room without getting stuck between the door and the employee. This gives you the tactical advantage to get out of the room if the situation is unresolved or becomes “ugly.”
If the situation becomes tenuous, tell the employee you must leave because you have another appointment, and exit the room as quickly as possible. Then call security for assistance.

Recommendation #6: Be prepared to escort the employee off the premises. Never do it alone! It is preferred to escort the employee with security personnel in plain clothes. If this is not possible, make sure you are accompanied by another management-level person. The other manager should walk behind you and the employee so as not to attract too much attention. This will allow them to act as a witness and call for assistance should the situation become tenuous or violent.

Recommendation #7: There are several options regarding what to do with the employee’s belongings. One is while the termination process is ongoing, a person from management can go to the employee’s office, cubicle or locker to gather up any articles of personal nature, such as family pictures and memorabilia. These items should be placed in a cardboard box and can be given to the employee as they exit the premises. The fired employee should be told that an inventory of their work area will be conducted and any additional personal items found will be forwarded to them at a later date.

Another option is to wait until the termination is over before doing a thorough inventory of the work area. After collecting inventory, all the personal items of the fired employee can be boxed up, and the box(es) can then be delivered to the employee by security or sent via mail.

Recommendation #8: Prepare yourself for the interview. In your own mind, you should be rehearsing possible scenarios that could occur. Not only potential violence, but what if the employee has an emotional breakdown or demands to see your superior or just tunes you out and sits and stares. What are you going to say or do? Be prepared to handle almost any scenario imaginable. It is always a good idea to consult with your legal department to know what to say and what not to say to the employee.

Recommendation #9: Have any and all documents related to the termination in either an envelope or folder. If a severance package is being offered, make sure the paperwork will be easily understood by the employee, especially if the package is offering a financial incentive or extended benefits. Go over all the paperwork and provide an explanation for each document. Due to the emotional stress of the situation, the employee will probably not grasp everything you are saying. To assist with this, the paperwork should contain a phone number that the employee can call if they have any questions or concerns.

Recommendation #10: Remember to always be professional and display a positive attitude during the process. This may assist in alleviating some of the stress from the employee. At the time of the termination, it may be difficult to remember this, but the employee is a human being. Treat and address them with respect. This may help diffuse a potentially bad situation before it even starts. It will surely be important if there is any subsequent litigation.

 

These are some brief recommendations that will assist you in the event of a potentially hostile termination of an employee. For more information about any general security questions you may have, or specifically securing your cannabis enterprise, visit our website, contact us, or call us at 248-783-7190.

Security Lessons for Cannabis Companies-ASIS Seminar

Recently we attended an American Society for Industrial Security seminar entitled, “Guarding the New Green: Security Lessons for Cannabis Companies in Emerging Markets.” It was both informative and well done.

The presenter, Glenn Hardy, CPP, is the Chief Growth Officer for Xiphos Corporation and Xiphos Security. First let us say, kudos to Glenn since even though his presentation offered security lessons primarily for the northern California area, we believe his lessons may be indicative of future criminal activity aimed at cannabis facilities around the country.

 

Expert Observations on Cannabis Facility Security

Some of the key takeaways were:

  • Cannabis facilities in northern California have been experiencing crimes such as breaking and entering where the perpetrators are equipped with military-style weapons.
  • Cannabis facility surveillance cameras are detecting an increase of suspicious activities involving loitering, a method used by criminals to conduct active/passive surveillance.
  • Criminal groups use multiple members to conduct surveillance to best determine ways to access a facility as well as the best ways to exit or flee properties after a crime.
  • Cannabis facilities and their employees are experiencing an increase in assaults, which have occurred at various times of the day, and not just at night.
  • Perpetrators are using heavy cutting tools to cut through fences and metal walls.
  • When breaching or surveillance tactics prove successful, criminal groups are using the tactics at other locations.
  • The number of “brute force” incidents is on the rise.
  • Cannabis facilities are now replacing bollards with the “Jersey Barricade,” which is used for worker safety during highway construction projects.

 

Security Solutions for Cannabis Facilities

There are some ways that you can combat these types of perpetrators and criminal activities. It won’t be easy, but the following are a few good suggestions.

  • Technical security measures, such as surveillance cameras, need to be maintained with software updates. If necessary, add more cameras and make sure that there is 24/7 monitoring.
  • Cannabis security managers need to work together and share intelligence information.
  • Just as important, information regarding criminal activity needs to be shared with law enforcement.

 

One of the most critical components necessary to secure a cannabis facility and its employees is what is known as “operational security,” also called OPSEC. With OPSEC owners have a process that focuses on reducing or eliminating a criminal organization’s ability to obtain information about the vulnerabilities of a facility or employees.

A successful OPSEC program involves both internal and external facets along with training. When properly put in place, the program can significantly reduce the chance of your facility or employees being targeted.

 

For more information about security lessons and securing your cannabis enterprise, visit our website, contact us, or call us at 248-783-7190.

Corp! Magazine - Most Valuable Entrepreneur - 2021 MVP Award Winner

WJ Cousins and Associates founder Bill Cousins was named an MVP Award winner by Corp! Magazine.

 

Early in 2021, our founder Bill Cousins was honored as an MVP Award winner by Corp! Magazine (“Most Valuable Entrepreneur”) as a part of its ongoing look at business leaders “Who Make Michigan the Best Place to Live and Work.”

As one of 70 honorees, Bill was recognized for his career, his community involvement, and his commitment to making Michigan a great place to live and work, creating job opportunities, driving economic growth, and nurturing community advancements while also being the leader of a successful company.

The award celebrates the professionals, entrepreneurs, and millennials who are moving Michigan forward, and is another great recognition for the work that Bill does in the community, in law enforcement, and in leading his business, WJ Cousins and Associates.

 

To find out more about how WJ Cousins and Associates can be of service, or to contact Bill Cousins directly, fill out our Contact Us form, and be as specific as you can.

 

[ FYI: Click here for the entire listing of the Corp! MVP award winners for 2021 ]

Medical Marijuana Lawyer

Finding the right medical marijuana lawyer to represent your cannabis dispensary can be a timely task. You must find a lawyer who is both a good business lawyer and the right lawyer for you. When considering your cannabis lawyer, consult the following five criteria for a profitable match.

1. Is the lawyer nationwide? Unless money isn’t a factor or you are a large established corporation, avoid nationwide firms operating with 100+ attorneys. Large nationwide companies often have minimum fee requirements and hourly billing requirements for their appointed attorneys. There is no need to pay nationwide fees when you are establishing your business in one territory. If you know you will span over two states, retain a law firm that covers both of those states.

2. Avoid solo practitioners and micro-firms. When hiring a law firm to provide your legal advice, it is unlikely that a small firm can sufficiently cover and address all the topics required to represent your cannabis business. Evaluate the law firm’s knowledge on the following topics:

Corporate law
Contract law
Intellectual property law
State licensing and local zoning issues
Government relations
Administrative and employment law
Litigation
Insurance

Additionally, avoid law firms that only do cannabis law. A firm specializing in a practice that is still being introduced to the market does not have the necessary information needed to help your business. The law firm you choose should have experience representing companies in other business endeavors, so they will be able to support your company in all its needs.

3. Lobbyists and criminal defense lawyers are not ideal for your cannabis business. If cannabis is legal in your state and you are searching for a firm to represent your business in civil matters, criminal defense or lobbyist will not benefit you. Your company needs lawyers who above all else know business law.

4. What are the credentials of the lawyers at the firm? You need to know who will be representing you and the skills they possess. As you review the credentials, pay attention to the following areas:

Did they go to the top-tier law schools?
Does the firm have a variety of lawyers from different colleges, or different states?
Have the lawyers spoken before other lawyers?
Do they speak or write about legal issues relating to new cannabis businesses?
Are there rankings of the law firm on any review sites? (While these sites are opinionated, this gives you an indicator of the firm’s reputation among the legal community.)

5. Make sure you like your lawyer. It is often that people do not “like” lawyers, they have reputations to be cutthroat and cold. But the lawyer you choose for your business must be a good fit for you. This means that while evaluating the firm, choose one that you are comfortable communicating with and feel that they will give you the resources and services you need. Their views on the cannabis business should be the same as yours. Attorney-client relationships are built on capability and trust, and this is essential while merging into the new industry of legalized marijuana.

 

WJ Cousins and Associates has achieved all five of the above criteria and can represent your cannabis dispensary steadfastly as your medical marijuana lawyer. Contact us to discuss your needs.

The Price of Business

WJ Cousins and Associates founder Bill Cousins was interviewed by The Price of Business Radio—a nationally syndicated show out of Houston—about security issues in the medical marijuana industry.

Kevin Price: Welcome back to this, already, the final segment of today’s Price of Business. Really glad to spend some time with Bill Cousins. And he’s going to give us some insight about security issues in the incredibly expanding marijuana industry. I don’t care what your position is on marijuana. I personally have long been an advocate for medical marijuana and certainly have seen miraculous results when it comes to that. But this is an industry that here to stay. There’s no question about it. Even now, President Trump is giving rumblings of possibly supporting legislation to decriminalize it on a federal level. And states have already taken the lead making it legal.

So to me, it’s just a question of when. And so, security issues about this to me seem to be a timely question to ask. Bill Cousins is our guest. His business is WJ Cousins Associates. And that website is wjcousinsassociates.com. Bill, welcome to the program. Now, you weren’t always in the marijuana space, but you’ve long term been in the consulting and security space. A little bit about your background before we get into our topic.

Bill Cousins: Thank you. I’ve been in this business about 34 years. I started back in the mid-70’s as a local police officer in Michigan’s suburban city of Detroit. And then I went on to have a great career of 22 years with the United States Secret Service, where I retired as one of the assistant special agents in charge of the Detroit office. And then I moved into private industry. And I was director of security for two major manufacturing corporations, international corporations. And then about five years ago, I decided to go out on my own and open my own shop, so to say.

Kevin Price: So you say suburban Detroit, where specifically?

Bill Cousins: Livonia, Michigan.

Kevin Price: Livonia. I grew up– I was born in Ferndale.

Bill Cousins: Oh my gosh. Not far away at all.

Kevin Price: Oh no. A lot of my friends ended up settling in Livonia. I love Michigan. In fact, I’m going up there soon. I’m going to be up there for a couple of weeks. And you can take your guy out of Michigan, but not Michigan out of the guy. So that’s great. And I always love talking to people from the area. But you weren’t always in the medical marijuana security space. Are you exclusively in that space now, or is that just one of the areas that you’re focusing on?

Bill Cousins: That’s just one of the areas that I’m focusing on. About a year ago, just before the law here went official and the state started accepting applications and so forth, I saw a void in that area to provide, which is required by the state, the security plans for the medical marijuana establishments. With that, I just took my years of experience in securing all kinds of facilities all over the globe in the Secret Service, and I just adapted it to the regulations here for this state and to just give them a plan that gets them through the state licensing program.

Kevin Price: Oh, I see. So you help navigate them through that process. And obviously, it’s probably a certain degree of boilerplate, but there’s probably also some things that are unique to each business, I would assume.

Bill Cousins: Exactly. Each facility, each site is unique, whether it’s an old facility or an old building that’s being remodeled and converted, or it could be a new site just with architectural designs. So they’re all different.

Kevin Price: So tell me, what’s unique about security needs for medical marijuana versus other things that you have provided security for?

Bill Cousins: Well, first of all, we all know medical marijuana facilities provide a tempting target to the criminal element, whether it’s individuals or organized crime groups. And the reason for that is, number one, you have a lot of cash on site. And number two, the medical marijuana that’s in the facilities has an immediate street value. So if they take it, they can get rid of it on the street very rapidly.

Kevin Price: And so as a result, are you having to have to do some things for it that you wouldn’t even do for other businesses? And if so, what would that look like?

Bill Cousins: What I’ve done, Kevin, is taken the Secret Service model of 360-degree coverage. So we cover, not just the building itself, but we go into the geographic environment where the building is in, the guarding of the outer, middle, and inner parameters. We help them with selecting employees and how to do background checks, the technology that’s going to be used– the security technology– auditing and tracking, technology, policies, procedures, how to handle visitors, even go through how to open and close the business to protect the employees and the patients that might be in there.

Kevin Price: I guess you don’t want just anyone opening or closing. You probably always want a certain number of people always there for accountability sake. There’s probably a lot of unique things that pertain directly to that industry.

Bill Cousins: I try to tell my clients basically failing to plan is planning to fail. So if we can create the plan, and they follow the plan, it will help them be successful.

Kevin Price: Talking to Bill Cousins. His website– I want to encourage you to get that– one more time is WJ Cousins–I’m sorry–That’s WJCousinsandAssociates.com. So much for my reading abilities. We got about a minute left, a little less than that. But I’d love to get your final thoughts as we wrap up the segment, Bill. And thanks for being with us.

Bill Cousins: It’s my pleasure. And thank you for having me. As you said at the beginning of the interview, this industry is exploding. It’s estimated to hit well over $2.2 billion in sales this year alone in 2018. So we have an opportunity now to legitimize it, use it as a healing measure for the patients, and just legitimize the whole marijuana industry.

Kevin Price: And let me tell you, folks. The miracle stories surrounding marijuana are extraordinary. And if anything else can be abused, everything else can be abused. Unlike tobacco, we can find all kinds of positives that come from marijuana if in the right hands used in the right way. And frankly, to a certain extent, the more we embrace it, the more we can help those who have addiction issues that surround it. So Bill, thanks so much for your time. We’ve got to wrap up this segment with that. And I want to remind you though as we wrap up the show in fact, that the show continues 24/7 at priceofbusiness.com, where we’re continuously adding new content– audio, visuals, articles, and more. We like to say it’s the show that never ends because it continues 24/7 at priceofbusiness.com. All right. While there, engage with us on social media. And remember, The Price of Business is nationally syndicated on the BizTalk Radio Network.

 

For more information about WJ Cousins and Associates, or to contact Bill Cousins directly, use the Contact Us form and be as specific as you can.

Stay alert

The world is going through an unprecedented experience. One that the last few generations have never experienced, and hopefully future generations will never have to endure. Around the nation, events have been canceled, schools and businesses are closed, stores are struggling to keep basic necessities on their shelves, and families are being advised to “self-isolate.” That’s crisis-speak for “Please stay indoors away from other people.”

The uncertain nature of this crisis has caused people to become hyper-focused. They are moving into self-preservation mode. People are so focused on getting what they need that they are moving at a fast pace. They are throwing caution to the wind. Everyone is speed walking or driving too fast just to get to their intended destination and back home as quickly as possible.

When you move at this pace, you develop tunnel vision. You do not see what or who is around you. People who are in this mode lose a basic fundamental of safety and security: situational awareness. The individual is not aware of what is occurring around them. The individual becomes unaware of their surroundings, whether it is a car backing up in a parking lot or whether they are about to become the victim of a robbery.

A prime example of this happened to my wife a few days ago. She drove to the local grocery store and pulled into a parking spot. On her right side was a cart corral and on her left side was another empty parking spot. As most of us usually do, she checked her left side mirror as she stopped the car and turned the engine off. It was all clear. As she opened the car door, another vehicle whipped into the empty spot and struck our car door. The impact shoved our vehicle into the cart corral on the right side and knocked my wife off her seat in the car!

When the other driver was asked why he was driving so fast, he stated he was in a hurry to get back into the grocery store because he had left his cell phone in there. This is a prime example of not slowing down and getting tunnel vision. Just a second or two later and he would have killed my wife.

This is the time for everyone to slow down, take a deep breath, and become aware of their surroundings. As times get tougher and as the stress of this pandemic starts weighing on all of us, people will only become more desperate. Jobs are being lost which adds even more stress. Some people might do things that they would not even consider doing under normal circumstances.

At WJ Cousins and Associates, one of our specialties is personal security and safety training. Along with the advice to slow down and look around, here are some additional pointers.

  • Going to the ATM? Don’t go alone. Take someone with you. As you are withdrawing the money, have someone stand by you and make observations, such as is anyone watching you? Does another individual all of a sudden approach the ATM machine behind you? Are they watching your withdrawal? Having an observer with a mobile phone handy provides another layer of security and acts as a deterrent.
  • Going to the store? Only carry the necessary amount of cash needed to complete your transaction. Criminals will use this time of uncertainty to their advantage. They know you are in a rush, not focusing on your surroundings, so you become a perfect target for a pickpocket or robbery.
  • Stop and look through the window before you walk into a fast-food store or gas station. Are people moving around naturally? Is the business being conducted as usual? If not, do not go in. Back off and call the police.
  • At night, only park or walk-in areas with adequate lighting. Never park way out in the parking lot by yourself in the dark.
  • When walking, keep your head up and look around. At all times, be aware of your surroundings!

These are just a few pointers to help you get through this difficult time. We can all get through this safely by just slowing down and practicing situational awareness.

WJ Cousins and Associates conducts travel and personal safety seminars for corporations, organizations and individuals.

If you have any questions or would like further information, please do not hesitate to contact me at bill@wjcassociates.com.

Stay safe, healthy and aware of your personal surroundings.

 

 

Leamington, Ontario, was once the major production hub for Heinz brands and had over 85-million square feet of greenhouses surrounding the town. In 2014, Heinz cut back production and caused serious concerns for the 28,000 residents of the small town on the north shore of Lake Erie. Canada legalized recreational marijuana nationwide in 2018. It was a major boon to Leamington. A company named Aphiria moved into town, took over 1.1 million square feet of greenhouses, and now produces nearly 250,000 pounds of high-grade marijuana annually. At current market prices for marijuana buds, that translates to more than $1.5 billion in gross revenues. Aphiria stock is currently trading on the New York Stock Exchange between $5 and $6 per share with analysts predicting a 21% growth rate.

Post-industrial cities in Michigan like Detroit, Flint, and Saginaw were hoping that the legalization of recreational marijuana in this state would result in an economic boom like that experienced by our Canadian neighbors. An MLive article published this past August by Amy Biolchini, reported that Michigan is now one of the top three locations in North America for investors in publicly traded marijuana stocks. Michigan ranks third behind Maine and Massachusetts but is ahead of California and Alaska. The future looks very bright for the industry’s growth, but everybody is waiting for the Legislature to finalize retail sales provisions.

What seems to be holding up the lawmakers in Lansing is a clear understanding of the security requirements for cannabis facilities. Unlike Canada, Michigan is only one of 11 states in this country that has legalized the recreational use of cannabis. It is still an underground, criminal activity in some neighboring states. That means that cannabis-producing, processing, and distribution facilities require more than the average business security measures.

Another stumbling block is that cannabis is truly a cash crop. The federal government still considers Marijuana a Schedule 1 narcotic. Potrepreneurs still cannot deposit cash into an FDIC bank. Doing so would automatically trigger a Suspicious Activity Report (SAR); a document that financial institutions must file with the Financial Crimes Enforcement Network (FinCEN) following a suspected incident of money laundering or fraud. Banks don’t want that kind of scrutiny and investors are concerned about federal regulators and the problems of managing a cash-only enterprise.

The answer to the current dilemma seems to be that a comprehensive security plan must be developed that will safeguard producers, distributors, and investors. The state has established basic security standards requiring video cameras, alarms, and access controls; however, we don’t believe the requirements are detailed enough to guarantee the security of the facilities, the safety of those who work in this industry, or sufficiently protect the investors who are financing the business.

The state has given local law enforcement primary jurisdiction over facilities and local governments who have allowed cannabis facilities in their community have issued a list of security and aesthetic requirements that they would like to see implemented. For example, nobody wants to see a greenhouse facility surrounded by barbwire-topped chain-link fencing with guard towers and sweeping searchlights. We believe there are some simple solutions that will meet everyone’s needs.

It all begins with a comprehensive, customized security plan. Every plan would contain some common elements like:

  • A thorough crime analysis of the community.
  • Product storage vault requirements.
  • Security windows.
  • Intrusion alarms.
  • Access control.
  • Proper exterior lighting.
  • A 360-degree coverage philosophy.

A thorough crime analysis of the community would include a brief examination of crime statistics in the community, an analysis of local law enforcement agency capabilities, and an analysis of local fire/EMS response times. Most local police know the criminal demographics for their community and can identify any potential threats.

A storage vault for products should be of sufficient size to handle storage and possible packaging of products prior to shipping. Construction features should include reinforced walls, ceiling, and floor. Access control, lighting, interior, and exterior camera coverage, and climate-controlled HVAC systems should be on a secured power source with generator backup.

Security windows are tempered glass and polycarbonate layers with polyester film laminate designed to allow light transmission but be very difficult to break through to prevent unauthorized ingress. Vibration sensors can also be mounted to detect any attempt to tamper with the windows.

Access control is one area where forethought in the design can pay big dividends. A common design feature is the double-entry. For the grow facility, authorized personnel enters an exterior door using a key, a keypad-entered code, or a keycard that admits them into a vestibule with a second door. Entry through the second door into the interior of the facility is accomplished by a second access method which might be biometric, facial recognition, or having a security person admit the individual. There is also a panic button in the vestibule in case the authorized person is being coerced. For the distribution facility, the best practice is that customers are admitted to a lobby area where security personnel verifies their identity, and access to the retail area is controlled based upon the number of customers that can be personally served at a given time. Bollards at the entry allow pedestrian access but prevent the “smash and grab” events that occurred in the industry’s infancy. All points of entry should be limited, well-lit, and monitored by interior and exterior cameras.

Since most criminals prefer to work under cover of darkness, exterior lighting of the facility is a given; however, this is where security systems can be easily compromised. All entry points to the building should be lit as well as parking areas and loading docks. Exterior lighting fixtures should include cutoff capabilities that prevent light pollution beyond the property line and also prevent glare from compromising security cameras.

Developing a 360-degree security coverage philosophy means considering all the ways someone might try to gain unauthorized access to your facility and designing ways to counter those efforts. A well-designed growing facility can be made to look like an innocuous warehouse from the outside but be fortified to prevent unauthorized access using perimeter motion sensors, full-motion camera coverage, and access control systems. A distribution facility can look like an ordinary storefront but utilize security glass, limited access protocols, and obvious camera coverage to dissuade anyone from attempting the illicit activity.

It also means developing protocols for handling and transporting products and cash in a secure manner. It means having secure opening and closing procedures that protect employees and emergency protocols should something happen.  A 360-degree security coverage philosophy anticipates the requirements of the regulators, protects the interests of the investors, and allows for safe and profitable operation of your cannabis facility.

 

Bill Cousins is the founder and President of WJ Cousins and Associates LLC of Lake Orion, Michigan, a full-service firm specializing in Security Consulting, Private Investigation, and Litigation Consulting. Bill has partnered with the leading attorneys and technology integrators in the marijuana industry and is an Advisor to the LARA Working Group. He has more than 35 years in the security industry, including 22 years as a U.S. Secret Service agent and nine years as Director of Security at two major corporations.