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Sacramento Cannabis Testing Lab Surrenders License After Director Fakes Results

By Alexander Beadle

Published: Dec 29, 2018   
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Sequoia Analytical Labs, a cannabis testing facility based in Sacramento, California, has surrendered its state cannabis testing license on its own volition following the discovery of internal test result fraud.

At present, there has been no formal statement or press release from the California Bureau of Cannabis Control (BCC) regarding the surrendered license, nor was the situation mentioned in the BCC’s weekly licensing report, but Sequoia Analytical Labs has released a statement on the matter in a post on the lab’s Instagram page. The page has since been made private, but the statement is now available to read in full on the lab’s website homepage.

Fraud discovered during surprise inspection

Suspicion was raised within the BCC when they noted abnormal formatting in some of Sequoia’s test reports. In response, BCC officials conducted a surprise inspection of the Sequoia laboratory. According to Stephen Dutra, the general manager of Sequoia, in a statement made to Leafly.com, the lab manager Marc Foster immediately confessed to falsifying data when being questioned by BCC officials about the unusual test reports: “He flat-out told them, ‘I faked it.’”

The fraud was allegedly motivated by faulty testing equipment, with Foster also reportedly telling Dutra “I just kept thinking I was going to figure it out the next day,” after the fraud was discovered.

The statement from Sequoia Labs reports that out of the 66 pesticide tests the lab performs, 22 had their results affected by Foster’s actions. The statement also reveals that the lab director had been discretely falsifying results for nearly five months, beginning on July 1 — the date that the state of California made testing for these 66 pesticides mandatory for cannabis products being sold in the state. It has been estimated that around 700 samples may have passed through the facility during this time without being fully tested.

Despite this, Dutra has provided assurances that any risk to consumers is slim. Of the 22 pesticides affected by the falsified test results, the majority were Category II pesticides which present the least risk of harm. Dutra also stated that on average only 3% of product ever fails the pesticide tests, so numerically, that makes it unlikely that there is any risk to consumers. Additionally, due to the speed at which the cannabis product distribution process progresses following testing, it is highly likely that if there were to be any unusual incidents as a result of the improper testing, such incidents would have already happened. At present, it appears there have been no incidents linked to material that moved through Sequoia Labs during this timeframe.

In the Sequoia Labs statement, it was revealed that Marc Foster was fired the following day after the fraud was discovered, with management and ownership “horrified to learn about this severe breach of a very important safety regulation”. Since Foster’s termination, Sequoia has reportedly hired a highly qualified replacement to take over the lab and revamp their testing equipment and procedures.

Concerns over industry bottleneck?

Both geographically and in terms of population, California is a giant of a state; it ranks 3rd in the United States in terms of size by area, and is the most populous state by a margin of over 10 million people. The state is also home to one of the biggest legal cannabis markets in the world. Despite its size and influence, the state is served by a mere 44 cannabis testing labs, distributed across the state. Sacramento is home to only 4 of these labs, including Sequoia.

There are fears that if the lab is not able to successfully regain its license when it re-applies at the end of the month, testing facilities in the Sacramento area may not be able to meet demand. Even with the comparatively short current closure of the lab, beginning on November 28, cracks in the normal workflow are beginning to show. Speaking to The Fix, Sacramento’s head of cannabis policy and enforcement, Joe Devlin, reports that “the shortage of labs has really created a bottleneck in the supply chain across the state.”

Sequoia is optimistic that they will be approved to hold a new license following their re-application, and will be able to restart operations in the new year. Before the fraud was uncovered, the lab maintained a good reputation within the industry for reliability and quality, having served the medicinal cannabis market in the years prior to the legalization of recreational cannabis use in California. Additionally, their honesty and transparency in handling this incident should be looked on favorably by the BCC.

Dutra has said that the team at Sequoia “want to be as transparent about this as possible” and have been rapid to act on any recommendations they have received from the BCC. The lab has already notified all suppliers, and chose to make their statement acknowledging the fraudulent test results available both on its website and on social media. The lab is also making changes to its organizational workflow, putting proper verification checks in place as a way to ensure that similar incidents cannot happen again.

Alexander Beadle

Science Writer

Alexander Beadle has been working as a freelance science writer since 2017 and has covered the cannabis industry for Analytical Cannabis since 2018. He has also written for our sister publication, Technology Networks, and the cannabis industry consultant firm Prohibition Partners, among others. Alexander holds a Master's in Materials Chemistry from the University of St. Andrews, where he won a Chemistry Purdie scholarship, and conducted research into zeolite crystal growth mechanisms and the action of single-molecule transistors.


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