David George-Cosh

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The chief executive officer of CannTrust Holdings Inc. (TRST.TO) broke his silence briefly on Friday after the Canadian cannabis producer was caught in a compliance controversy when employees allegedly built fake walls to hide illegally grown pot from federal regulators.

CannTrust CEO Peter Aceto, who has not commented publicly on the company’s non-compliance audit from Health Canada since Wednesday, responded to a user on Instagram who criticized the executive for not being transparent with investors and asking how long he could hide the illegally grown pot for.

“21 years a trusted banker of the people & 9 years the CEO. Then 9 months later a thief/fraud? Ah, doesn’t make sense. Let the dust settle,” Aceto replied.

Although Aceto’s Instragram account is unverified, a CannTrust spokesperson confirmed that the account belongs to the company’s CEO.

Shortly after BNN Bloomberg inquired about Aceto’s comment to verify it was indeed written by him, the account became private and could not be  viewed publicly.

“To protect the privacy of Peter’s family, his personal Instagram account was made private following media inquiries regarding the posts on his personal account,” a CannTrust spokesperson told BNN Bloomberg in an emailed statement.

CannTrust’s shares have been cut nearly in half since Monday after the company disclosed it ran afoul of Health Canada rules by growing cannabis in unlicensed rooms at its Pelham, Ont. facility between October 2018 and last March. As a result, Health Canada placed a hold on 5,200 kilograms of dried cannabis from the site, and CannTrust voluntarily placed a hold on an additional 7,500 kilograms of inventory that was produced in the unlicensed rooms.

On Thursday evening, CannTrust said it would halt sales of all its cannabis products "as a precaution" while Health Canada reviews the company's facility in Vaughan. The company also said its board of directors established a special independent committee to investigate Health Canada’s probe and stated it's too early to determine the impact on its financial results.

Wojtek Dabrowski, managing partner of Provident Communications Inc., a strategic communications firm based in Toronto, said that a CEO currently embroiled in a significant crisis shouldn’t be spending time engaging users on Instagram, and warned it could be troublesome from a disclosure perspective.

“By suggesting that people should ‘let the dust settle,’ he could be seen as implying that the potential pending regulatory actions against CannTrust won’t amount to much in the end. Instagram isn’t the place for this sort of statement from the CEO of a public company,” Dabrowski said in an email to BNN Bloomberg.

Cannabis Canada is BNN Bloomberg’s in-depth series exploring the stunning formation of the entirely new – and controversial – Canadian recreational marijuana industry. Read more from the special series here and subscribe to our Cannabis Canada newsletter to have the latest marijuana news delivered directly to your inbox every day.