361 Arrests & $26M: Glass House Drama

Immigration enforcement raids at two Central Coast cannabis farms resulted in $26 million in lost revenue, with a 100,000 pound reduction in harvested and dried cannabis, Glass House Farms reported on Nov. 12.

"In light of the events of this past summer we made the hard decision to completely revamp hiring and staffing practices for both employees and third-party labor contractors," Glass House's CEO Kyle Kazan said in a press release. "As anticipated, these actions resulted in temporary worker shortages as well as a planned scaled back in new planting and production."

On July 10, federal agents served criminal search warrants at Glass House grow sites in Carpinteria and Camarillo, which led to the arrest of 361 illegal immigrants including convicted rapists, burglars and child molesters. During the raids, at least 14 migrant children were "rescued from potential exploitation, forced labor, and human trafficking," according to the U.S. Department of Homeland Security.

Cannabis businesses in California are strictly regulated, including requirements that workers undergo criminal background checks. Convicted criminals and juveniles are not permitted to work in the cannabis industry.

A federal investigation into immigration and potential child labor violations by Glass House is ongoing. At this time, there have been no charges filed against Glass House or its executives.

Glass House stock was trading at $5.94 a share before the raid, which fell to $4.82 afterwards. Amid positive reports, the stock surged to $9.40 on Oct. 15.

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