State cannabis regulators have taken strong enforcement action against Omnium Health Inc., a Long Island-based licensed cannabis processor and distributor, for allegedly enabling unlicensed operators to funnel illicit products into New York’s legal cannabis market.
According to the New York Office of Cannabis Management (OCM), Omnium risks heavy financial penalties and the possible revocation of its license after investigators discovered what they described as “an unearned backdoor” that allowed untested cannabis products to reach licensed retailers. The agency said the alleged scheme undermines the integrity of New York’s regulated market, valued at nearly $1.8 billion.
“These actions ensure that regulated businesses do not exploit loopholes or take advantage to undermine legal operators who play by the rules,” said Felicia A. B. Reid, OCM’s acting executive director, in a statement.
The investigation, led by OCM’s Trade Practices Bureau, began in February 2025. Regulators allege that Omnium allowed unlicensed third parties to use its licensed facilities in exchange for rent, effectively laundering illicit cannabis products—including THC isolates—into the state’s supply chain. Officials confirmed there was no evidence these products were produced within New York’s regulated system.
In April, regulators quarantined $10 million worth of vaporizers, pre-rolls, and other cannabis products connected to Omnium, sold under brands such as Stiiizy and mfused. The company could now face multiple sanctions, including:
- Revocation of its processor and distributor permits.
- Permanent debarment from applying for future licenses.
- A fine tied to the projected revenue generated from the illegal activity.
- A potential statewide product recall of all unlicensed or improperly processed items.
Industry leaders have welcomed the OCM’s crackdown, calling it a step toward fairness and consumer safety. “Today’s enforcement actions reinforce a simple truth — consumer safety and market fairness must always come before profit,” said Joe Rossi, spokesperson for the Green Standard Alliance, an advocacy group that recently published a report on the dangers of untested cannabis products.
The OCM’s actions against Omnium follow earlier disciplinary measures in September against Lexachrom Labs, another Long Island-based company accused of falsifying cannabis test results. That case led to multiple product recalls after regulators found that test results were fabricated rather than conducted properly.
The outcome of Omnium’s case could mark one of the toughest enforcement decisions yet in New York’s legal cannabis industry — signaling that regulators intend to send a strong message to licensed operators about compliance and integrity within the market.