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Amazon: Largest CBD Retailer or Just One Big Fraud?

Amazon has been a big retailer of CBD as early as 2014, maybe still today with over 9,000 products. Even in Australia I bought CBD from Denver via Amazon.com.au.

Yes, their Terms Of Service claims you can’t, but that’s more of a litigation/regulatory CYA. It keeps away the milquetoast sheep, they want brave lions as vendors. They even allow the “CBD” acronym for non-consumables.

Likely as a litigation and regulatory workaround, Amazon pioneered that unfortunate “hemp extract” labeling in 2015, which is an invitation to fraud. Many of the products no doubt are common hempseed oil not necessarily high in CBD. While some try to make that clear, most are marketed in a way to appear to contain at least some CBD, even using health claims impermissible to FDA (“Hemp Oil for Pain, Stress Relief, Mood Support, Healthy Sleep Patterns, Skin Care. 1,000 mg, 33 mg per Serving x 30 Servings” in a 30mL bottle).

Lack of overt disclosure is what protects Amazon and the seller from fraud claims. Their TOS is used to legally protect the company, it’s not a reflection of what is actually going on there. It’s merely a document they invoke whenever it is to their advantage, to any stakeholder whether vendors, customers, or regulators. But until then even health claims impermissible to FDA appear to be allowed, as this image of a Sponsored link for jellybeans at the top shows.

The fact is study after study show hempseed oil has long contained THC, thus 20 times more CBD. Yes, trace amounts, but trace amounts aren’t zero amounts. At the legal 0.3% max THC as little as one-quarter teaspoon can have a minimum pyschoactive dose of THC, and 6% CBD. People can in fact fail drug tests by consuming hempseed oil as high as 120 ppm THC, as was found in studies. While the Canadian standard is 10 ppm, the US standard is 3,000. This is how Amazon manages that regulatory risk. “Hemp Extract.” “Hemp Oil.”

For those who insist “selling CBD on Amazon is illegal,” I remind you that “legality” is determined by enforcement, not words on paper. Both Uber and AirBnB were originally “illegal” business models in their respective industries, that just kept the sheep away from those lions long enough to give them a head-start.

If I was a tort lawyer I would buy and test products from Amazon appearing to contain CBD, starting with the deepest pockets company. Hold them accountable: “hemp extract” is thought by the consumer to refer to actual CBD content even if it isn’t explicitly stated. The way they are using language is merely to have a defense in court, but in this new industry consumers have no choice but to trust that “1,000 mg hemp extract = 1,000 mg CBD.” Counselor, pierce that fraud. Even test common hempseed oil, it likely contains undisclosed THC.

While I’m a huge cheerleader for the hemp industry as well as CBD (I first wrote about CBD in 1998), I want to see “faux-thentic” and fraudulent products disappear more than anyone. I’ve pushed back at that for decades, even in soyfoods in the 80s.

But I’m also a CBD patient not blind to the reality of modern business practices. Coming from 40 years in the notorious perishable foods industry, and going to B-school at Sonoma State University, I know how businesspeople are.

Thus I’ve seen the kind of guys who would bottle common hempseed oil and sell it as CBD, and don’t trust them. Like the Ferengi MBA who killed the Sebastopol apple industry because the apple sauce and juice plant were worth slightly more to the bottom-line of the penny stock small cap public company as a rent-seeking warehouse owner on a high-value intersection than in actually just doing what was the long heritage of the town, foods from apples. Luther Burbank bred apples there, and the Gravenstein was prized for sauce, juice, leather, and other products.

One of my first jobs was cleaning that applesauce production equipment at night. They have a Gravenstein Apple Fair every year, that’s how much the apple industry was part of the culture of the town of “Sebast-apple.” But MBAs gotta MBA, so only after the farmers spent money on an annual spray did they announced the change. The town went into shock. Later, public company Sonoma West Holdings (SWHI on the OTC) was taken private by an insider at $10.05 per share in 2011, and recently bought a military technology company, cuz MBAs gotta MBA.

People are now entering the Cannabis, CBD and Hemp industry from other industries which celebrate conniving duplicity, lies, and fraud. No doubt some are selling hempseed oil at inflated prices on Amazon. The question is… which ones? Not even certification schemes are credible anymore. The opportunity for authentic marketers to differentiate by quality and CBD content is huge.

And Amazon, with your power in the marketplace you have choices: drive improvements in consumer safety and protection, or kow-tow to unelected bureaucrats at FDA unconstitutionally making new law. Which will it be?

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