TORONTO – The Ontario Cannabis Store says a cyber attack by one of its logistics partners has left the provincial pot distributor unable to process or deliver orders to marijuana stores and customers.
OCS said Monday afternoon that there was no indication that its systems were targeted or customer information compromised during the Aug. 5 attack on the third-party distribution center’s parent company, Domain Logistics.
“However, out of an abundance of caution to protect OCS and its customers, the decision has been made to cease operations at Domain Logistics until a full forensic investigation is completed,” OCS said in a statement.
Domain Logistics did not immediately respond to a request for comment, but OCS said it is working closely with the company and third-party cybersecurity experts to conduct an investigation, which is ongoing and expected to be completed within the next few days.
The breach is set to affect customers shopping for pot on the OCS website — the only legal online seller of recreational cannabis in Ontario — and about 1,333 licensed cannabis stores, which have no choice but to buy the products they sell from OCS supported by the government.
An OCS letter to retailers obtained by The Canadian Press said the launch of any new products planned for this week would be “delayed until further notice.”
“As a goodwill gesture,” OCS will also waive all retail delivery fees until September 30 and a $500 handling fee for one emergency order per store between September 1 and March 31, 2023.
OCS and Domain Logistics have not said how soon deliveries will resume, but have promised to provide updates on the matter as they become available.
The incident follows an OCS announcement on May 11 that the Ontario Provincial Police was investigating the “misuse” of confidential store sales data.
That breach “was not a failure of security or IT systems,” OCS said, after quickly launching an investigation to identify the source, restricting access to internal data reports and notifying police.
Both breaches come amid increased competition in Ontario’s cannabis industry, which has seen the number of pot shops soar in recent months.
Many predict store closures are imminent because demand for cannabis has not grown at the same rate as store openings, the illicit market remains strong, and stores are constantly having to squeeze their margins as competitors steadily lower prices.
This report by The Canadian Press was first published on August 8, 2022.
