Vermont hemp growers burned by buyer?

Published: Dec. 12, 2019 at 5:32 PM EST
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Nearly a dozen Vermont farmers are worried about their financial futures after investing time and money into hemp. Some switched their entire farming operations to grow it and say they were stiffed by the man who was supposed to buy it. Our Darren Perron investigates.

Patrick Sullivan expanded his Montpelier chicken and vegetable farm, Ananda Gardens, to include 2 acres of hemp. He wanted to prop up his veggie business, have another baby and add onto his home for his growing family. The $50,000 contract he entered with CBD Vermont would pay for it.

"Really counting on that money," Sullivan said.

He grew the crops. CBD Vermont harvested them for cannabidiol oil. It's used in all kinds of products, claiming health benefits. And it's hot right now.

Everything seemed to be great. Sullivan and numerous Vermont farmers worked with CBD Vermont the year before. They got contracts. They were paid well. The owner even opened a store in Waterbury Center.

But then, signs of trouble. A note in the window says staff on vacation. But WCAX News learned the "Open" flag tucked in a corner isn't because of vacation. It's because the Vermont Labor Department shut the business down, through a stop-work order. State officials say CBD Vermont wasn't paying workers' compensation benefits. The owner, Doug Bell, allegedly didn't pay about 10 farmers either.

"Close to half of our annual income plus all the expenses we put into growing the crop," Sullivan said. "I really wanted to get something for all the hard work we had done."

Sullivan fears he's out his $50,000. The check CBD Vermont gave him bounced two weeks after his second daughter was born.

"I called the state police and advised there was a fraud happening on our farm," Sullivan said.

Jeff and Melanie Carpenter also grew hemp for Bell at their Hyde Park farm, Zack Woods.

"We're owed a total of $25,000 at this point," Jeff Carpenter said.

The check they got bounced, too.

"We all work really hard and we employ people," Melanie Carpenter said. "So, we have stacks of bills we need to pay and because we haven't been compensated for our work, we are all in a difficult place."

They claim Bell owes a list of farmers about half-a-million dollars in all.

"Doug Bell supposedly had a buyer for all the CBD oil that he could produce. We don't understand what went wrong and why he stopped paying the farmers," Jeff Carpenter said.

Most had their crops harvested. But for other farms, plants were left to die in the field. No cash crop-- just covered in snow. Harvesting themselves wasn't an option since it would breach the CBD Vermont contract.

"We have learned a contract is only as good as the people honoring it," Sullivan said.

WCAX News tried to talk to Bell at his Washington County home. But no one answered the door. We texted and called and finally heard back. But Bell would not speak on the record about the allegations.

WCAX News confirmed with the Washington County state's attorney that his office is working with Vermont State Police and several local law enforcement agencies on this case and an investigation is underway.

"I'm not sure I'll grow hemp again," Sullivan said.

He hopes his financial hardship serves as a lesson to other farmers.

"It seems like a great economic opportunity. You're just not expecting this sort of fraud to happen here," Sullivan said. "So be really careful about growing a big contract for a business, a hemp business."

The Labor Department also tells WCAX News it launched another investigation after learning Bell has another business, Healthy Vermont. Bell's landlord at his retail shop wouldn't say if Bell is behind on rent there but did say Bell told him he was reorganizing.