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FBI Investigating and Seeking Tips on Corruption in US Cannabis Industry

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The FBI is looking into potential corruption in the burgeoning U.S. marijuana industry – particularly in Western markets – and is seeking tips to investigate.

“As an increasing number of states change their marijuana legislation, the FBI is seeing a public corruption threat emerge in the expanding cannabis industry,” FBI spokeswoman Mollie Halpern said on a podcast released by the FBI on Thursday.

“States require licenses to grow and sell the drug – opening the possibility for public officials to become susceptible to bribes in exchange for those licenses.”

In March, the Los Angeles Times published an article looking at several instances of alleged public corruption related to cannabis licensing in California. Such incidents include the case of a mayor pro tem who was charged with taking a bribe to fast-track approval for a marijuana business and a congressional staffer who was found guilty of accepting cash from an undercover FBI agent after pledging to defend a cannabis dispensary from being closed by local officials.

“We’ve seen in some states the price go as high as $500,000 for a license to sell marijuana. So, we see people willing to pay large amounts of money to get in to the industry,” Supervisory Special Agent Regino Chavez said in the podcast.

And FBI Intelligence Analyst David Kirschner said the issue won’t be disappearing anytime soon.

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Several industry sources have separately confirmed to Marijuana Business Daily that they’ve spoken with FBI agents in recent years.

What they’ve often discussed is the possibility of corruption and pay-to-play situations in the awarding of business licenses.

NORML Executive Director Erik Altieri said he agrees that federal law enforcement has a role to play in stopping bad actors in the cannabis industry.

“As awkward as it feels to sort of side with the FBI, it is imperative that states ensure the licensing for cannabis businesses is an open and fair process,” he said. “NORML believes that we need to lower barriers to entry in the emerging legal marijuana market so it allows for small consumer oriented businesses to thrive and provides support for equity programs that would let those who were most targeted by, and suffered under, our decades long failed war on marijuana to benefit from its now legal status.”

“Cronyism, corruption, and corporate takeovers are not unavoidable side effects of legalizing marijuana and they should be rooted out immediately,” he said.

Morgan Fox, media relations director for the National Cannabis Industry Association, said that while the FBI’s call for tips “strikes me as a fishing trip” because marijuana-related public corruption doesn’t appear to be an especially prevalent problem, he agreed with NORML’s Altieri that regulatory changes are needed.

“An easy way to avoid corruption becoming an issue is to get rid of arbitrary license caps and lower the barriers of entry for the industry,” Fox said. “Not only would this make it easier for small businesses and people from marginalized communities to enter the industry, but it stops licenses from being treated as limited commodities that are so valuable that people may be willing to obtain them through unethical means.”

“Competition belongs in the market, not in the license application process,” he said.

The just-over-one-minute segment ends with a plea for listeners who “suspect a dispensary is operating with an illegally obtained license, or suspect public corruption in the marijuana industry” to contact their local FBI field office.

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