Cannabis Licensing: Corruption in the Industry

Written by Petar Petrov

Politics have long gone hand-in-hand with corruption, operating under the cover of grand promises, altruistic campaigns, and bureaucratic mazes. And as cannabis has inevitably entered the world of politics on its march to legalization, it has collided with the giant roadblock that is corruption, as well.

In this case, corruption’s roots are perhaps a little more easily traced–hyper-localized power over licenses, limited on an arbitrary basis that provides the perfect guise for bribes in various forms, such as community impact fees and donations.

Nearly all states where cannabis is legal either bestow licensing power to local officials or impose statewide limits that don’t reflect the high market demand. Thus,  licenses–the very keys to a multi-billion dollar industry–become an extremely valuable good, which a handful of politicians in each state can auction to the highest bidder.

“We’ve seen in some states the price go as high as $500,000 for a license to sell [cannabis]. So, we see people willing to pay large amounts of money to get in to the industry,” special agent Regino Chavez says during an FBI podcast.

The charges against Jasiel Correia, former mayor of Fall River, Massachusetts, on 24 counts revolving around extortion of private citizens with cannabis dispensaries aspirations, allegedly amounting to $600,000–highlighting another example of cannabis corruption. Correia’s chief-of-staff, Genoveva Andrade, has already pled guilty to bribery and extortion charges.

The FBI is looking into “pay-to-play bribery schemes” across several states, including Missouri, Florida, and New York, something that San Bernardino mayor John Valdivia dismisses as “baseless accusations” by salty wannabe cannabis businessmen.

Moreover, former Maryland state delegate Cheryl Glenn was sentenced to two years for taking bribes to support cannabis companies, among other favors.

“Competition belongs in the market, not in the license application process,” Morgan Fox, media relations director for the National Cannabis Industry Association, says.

These, along with many other similar examples, all lead back to the arbitrary license caps, imposed not for health and safety, but for all the wrong reasons. Instead of leveling the playing field, these laws breed fierce financial competition to enter it.

Not to mention that this type of corruption enables only those with the right connections and capital to join an industry where people of color and others most impacted by the War on Drugs cannot even get a seat at the table to start.

Image Credit: Zelandia

Image Source: https://pixabay.com/illustrations/no-corruption-stop-corruption-4650589/

About the author

Petar Petrov

Petar is a freelance writer and copywriter, covering culture, art, society, and anything in-between that makes for a nice story. And as it so happens, cannabis is a great element to add to each of those conversations.