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Mar182019

Cannabis Cash and Corruption

by Lou Binninger

When Marysville decided to license marijuana dispensaries opponents accused the city of being biased as to whom would be awarded a permit to operate. Two permits were authorized by the council and a zone where they were to reside. However, the zone moved depending on who wanted a permit.

            Rumors in Sutter and Yuba County tell of offers of big money to pass favorable grow ordinances and in – kind gifts for the supervisors’ favor.

            So goes the unclean relationship as government attempts to suck more and more money from business and business attempts to avoid harassment or tries to cash-in on bureaucratic micromanaging.

            The legalization of marijuana (MJ) has brought the dirt to the surface as MJ business people troll politicians with thousands in cash and government lusts after the big MJ tax money. All the while the black market which was supposed to wane away after legalization is booming.

            An article by Patrick McGreevy in the Los Angeles Times, “California is awash in cannabis cash. Some is being used to bribe public officials,” includes an amazing collection of corruption cases while legalization is just 2-years old.

            Most will remember Sheriff Jon Lopey who was offered $1 million if he would keep deputies away from certain illegal cannabis farms in Siskiyou County. Lopey contacted the FBI who video recorded numerous deliveries of thousands of dollars in envelopes to him. The brother sister duo, Chi Yang and Gaosheng Laitinen were arrested and prosecuted.

            Most people have a price at which they can be bought.  McGreevy says, “California is awash in cannabis cash from inside and out of the state, partly because pot remains an illegal drug under federal law, so banks won’t accept cash from the businesses. The state’s black market for cannabis was estimated to be worth $3.7 billion last year — more than four times the size of the legal market, according to the firm New Frontier Data.”

            Last year, the mayor pro tem of Adelanto, Jermaine Wright was charged with agreeing to accept a bribe to fast-track a marijuana business. FBI agents also served search warrants at the home of Adelanto mayor Rich Kerr, at City Hall and at a marijuana retailer.

            Last March, a federal jury found Michael Kimbrew guilty of bribery and extortion. He was a field representative to then Rep. Janice Hahn when he took cash from an undercover FBI agent while pledging his "undying support" to protect a dispensary the City of Compton wanted to close.

            An Oakland case involves developer Dorian Gray accused of offering bribes to then-Oakland City Council President Larry Reid and Assistant City Administrator Greg Minor.  Gray allegedly offered the councilman cash to help obtain a cannabis dispensary permit, and Reid reported the offer to authorities. Gray is charged with offering Minor, who oversees marijuana permitting for Oakland, a free trip to Spain.

            Marysville Mayor Ricky Samayoa was paid $5,000 by the current Marysville dispensary during his election and during its appeal to obtain a permit to operate. The company’s application was previously rejected. Another $5,000 donation was provided by others related to the dispensary owners.

            There have been other convictions in the past as medical marijuana was permitted two decades ago. The former mayor of the City of Cudahy was sentenced to one year in federal prison in 2013 for taking cash bribes in exchange for supporting the opening of a “medical marijuana” store.

The head of the city’s code enforcement division and a city councilman were also convicted of being in on the pay-off.

“Corruption is always worse at the local level because there are so many more local officials and they aren’t under as much scrutiny as those in Sacramento,” said Dale Gieringer, director of California NORML, a pro-legalization group that supported Proposition 64. State agencies, he said, “have been doing their best to expedite licensing, but too many local players have been getting their hands in the pie.”

Law enforcement is aware of tons of marijuana being exported from California throughout the country. Sam Clauder, former congressional aide and San Bernardino County Democratic Party official pled guilty in 2017 to charges in Texas of possessing 130 pounds of cannabis on his way east from California. He said he was earning $30,000 a trip as a runner and made 45 trips prior to being apprehended.

Corruption wasn’t born with the legalization of MJ. Big money being made by business is tough for most politicians to pass-up.