Feds crack down on Calif. pot dispensaries

SACRAMENTO - Federal prosecutors announced an aggressive crackdown on California pot dispensaries Friday, vowing to shut down dozens of growing and sales operations and saying that the worst offenders are using the cover of medical marijuana to act as storefront drug dealers.

Officials described it as the first coordinated statewide offensive against marijuana dealers and suppliers who use California's 15-year-old medical-marijuana law as legal cover for running sophisticated drug trafficking ventures in plain sight.

"California's marijuana industry supplies the nation," said U.S. Attorney Benjamin Wagner, citing a 2009 federal study that 72 percent of marijuana plants eradicated nationwide were grown in California. "Huge amounts of marijuana grown here in this state is flowing east to other states, and huge amounts of money are flowing back in the opposite direction."

The actions were geared toward stopping a proliferation that has led to thousands of pot shops opening their doors across the state. The spread was fueled partly by the Obama administration's assurance two years ago that it did not plan to devote federal resources to countering marijuana outlets operating in compliance with state laws.

One example cited by the prosecutors Friday: In one Orange County strip mall, eight of the 11 second-floor suites are occupied by dispensaries and doctors' offices where healthy individuals obtain "sham" recommendations to use medical marijuana.

It is "a Costco, Walmart-type model that we see across California," said Andre Birotte Jr., U.S. attorney in the Los Angeles area. Some people making money from medical marijuana openly revel in what some have called "the new California gold rush," he said.

Landlords leasing property to dozens of warehouses and agricultural parcels where marijuana is being grown and retail spaces where pot is sold over the counter are receiving written warnings to evict their tenants or face criminal charges or seizure of their assets, the state's four U.S. attorneys said.

"The intention regarding medical marijuana under California state law was to allow marijuana to be supplied to seriously ill people on a non-profit basis," said U.S. Attorney Melinda Haag, the top federal law-enforcement officer for the San Francisco Bay area. "What we are finding, however, is that California's laws have been hijacked by people who are in this to get rich and don't care at all about sick people."

The crackdown comes a little more than two months after the Obama administration toughened its stand on medical marijuana. For two years before that, federal officials had indicated they would not move aggressively against dispensaries in compliance with laws in the 16 states where pot is legal for people with doctors' recommendations.

The Department of Justice issued a policy memo to federal prosecutors in late June stating that marijuana dispensaries and licensed growers in states with medical-marijuana laws could face prosecution for violating federal drug and money-laundering laws. The effort to shutter California dispensaries appeared to be the most far-reaching effort so far to put that guidance into action.

Increased federal intervention will likely unify marijuana growers and sellers in a drive to change federal policy, National Cannabis Industry Association spokeswoman Melissa Milam said.

"We're not going anywhere. We're mothers, we're patients, we're family members of patients," she said. "We want to pay taxes, we want to be able to make deposits at our bank, we want to be a business."

Not all of the thousands of storefront pot dispensaries thought to be operating in the state are being targeted in the crackdown, which also involves new indictments and arrests of marijuana growers and vendors throughout the state over the past two weeks, said Wagner, who represents the state's Central Valley.

The strategies federal authorities are using vary somewhat, with warning letters issued by the U.S. attorney in San Diego giving recipients 45 days to comply and property owners in Los Angeles, Orange County and the Central Coast given just two weeks to evict pot dispensaries or growers.

by Lisa Leff Associated Press Oct. 8, 2011 12:00 AM




Feds crack down on Calif. pot dispensaries