U.S. Attorney: Marijuana Businesses Should ‘Feel at Increased Risk’ Despite Colorado’s Regulations

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By, Kathleen Foody

DENVER (AP) — Colorado’s system for regulating marijuana has too many loopholes that disguise illegal activity and jeopardize public safety, a federal prosecutor said, detailing his motivation for boosting scrutiny in the first state to broadly allow cannabis sales.

U.S. Attorney Bob Troyer said on Oct. 3, 2018, that he is particularly concerned with how companies that grow marijuana account for damaged goods and the state’s system allowing people to grow a certain number of plants at home for medical use. He said both situations create an opportunity for marijuana to be sold on the black market and require federal prosecutors to take a closer look at Colorado’s regulated marijuana industry.

“If somebody is licensed by this state, should they feel at increased risk of federal prosecution now?” Troyer said in an interview with The Associated Press. “Yes. They should. We do a public safety analysis, not an analysis of whether someone has a piece of paper from the state.”

Troyer first discussed the enforcement shift in an op-ed published in late September 2018  by The Denver Post, writing that a successful crackdown on illegal marijuana grows on federal land has given Colorado-based authorities the resources to investigate other issues.

He said that could lead to enforcement actions against businesses licensed under the regulatory system Colorado developed after voters’ 2012 approval of Amendment 64, a constitutional amendment broadly allowing adult-use cannabis sales. State-tracked sales now total more than $1 billion per year.

“You can do plenty of harm to the community and still be in compliance with state law because those laws have a lot of loopholes and they’re very permissive,” Troyer said.

Troyer said police still find large illegal marijuana grows inside residential homes, run by organizations hoping to sell the plants in other states. Colorado lawmakers in 2017 lowered the number of plants people can legally grow at home for medical use to 16, aiming to make it harder to grow outside the regulated system undetected.

Troyer said he’s skeptical of how some growers licensed by the state account for damaged marijuana, which must be reported to regulators.

A state-commissioned study in August found that the reported percentage of contaminated or destroyed marijuana products fell from 9.2 percent of all production in 2015 to 1.9 percent in 2017. The authors said that suggested “broad improvement in compliance” and other improvements in the industry and regulatory system.

Troyer’s other concerns focus on public health, including vaping devices designed to look like highlighters or eyeliner pencils that may appeal to people younger than 21, Colorado’s legal age for marijuana use.

He also highlighted a May 2018 phone survey of marijuana retailers conducted by Denver Health researchers.

The researchers posed as pregnant women, telling marijuana dispensaries’ staffers about morning sickness and requesting advice about cannabis products. About 69 percent recommended a marijuana product to treat the side effect; fewer than a third recommended talking to a doctor first.

At the time, an industry group said the survey showed more staff education and training was needed. State regulators issued a bulletin reminding retailers about mandatory product labels warning of marijuana’s potential risks to pregnant or breastfeeding women.

Colorado’s marijuana industry has had a muted response to Troyer’s strategy.

Mason Tvert, a spokesman for The Marijuana Policy Project and a key supporter of Colorado’s constitutional amendment, said the industry has always operated in an uncertain environment, selling products that are federally illegal.

“It’s important that they take advantage of this being a regulated system and not go breaking down doors,” Tvert said. “Instead, they should be picking up the phone and calling. What they’ll find is that these businesses want to follow the rules and do whatever they can to work with local, state and fed officials to stay out of trouble.”

In response to Troyer’s op-ed, a spokesperson for Democratic Gov. John Hickenlooper said that state officials work closely with federal authorities.

“We remain committed to maintaining the integrity of the system we’ve built,” spokesperson Jacque Montgomery said. “That means attentive regulatory oversight and enforcement and, where necessary, criminal enforcement against anyone who abuses our rules.”

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Banner Caption:

Bob Troyer, the U.S attorney for the District of Colorado, said during an Oct. 3, 2018, interview in his Denver office that the state’s rules to account for damaged cannabis products and laws allowing for home growing create opportunities for licensed and regulated businesses to sell marijuana on the black market. Troyer vowed to place the marijuana industry in Colorado, one of the first states to legalize recreational use, under closer scrutiny. (Associated Press Photo/David Zalubowski)

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