Illegal cannabis stores. While 2835 dispensaries operate without a license, only 873 have a sales license in California
Illegal cannabis stores. According to an audit conducted by the United Cannabis Business Assn that met last Wednesday, the state of California tries to legalize a cannabis economy that has long operated in legal limbo. The audit data is alarming: almost 3,000 Illegal cannabis stores operate freely in California, dwarfing by comparison to legal commerce.
Marijuana legal companies are very upset with state leaders and law enforcement for not ending the dispensaries and unlicensed delivery services that sell cannabis at a much lower price since they don’t pay state and municipal taxes on cannabis. Earlier this year, an industry-funded financial audit concluded that approximately $ 8.7 billion will be spent on illegal cannabis products in California this year, compared to just $ 3.1 billion spent on cannabis sold by legal companies.
The authorities have warned about the lack of security of cannabis products sold in the illegal market because they can be dangerous to health. Edible products, electronic cigarettes and flowers sold in stores that operate without a license have not been subject to state testing. In recent months there have been hundreds of cases of serious lung diseases related to vaping products purchased from stores that operated without a license. We recommend you read our article “What is behind lung diseases from vaping cannabis extracts?“
The United Cannabis Business Assn (UCBA), an association that represents the owners of dispensaries, growers and other licensed marijuana businesses in the state, conducted the audit by tracking the popular Weedmaps website. Lawrence Mansour, a UCBA member focused on cannabis advertising, said he estimated illegal operators by compiling a database of each listing based in California for a cannabis dispensary or delivery service at Weedmaps. Mansour said he found 3757 listings, a much higher number than the total list of approved cannabis sellers registered in the state of California.
The UCBA showed the audit findings to Governor Gavin Newsom and the cannabis agency last Wednesday. He also requested that Weedmaps activity be suppressed. Many members of the cannabis legal industry criticize Weedmaps activity because it serves to optimize the reach of illegal sellers.
According to the UCBA, every day that Weedmaps advertises to unlicensed retailers puts consumers at risk to the detriment of the legal market. Vendors who operate without a license that appear on Weedmaps do not pay taxes or the cost of compliance with local and state regulations, do not follow the security measures required by workers or consumers and do not allow unions to organize workers. These retailers that appear on Weedmaps get benefits without paying taxes to California and also risk the health and safety of state residents.
The UCBA also requested the state to retroactively impose fines of millions of dollars to Weedmaps according to AB 97, a bill that was passed in July and allows fines of up to $ 30,000 for each day a cannabis retailer operates Unlicensed. Some interpret the law in the sense that Weedmaps must also pay fines for allowing unlicensed dispensaries to advertise.
Alex Traverso, spokesman for the Office of Cannabis Control (BCC), has told the media that the agency he represents is doing everything possible to end cannabis shops without a license, which are constantly increasing. He says the office would like to be able to grant more licenses for cannabis retail stores in California, but there are certain circumstances that prevent it. With regard to illegal activity, the office will continue to fight for the laws to be applied and will continue to ensure the health and welfare of citizens. At the beginning of the year, the agency ordered 19 interventions from dispensaries without a license and confiscated $ 16.5 million in unregulated cannabis products during the first half of 2019. Both actions were more than everything that was done throughout the previous year.
The BCC also sent a letter to Weedmaps last year, demanding that the website stop working with dispensaries and stores without a license. But Weedmaps claims that it is protected from such an order under Section 230 of the Communications Decency Act of 1996, which has protected platforms such as Facebook and YouTube from liability for the content published by its users.
But last month Weedmaps has announced that it will not allow unlicensed cannabis companies to advertise on its website. This decision has been received with joy by many but there are also licensed cannabis store owners who don’t believe it. In a statement issued Wednesday, Weedmaps guaranteed that in addition to requiring new advertisers to provide a state license number, customers must also provide state identification. But despite the effort, Weedmaps chief executive Chris Beals said that the black market in California would not be really affected until more municipalities allowed the legal sale of cannabis. Chris Beals said that although he believes that these changes will hardly impact the unlicensed market in California, Weedmaps wants to be an example.
Less than 20 percent of California’s cities, 89 of 482, allow retail stores to sell cannabis for recreational use. Although many large cities, such as Los Angeles, San Diego and San Francisco, allow the sale of cannabis for recreational use, even those cities have had problems with the black market. Earlier this year, an audit found that there are at least 220 unlicensed dispensaries in Los Angeles while the city has issued only 187 temporary licenses for legal stores.
