The New York State Office of Cannabis Management (OCM) today sent letters ordering businesses suspected of illegally selling cannabis, including the practice of “gifting,” to cease and desist those operations or risk the opportunity to get a license in the legal market as well as substantial fines and possible criminal penalties. The letters explain that while cannabis has been legalized for those aged 21 and over, selling it requires a license under the law.
Recent media reports have described business operators selling a product or service, including club memberships, to consumers and providing cannabis as a “gift” in return. This activity is illegal under the Marijuana Regulation and Taxation Act (MRTA). Through an initial investigation, the OCM has identified over two dozen alleged violators and sent letters to each educating them on the law and directing them to stop their illegal activity immediately.
“We have an obligation to protect New Yorkers from known risks and to strengthen the foundation of the legal, regulated market we are building. We will meet the goals of the MRTA to build an inclusive, equitable and safe industry,” said Cannabis Control Board Chair Tremaine Wright. “Therefore, these violators must stop their activity immediately, or face the consequences.”
“We want to make sure these operators fully understand the law and the consequences they face and now that these letters have been sent, we fully expect them to cease and desist their activities – if they don’t, we will take action,” said OCM Executive Director Chris Alexander. “New York State is building a legal, regulated cannabis market that will ensure products are tested and safe for consumers while providing opportunities for those from communities most impacted by the over criminalization of the cannabis prohibition, and illegal operations undermine our ability to do that. We encourage New Yorkers to not partake in illicit sales where products may not be safe and we will continue to work to ensure that New Yorkers have a pathway to sell legally in the new industry.”
No adult-use licenses have been issued in New York State to date. The only legal means of procuring, safe, tested cannabis products is through the Medical Cannabis Program, where becoming a patient requires getting certified from a medical provider.
Under the MRTA, OCM’s role is to enforce the rules it develops for the three prongs of the industry it oversees – the Medical Cannabis Program, the Cannabinoid Hemp Program, and the Ault-use Cannabis Program. The office works with governmental partners to enforce the law. A sample letter is available here.
To report illicit activity to the OCM, please send an email to [email protected].