Massachusetts Municipalities Subpoenaed Over Potential Cannabis Industry Bribes

The Massachusetts municipalities of Eastham, Great Barrington, Leicester, Newton, Northampton, and Uxbridge have all been subpoenaed by U.S. Attorney Andrew Lelling over potential cannabis industry bribes.

Full story after the jump.

U.S. Attorney Andrew Lelling has convened a grand jury focused on the potential bribery of government officials by Massachusetts cannabis companies, the Daily Hampshire Gazette reports. The municipalities of Eastham, Great Barrington, Leicester, Newton, Northampton, and Uxbridge have all been subpoenaed by the U.S. Attorney’s Office regarding their host community agreements with cannabis firms.

The documents requested by the feds include drafts and final versions of host community agreements, communication between the municipality and cannabis companies, and public meeting records related to the agreements.

In September, Fall River Mayor Jasiel Correia was arrested for allegedly attempting to extort cannabis companies for hundreds of thousands of dollars in cash. Correia is accused of extorting at least four cannabis business operators by soliciting $250,000 each from them in exchange for “non-opposition” letters from his office. He is accused of illegally generating at least $600,000 from the scheme, as well as alleged arrangements for a future cut in some of the companies’ cannabis sales. Shortly after his arrest, the Springfield City Council launched an investigation into a $200,000 donation made by a cannabis company to the city over a five-year period.

Lelling’s office is prosecuting Correia’s case.

In order to open a cannabusiness in the state, operators must obtain these host community agreements. Under the law, those agreements are capped at either 3 percent of gross sales or must not last longer than five years.

“The costs and impacts of hosting a Marijuana Establishment will understandably vary from municipality to municipality and negotiated HCAs should reflect the particular impacts on the host community,” the Cannabis Control Commission notes in guidance issued last year.

Cannabis Control Commission Chairman Steven Hoffman said in September that the agreements “give a disproportionate advantage to bigger companies that can afford to throw in a fire truck on top of their 3 percent.”

Easthampton Mayor Nicole Lachapelle told the Gazette that she had been in contact with the U.S. Attorney’s office and that city officials “know of no wrongful conduct, or even an allegation of such conduct, by any current or former City of Northampton official or employee or by any business in connection with the cannabis industry in Northampton.”

Last year Lelling said that while his office would not provide a blanket exemption from federal laws related to cannabis, he would focus his enforcement efforts on the overproduction and diversion of products into other markets, “targeted” distribution to minors, organized crime, and the office’s resources were “primarily focused on combating the opioid epidemic.”

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