New York could get $200,000 fines for illegal pot shops

New York authorities would be given the power to shut down illegal pot shops and impose fines of up to $200,000 under legislation proposed by Gov. of New York. Kathy Hochul is trying to protect the stalled legal weed market.

The attempt is part of the push to get the state's potentially billion-dollar adult legal market moving. There have been three legal shops opened in New York City and two upstate NY.

The existence of illegal dispensaries is unacceptable, and we need additional enforcement tools to protect New Yorkers from dangerous products and support our equity initiatives," Hochul said in a statement. In January 2022, Hochul created a $200 million public-private fund to support social equity applicants.

The bill would give the cannabis office more authority to seize illegal products and set up procedures for the government to shut down unlicensed businesses, of which there are thousands in New York City in the form of smoke shops and all manner of bodegas and convenience stores. New York reserved its first round of retail licenses for nonprofits, applicants with marijuana convictions and their relatives in an effort to address inequities arising from the war on drugs. The process itself has been besieged with lawsuits and legal challenges from cannabis companies arguing that the process favors New York residents over out-of-state residents in violation of constitutional interstate commerce protections.

Emily Paxhia, co-founder of Poseidon Investment Management, credits New York with good intentions on social equity but said the state was shortsighted about the need to put in place enforcement early on against illegal shops.

Paxhia, who grew up in Buffalo, said he is still hopeful that the New York market turns around.

Come and meet Emily Paxhia and many others who are making positive and essential changes in the cannabis industry at the Benzinga Cannabis Capital ConferenceBenzinga Cannabis Capital Conference on April 11 -- 12.

Other speakers at the Benzinga event include Twitter executives Alexa Alianiello and Rohan Routroy, who will talk about the role of the social networking giant in the cannabis industry - a topic that Elon Musk, CEO of Tesla, Inc. TSLA and Twitter TWTR made headlines last month by allowing cannabis advertising on the platform.