A Crackdown on Unlicensed Cannabis Businesses in Washington D.C.
On Friday, September 13th, Green Cloud Shop, an unlicensed cannabis business in Washington D.C., was shut down by authorities. This action is part of a broader crackdown on illegal cannabis operations in the city.
The Alcoholic Beverage and Cannabis Administration (ABCA), along with the Metropolitan Police Department (MPD), padlocked the shop and arrested its 49-year-old owner. He faces charges of Possession with Intent to Distribute and Operating a Business After Certificate of Authority had been revoked.
This measure comes amidst an ongoing conflict with unregulated "gift economy" cannabis shops. These shops have long exploited a loophole by "gifting" marijuana with the purchase of other products, allowing them to bypass laws against recreational cannabis sales. However, city officials are now stepping up enforcement, viewing these shops as a major threat to the legal medical cannabis market.
The crackdown is backed by the D.C. Council, including progressive members, due to concerns about crime around all-cash businesses and the proximity of some shops to schools and daycare facilities. This action follows the D.C. Council's approval of an emergency bill earlier this year, granting city officials the authority to impose penalties on unlicensed cannabis stores.
Green Cloud Shop's closure is part of a new wave of enforcement following the Medical Cannabis Conditional License and Unlicensed Establishment Closure Clarification Emergency Amendment Act of 2024. This law, enacted in July, grants the ABCA enhanced authority to close illegal businesses.
Green Cloud is the second illicit cannabis business closed by ABCA since the new law went into effect. Interestingly, authorities reported padlocking the access to the store, echoing a similar tactic used in New York's crackdown on illicit cannabis earlier this year.
In addition to closures, the ABCA has issued cease-and-desist orders and warning letters to unlicensed cannabis businesses. However, many shops continue operating, with only a few forced to shut down. Property owners of these illicit shops could face a $10,000 fine if they fail to comply with the ABCA's closure orders.
The crackdown comes at a crucial time for D.C.'s legal medical cannabis market, which has been struggling to compete with unlicensed operators and facing stiff competition from Maryland's legal recreational market. Since January 2024, D.C.'s legal market has seen a significant decline, selling less than 400 pounds of flower per month.