The sale of marijuana may be legal in Colorado, but it's still possible for store owners to be charged criminally for violating the law for excessive sales of marijuana. There are limits on how much marijuana the retailers in Colorado can sell to customers. However, at the Sweet Leaf, the owners entered a guilty plea to selling to customers who bought the daily maximum but would then come back repeatedly on the same day and buy the maximum allowed per day more than once. The practice is known as "looping" and it is prohibited under Colorado law. The maximum per person per day is just that, a maximum.
According to the charges and plea, not only were the owners aware of the repeat sales, but they would call their "loopers" to let them know when the marijuana shipments were arriving so that they could begin their looping. The Denver police began an investigation of "Sweet Leaf" based on a tip from neighbors who complained that they were seeing the same customers coming back. There were two owners who entered a guilty plea, but their pleas came after 12-clerk employees entered their guilty pleas to knowingly selling an amount of marijuana over the statutory maximum.
The two owners of Sweet Leaf had to surrender their business license and they are both prohibited from participating in the marijuana business in Colorado for 15 years. Their prison sentences were for one year each, with a year of probation following. The magazine, Marijuana Business, did an article on Sweet Leaf that showed the company had 350 employees and $60 million in revenue, until the businesses were closed following the charges.
There are now 10 states and Washington, D.C. that permit the sale and use of marijuana for purposes other than medicinal. This case was followed carefully by these states because of their need to study how marijuana sales are done and the possibility of criminal activity.
Another law enforcement concern with this new industry is the sourcing of the marijuana. Police suspect that Sweet Leaf was also involved in buying black market marijuana. These kinds of nefarious activities have kept banks from doing business with the marijuana sellers because of the potential for racketeering charges, charges that could be brought based on money laundering or concealing evidence. Many banks have avoided doing business with the marijuana dealers because of their fears of federal investigations. Banks that have served as bankers for marijuana businesses have seen their business and profits grow. There are rumblings that larger banks may join the ranks in order to avail themselves of the increasing profits from what is a low maintenance business, Carol Ryan, "Weed vs. Greed on Wall Street," Wall Street Journal, Jan. 26-27, 2019, B12.
If sale of marijuana is legal, why is there a prosecution?
What are the types of crimes that can be prosecuted for money?
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