Veterans John and Kara Grady received a Facebook message last week from a man who was “looking for a female veteran to be part of our dispensary license.”
Being a veteran is one of the seven categories that makes people eligible to win one of the state’s social-equity marijuana licenses, called “microbusiness licenses.” The other categories range from having a lower income or living in an area considered impoverished to having past arrests or incarcerations related to marijuana offenses.
When the Gradys—who run Slaphappy Beverage Co., which sells hemp-derived THC drinks—turned him down, the man began attacking them on their social media pages.
“I was like, ‘What kind of tactics are these?’” John Grady said in an interview with The Independent. “You have to ask yourself—if it’s that competitive on the microbusiness licenses, then really what’s going on?”
Just hours before Grady received that message, the Missouri Division of Cannabis Regulation issued a warning about “predatory practices” in social-equity marijuana licensing throughout the country.
And those tactics are likely escalating, with the next round of applications running April 15 to 29.
“[The Division of Cannabis Regulation] has become aware of solicitation efforts by companies to apply for microbusiness licenses on behalf of qualified individuals with promises of future ownership in the license,” the agency said in a press release last week.
The division warned that some groups are scamming eligible people by giving them, “no agreements in place that would actually result in the eligible individuals being the owners of the license.”
The division recently revoked nine of the 48 social-equity cannabis licenses issued in October—following an investigation by The Independent that found some applicants thought they were partnering with the Michigan investor but in reality signed agreements requiring them to relinquish all control and profits of the business.
The revocations came just as the division was gearing up for the second round of microbusiness applications, and now the state is urging applicants to be extra careful regarding whom they partner with.
“Eligible individuals should exercise caution in accepting such arrangements as some of the solicitations may be predatory in nature,” the division’s Thursday press release states.
Because only 39 of the 48 microbusiness licenses were ultimately issued from the first round, the division will award one additional wholesale license and eight additional dispensary licenses in the upcoming round.
The owners of the revoked licenses have vowed to appeal, though nothing has been filed as of yet.
Hellbound and Down 