By:  Serach Nissim

New York State seems to be starting to crackdown on unlicensed cannabis shops.

As reported by Crain’s NY, last week state inspectors placed signs on the store windows of seven unlicensed smoke shops, notifying passer-byers that illicit merchandise was seized from the stores.  None of the seven stores were closed and there were no fines tacked on in last week’s sweep. However, those will be the likely next steps, said a lawyer for a one of the stores searched.  That shop, located near Washington Square Park at 736 Broadway, is just 250 feet away from a licensed dispensary.  The unlicensed 2,500 square foot store was sued earlier this year by the city, for illegal sales bongs and similar merchandise.  Attorney Michael Becker said inspectors were searching the location frantically for weed, and even opened up a wall without a search warrant. They reportedly didn’t find anything.  “I’m told the store had no inventory,” said Becker, a partner at Rutherford Christie. “They’re really hellbent on closing this particular location.”

Per Crain’s, since last month, state cannabis regulators have enforcement power to begin their crackdowns.  The sweeps last week seem to be easing them in.  There are reportedly some 1,500 unlicensed cannabis shops across New York City, which if left unchecked, will make it extremely difficult for the dozen licensed dispensaries in NYS to do business with all their extra taxes.  The licensed shops have been reportedly been asking the state for help to alleviate this seemingly indomitable competition which has popped up all across the city over the past two years.   “This has been a long time coming,” said Jeffrey Hoffman, a lawyer for several licensed cannabis shops. “If you want to solve this problem quickly, fine the landlords and take their buildings.”

Under the law signed in Albany, the regulators could have immediately fined the unlicensed cannabis retailers $10,000 a day, when they showed up last week.  It seems they chose to take it step by step.  “It would appear it’s only starting a clock,” said Paula Collins, a cannabis attorney in the West Village.  The unlicensed shops can make up to $15,000 in revenue daily, Collins said.   So even shutting them down will be a difficulty, because they can simply relocate.  “This is different from Prohibition, when the government was closing down the stills and speakeasies,” Collins added. “I honestly don’t know how the state will be able to effectively close the shops and then keep them closed.”

Per Crain’s, the seven illegal shops targeted last week included: Roll 2 Nation at 738 Broadway; Baby Jeeter at 793 Broadway; Maze at 16 St. Marks Place; LaGuardia Smoke at 510 Laguardia Pl;  Play Lane at 117B W. 23rd St; and Nomad at 59 W. 30th St.  The Office of Cannabis Management put up signs on their windows facing the street, which read:  “Warning: This business is ordered to stop illegal activity.”

“The state will not stand idle as unlicensed operators break the law and sell untested products to underage New Yorkers,” Gov. Kathy Hochul said in a statement. “These enforcement actions are critical steps to protect and help those individuals who were promised a shot to start a legal business and be successful.”