Inquirer.com – Zurich DR

Category: Marijuana

  • Atlantic City’s top cannabis official was charged in a scheme to solicit bribes from a weed business

    Atlantic City’s top cannabis official was charged in a scheme to solicit bribes from a weed business

    Atlantic City’s top cannabis official is facing federal charges for a scheme to solicit cash bribes from a dispensary owner in exchange for fast-tracking their license and avoiding city fees.

    Kashawn “Kash” McKinley, 42, commonly referred to as “A.C.’s Weed Czar” for his role overseeing the city’s legal marijuana industry, was charged with honest services fraud and two counts of soliciting bribes, U.S. Attorney in New Jersey Robert Frazer announced Thursday.

    In a statement, Atlantic City officials said that Mayor Marty Small Sr. had been apprised of the case and that McKinley had been suspended without pay pending the outcome of the case. Small “believes in the justice system, and Kashawn McKinley is innocent until proven guilty, like any other American,” according to the statement, which said the mayor promised transparency around the proceedings.

    A public defender assigned to McKinley declined to comment.

    As the director of Atlantic City’s constituent services, McKinley solicited more than $20,000 in cash and marijuana from the cannabis business owner, according to federal prosecutors. In exchange, McKinley assisted the owner, who was not identified by the U.S. Attorney’s Office, in opening a dispensary and resolving certain fees owed to Atlantic City.

    The would-be dispensary owner contacted McKinley in late 2022 for guidance on opening a cannabis business in Atlantic City, prosecutors said. At McKinley’s direction, the duo first met in a parking lot of a defunct Atlantic City restaurant where McKinley told the owner that in exchange for $20,000, he could “help” resolve any issues with opening the dispensary in town, according to prosecutors.

    “We all need to eat,” McKinley allegedly told the dispensary owner at the time.

    The dispensary owner would go on to pay McKinley the $20,000 over the next few months in two installments. Soon after, the owner’s license was approved by the local oversight board, where McKinley is a member.

    Two years after opening, the dispensary owner contacted McKinley in 2025 about the more than $25,000 in fees and taxes the owner owed to Atlantic City for operating the dispensary.

    Prosecutors say that McKinley’s solution to the fees was to reclassify the dispensary from a standard mercantile license down to a “micro” license, which would result in the business needing to pay only $2,500 in annual fees and taxes.

    As part of the reclassification scheme, prosecutors say, McKinley allegedly directed the dispensary owner to orchestrate the assault of a person who McKinley said was “disrespecting” another public official. When McKinley was later shown what prosecutors say appeared to be a photograph of the injured victim, McKinley allegedly “expressed pleasure” and assured the dispensary owner that they “don’t have to worry about nothing” in relation to the disputed city fees.

    Throughout McKinley and the dispensary owner’s exchanges, the weed official would ask for “care packages,” which prosecutors believe to mean bribe payments and samples of weed.

    Since McKinley and the owner were able to reclassify the dispensary down to a micro business license in January, the owner was owed a $25,000 refund from Atlantic City for previously paying the standard license fees. McKinley requested half of that refund from the dispensary owner, according to prosecutors. In March, the dispensary owner gave McKinley a $6,000 kickback from the refund, prosecutors said.

    McKinley’s fraud charge carries a maximum sentence of 20 years in prison and a fine of up to $250,000. Each bribery charge carries a 10-year maximum prison sentence and a fine of up to $250,000.

  • Bankrupt weed company lays off 86 people at Vineland grow sites

    Bankrupt weed company lays off 86 people at Vineland grow sites

    Two cannabis grow sites in South Jersey will close their doors in October, laying off 86 staff members as multistate operator the Cannabist Company files for Chapter 15 bankruptcy.

    The cultivation facilities — located at 17 W. Park Ave. and 1560 N. West Blvd. in Vineland — will close on Oct. 11, laying off nearly all of the Cannabist’s cultivation and manufacturing employees in New Jersey according to a Worker Adjustment and Retraining Notification, or WARN, filing with the state.

    In its bankruptcy filings, the company stated that due to “regulatory, industry, and financial challenges,” it was facing a severe liquidity crisis and “unable to meet its financial obligations as they become due.” The Cannabist Company did not respond to a request for comment.

    Frank Burkhauser of Woodbury handed his phone to Cannabist employee Jennifer DeWalt so he could have a photo to remember this day that he made a legal marijuana purchase at Cannabist in Deptford on April 21, 2022. Burkhauser said he has been working for the legalization of marijuana since the early ’90s.ELIZABETH ROBERTSON / Staff Photographer

    The Cannabist’s New Jersey dispensaries were among some of the first adult-use locations to open in 2022. It operated one of the closest recreational weed dispensaries to the Philadelphia border. On the first day of Jersey’s recreational weed sales, it attracted consumers from all over, with a line wrapping around the building to the front door.

    The New York-based weed company operates 40 dispensaries and 14 cultivation and manufacturing facilities across 10 markets, including in New Jersey and Delaware. Those sites are being closed or sold off to new buyers. Last week, The Cannabist announced layoffs at one of its Denver grow sites, laying off 50 people in September, according to Colorado WARN notices.

    Customers line up just after 5:30 pm to make legal marijuana purchases at Cannabist in Deptford on April 21, 2022.ELIZABETH ROBERTSON / Staff Photographer

    Following the news of the two Vineland grow site closures, The Cannabist announced it would be selling the rest of its New Jersey operation, including the three retail stores in Deptford, Vineland, and Mays Landing, to Vireo Growth Inc for $35 million. The sale will also include some of the Cannabist’s operations in Colorado, Illinois, Massachusetts, and West Virginia markets.

    The Cannabist Co., which got its start as Colombia Care, began in Massachusetts in 2012 and soon expanded to 10 states. As of February, the company employed more than 1,200 people, including 101 manufacturing and 43 retail workers in New Jersey.

    Frank Burkhauser of Woodbury displays the legal marijuana purchase that he just made at Cannabist in Deptford on its opening day in 2022. ELIZABETH ROBERTSON / Staff Photographer

    In March, Cannabist filed for Chapter 15 bankruptcy due to owing lenders and the IRS more than $270 million. In addition to closing many operations across the country, Cannabist sold its Virginia business to Parma for $130 million, Delaware to Arboretum DE PermitCo for $16.5 million, and its Ohio dealings to Holistic for $47 million.

    Since the Cannabist Company is also filing for bankruptcy in Canada, this case is poised to be the first time a U.S. Bankruptcy Court recognizes a foreign insolvency proceeding related to a marijuana business, despite cannabis remaining federally illegal.