IRS and DEA Raid Marijuana Growers in Denver

On Thursday, federal agents with the Internal Revenue Service (IRS) and Drug Enforcement Administration (DEA), as well as local law enforcement officers, conducted a raid of an unknown number of businesses in the Denver area preparing to participate in personal marijuana sales beginning on January 1.

The raids were the first since Colorado voters passed Amendment 64 on November 6, 2012, legalizing the growth, distribution, and sale of recreational marijuana to individuals aged 21 and over.  As a part of the raids, the agents seized marijuana plants and various products containing marijuana.

The sale of marijuana in Colorado is presently legal only to those who have a medical reason to purchase the drug.  Many of the hundreds of businesses that have historically sold marijuana for medical purposes are taking the necessary steps to provide marijuana for recreational use.  Some of those businesses were involved in the raid.

IRS, DEA Raids for Violation of Federal Guidelines

Although personal marijuana sales are illegal under federal law, the U.S. Department of Justice announced in August that it would not interfere with the sale of recreational marijuana as legalized by Colorado and other states, so long as businesses followed the eight-point federal guidelines concerning marijuana.  Those federal guidelines include the following:

  • providing marijuana to those under the age of 21
  • selling of marijuana to criminal organizations
  • distribution of marijuana to states that have not passed laws allowing recreational use of marijuana
  • selling other illegal drugs in addition to marijuana
  • using violence to carry out the distribution and sale of marijuana
  • driving under the influence of marijuana
  • using public lands for the growth of marijuana plants
  • possessing marijuana on federal property

According to a statement released by Jeff Dorschner, a spokesperson with the U.S. Attorney’s Office, the businesses searched in the raids had violated one or more of those federal guidelines.

“The Drug Enforcement Administration, Internal Revenue Service Criminal Investigations, the Denver Police Department, and state and local law enforcement are today executing lawfully obtained search warrants and seizure warrants,” noted Dorschner.  “Although we cannot at this time discuss the substance of this pending investigation, the operation under way today comports with the department’s recent guidance regarding marijuana enforcement matters.”

A spokesperson with the IRS declined to comment on the raids.

Local Industry Representatives Support Raids, Other Marijuana Industry Regulation

Representatives of the marijuana industry in Colorado were supportive of the raids, noting the raids did not indicate the federal government would interfere with the recreational sale of marijuana but rather would enforce the guidelines agreed on by the industry.  Mark Eilliott, a spokesperson for the Medical Marijuana Industry Group, was one of those who released a statement in support of the raids.

“While everyone involved in these raids should be considered innocent until proven guilty, enforcement is a sign that this program is working and maturing,” noted Elliott in his statement.

Mason Tvert, a spokesperson for the Marijuana Policy Project, also commented on the raids.

“We do not yet know the details of these latest federal actions, so it is too soon to say what inspired them,” said Tvert.  “The Justice Department said it would respect states’ rights to regulate marijuana, and that it would not go after businesses as long as they are complying with state laws.  We hope they are sticking to their word and not interfering with any state-regulated, law-abiding businesses.”

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by Mark Johnston

Mark has been a contributor to legal web sites related to bankruptcy, tax, and criminal law since 2011. He has an Accounting degree from Texas A&M University.