Michigan outlines penalties for violators of marijuana business rules

Marijuana businesses in Michigan now will have a better idea of the penalties they might face for violating state regulations.

The state’s Cannabis Regulatory Agency (CRA) recently released a “disciplinary schedule” of different types of marijuana business violations and the corresponding fines and other penalties, Crain’s Detroit Business reported.

Response to industry complaints

According to the news outlet, the schedule is in response to complaints from cannabis industry leaders who alleged that the agency’s director, Brian Hanna, meted out penalties unevenly and arbitrarily.

“Stakeholders have been asking for the CRA to share the disciplinary guidelines and Hanna’s decision to post them is in furtherance of government transparency,” agency spokesperson David Harns said in a statement to Crain’s.

The disciplinary schedule lists dozens of fines businesses might face, according to Crain’s, including:

• $10,000 for failing to submit financial statements to the state in a timely manner.
• $500 to $10,000 for selling marijuana in non-child-resistant packaging.
• $1,000 per item sold that is above the exceeding the THC concentration allowed.

Disciplinary actions have risen

Industry stakeholders have argued that under Hanna, a former CRA enforcement agent and Michigan State Police crime analyst, the agency’s disciplinary actions have been “overbearing,” Crain’s noted.

For example, the CRA averaged only six disciplinary actions in 2022 under Hanna’s predecessor, Andrew Brisbo.

But as of last month, Crain’s reported, disciplinary actions against marijuana businesses had skyrocketed to 97, including a complaint against a marijuana processing company for allegedly buying large  quantities of unregulated THCA concentrate from outside the state and other charges.

By contrast, in the first six months of 2023, the CRA doled out 129 penalties.

The CRA is expected to release more rules in the coming months, including requiring more information from licensees, such as proof of insurance and harvest schedules, according to Crain’s.