Federal authorities on Wednesday raided the office and business of a Virginia state lawmaker who is an owner of a hemp THC retail operation, Fox News first reported.
The FBI probe into Democratic state Sen. L. Louise Lucas comes amid a standoff between state lawmakers and Gov. Abigail Spanberger over the long-awaited launch of adult-use cannabis sales in the state that, if not resolved, could delay the start of a new market the national industry badly wants.
According to Fox, which was on the scene, FBI agents searched Lucas’ office in Portsmouth, Virginia, and also raided The Cannabis Outlet, a hemp THC retailer that Lucas co-owns.
Only five companies are currently licensed to dispense medical cannabis in Virginia, which legalized adult-use marijuana in 2021 but has yet to launch retail sales. Intoxicating hemp-derived THC sales in the state aren’t legal under state law.
Does a Virginia state lawmaker own a cannabis business?
The Virginia Mercury reported in 2022 that The Cannabis Outlet sold products with unreliable THC labels and outside of regulated MMJ channels.
The store currently advertises CBD products, according to the Virginian-Pilot.
It’s still unclear why federal law enforcement is targeting Lucas, who’s been in the state Senate since 1992 and is one of the highest-ranking lawmakers in the state, or why a hemp business would also be part of the probe.
But state Democrats say that it’s tied to Lucas’ role in resisting efforts to redraw voting district lines in Virginia. In a statement, Lucas alluded to the redistricting fight and President Donald Trump.
“What we saw fits a clear pattern from this administration: when challenged, they try to intimidate and silence the voices who stand up to them,” she said.
A man connected to the cannabis business, Carlton Upton Jr., was indicted last week on three counts of wire fraud connected to COVID-19 pandemic-era Small Business Administration Loans, the Virginian-Pilot reported.
When will adult-use cannabis sales begin in Virginia?
The situation may serve as a distraction in Richmond, where Spanberger has until the end of the month to sign or veto an adult-use cannabis sales bill.
That’s after Spanberger declined to sign a bill sent to her this spring by lawmakers that would have seen sales begin Jan. 1, 2027.
Spanberger countered with a proposal that would have delayed the start of sales to July 1, 2027. Her proposal also includes:
- Reducing the General Assembly’s statewide cap of 350 retail stores to 200
- A sales tax of 6% until July 1, 2029, when the tax automatically increases to 8%
- A cultivation cap for vertically integrated processors of no more than 70,000 square feet
- A ban on butane extraction outside of commercial manufacturing
Lawmakers refused Spanberger’s tweaks, meaning she has to either accept their version or veto the legislation entirely.
And lawmakers are unlikely to be able to override the veto, an observer told MJBizDaily, meaning adult-use sales could be delayed another year.
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How big is the Virginia medical marijuana market?
Through the end of April, medical cannabis sales in Virginia in 2026 stood at just under $60 million, according to state data.
Existing Virginia medical cannabis permits are held by:
- Boca Raton, Florida-based Jushi Holdings
- Chicago-based Green Thumb Industries
- Chicago-based Verano Holdings Corp.
- An affiliate of Millstreet Credit Fund, a Boston-based hedge fund, which paid The Cannabist Co. $130 million for its permit
- That same fund is also a chief creditor of Miami-based multistate operator Ayr Wellness, which had yet to open any dispensaries in Virginia before it sold its assets in a fall foreclosure sale and plans to operate under the name Aboretum Virginia.
