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Medical Marijuana Enforcement Division cuts out middle man in legal cannabis sales

Getting a commission for setting up a transaction is completely legal in any number of legitimate industries, including stock trading, real estate and auto sales. So why not for medical marijuana? Because if we've learned one thing over the past several years in Colorado, it's that medical marijuana doesn't work like any other industry, for no reason whatsoever. That's why.

An interesting back-and-forth was posted September 20 on the state Medical Marijuana Enforcement Division website's Laws and Regulations page.

It seems that back in June, attorney Sean McAllister petitioned MMED to clarify wholesale cannabis rules on behalf of his clients. His query focused on state regulations that require a medical marijuana business to disclose all direct and indirect financial assistance that it receives; McAllister argues that the law's language isn't clear regarding whether brokering a deal between two centers would be considered "financial assistance."

In fact, he says, it's not clear whether a person is allowed to broker a transaction between two MMJ businesses at all, much less whether he or she is entitled to a percentage of the sale -- and whether it has to be reported to the MMED.

MMED director Laura Harris finally responded to McAllister's petition on September 20. According to her, medical marijuana center owners are only allowed to make money from transactions related to the medical marijuana centers in which they have an ownership interest.

"The [state law] not only mandates that the State Licensing Authority require a 'complete disclosure of all persons having a direct or indirect financial interest' in each license issued, but it also prohibits individuals from having an unreported financial interest in a license," Harris wrote. "The [MMED] believe a commission in this instance would constitute an indirect financial interest in another licensee's license, and such activity is not allowed."

This interpretation would also indicate that individuals without a direct-ownership interest in a medical marijuana center are not allowed to broker any transactions, because, according to Harris's reading of the law, you must be an owner to buy or sell wholesale cannabis in Colorado.

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