Los Angeles – Federal agents trailed Sparky Rose as he drove a Porsche Carrera convertible to his medical marijuana clinic.
Under California law, clinics are supposed to dispense marijuana just to seriously ill people and clinic owners are to get only “reasonable compensation.” But to the U.S. Drug Enforcement Administration, the sports car suggested that Rose might be pocketing big money from his purportedly nonprofit clinic, New Remedies Cooperative.
Rose was arrested in October and accused of illegal drug trafficking – which he denies. According to court papers, an investigation turned up records showing $2.3 million was deposited in a New Remedies bank account over eight months starting in December 2005, and Rose wrote himself weekly checks of $9,600.
California was the first of 12 states to allow the sale of marijuana for medicinal purposes, mainly pain control, and is regarded as having the loosest regulations.
Oversight is lax and there are few specific guidelines for buyers and sellers of a drug still illegal under federal law.
Who can open a clinic, what constitutes reasonable compensation and who can grow and supply marijuana are all open to broad interpretation – factors that have helped fuel a surge in new clinics, to about 400 statewide. Los Angeles alone has about 100.
Oakland, Santa Rosa and even famously permissive West Hollywood are among cities that have imposed moratoriums on new clinics amid concerns owners and buyers are abusing the law. Los Angeles Police Chief William Bratton has called for a similar moratorium in his city.
The DEA also has taken notice, targeting clinics run by people who appear to flout the reasonable compensation provision.
DEA spokeswoman Sarah Pullen said authorities chose clinics that were making big money, had become hot spots for crime or were part of large franchises. The raided clinics on average raked in $20,000 in profits each day, she said.
Many clinics were buying pot wholesale from street dealers and reselling it for twice the roughly $100-an-ounce black-market rate, Pullen said.
That investigation is continuing and has yet to produce any arrests or charges. The author of the 2003 medical marijuana law, then-state Sen. John Vasconcellos, has no problem with clinic owners earning hefty salaries as long as they provide help for ill people. He said the federal government should mellow out.
