New Mexico cannabis applicants are not subject to federal background checks

A Larry Barker KRQE News 13 Investigation

NEW MEXICO (KRQE) – It was a monumental measure vigorously debated, approved by lawmakers, and signed into law two years ago. The Cannabis Regulation Act was heralded as the most sweeping drug policy reform in New Mexico’s history. Today, with more than 1000 licensed pot shops across the state, it’s as easy to buy a joint as it is to buy a quart of milk.

In order to protect the integrity of the new marijuana industry, lawmakers inserted a provision in the law requiring federal FBI criminal background checks on high-level applicants for cannabis industry licenses.

“It was important to ensure that individuals who are applying for a cannabis license as part of a business establishment don’t have a criminal background,” Regulation and Licensing Superintendent Linda Trujillo says. “We don’t want to have criminals licensed in New Mexico using the marijuana location as a way to launder their money from other criminal activities,” Albuquerque State Representative Bill Rehm (D-Albuquerque) said.

Since the recreational marijuana industry was legalized more than 2600 individuals have been licensed. How many of those have had a federal FBI criminal background check? None. RLD Superintendent Linda Trujillo admits if somebody applies for licensure in the cannabis industry and they have a significant out-of-state criminal background, “unless they told us we would not know about it.”

At the 2021 Special Session, lawmakers made FBI background checks a key provision of the Cannabis Bill. However, nobody bothered checking with the FBI. It was only after recreational marijuana became legal that state officials discovered a glitch in the statute. According to the FBI, a section of the new law does not comply with federal requirements. As a result, the FBI is not performing federal criminal background checks on high-level New Mexico cannabis applicants.

“The only records that we technically (can) get are state criminal records. … You could have someone from out of state who attempts to get a cannabis license and we won’t get information about their criminal history in other states, RLD Superintendent Trujillo says.

“I was shocked. I mean, it’s unbelievable,” says State Representative Bill Rehm who is a retired law enforcement officer. “Criminals here in New Mexico, from out of state, can come in here and get licensed and we wouldn’t even know it,” Rehm says.

“This is why we don’t ram through legislation in a Special Session before anybody can spot problems with the bill because then we have stuff like this come out,” says Luke Niforatos, Vice-President of the advocacy group S.A.M. (Smart Approaches to Marijuana). “Your viewers should be very concerned about the fact that (the state is) not looking at the federal backgrounds of people applying for marijuana licenses in New Mexico. What this means is that right now, the state could be giving legal sanction to members of cartels,” Niforatos said.

Case in point, last year, New Mexico’s Cannabis Control Division issued a Producer’s License to a business entity operating out of a northeast Albuquerque warehouse. According to RLD documents, the facility owner told a state investigator his business partners were “…(Mexican) Sinaloa Cartel members and have been threatening his life.” The Cannabis facility owner added, “he was scared of what could happen to him” and that his business partners told him “they have disposed of dead bodies for the Sinaloa Cartel … and would harm him if he didn’t comply with their demands.”

In January, state regulators alleged the marijuana production facility committed violations of the Cannabis Regulation Act, including improper transportation of marijuana. The case is pending. In May the two businessmen accused of links to the Sinaloa Cartel were removed from the firm’s cannabis license.

RLD Superintendent Linda Trujillo says in order for the department to run FBI background checks on Cannabis industry applicants state lawmakers will need to amend the Cannabis Regulation Act. In January, during the 2023 Legislative Session, State Representative Tara Lujan (D-Santa Fe) introduced House Bill 331 to clean up language in the Cannabis law to authorize the federal FBI background checks. “The consequences of us not passing this legislation is that we open ourselves up to licensees coming into the state and not having a full background check and just not knowing if they have a criminal background that would compromise this industry,” State Rep. Tara Lujan said.

Rep. Lujan’s House Bill 331 was neither political nor controversial and had bi-partisan support. However, legislators apparently thought FBI background checks weren’t very important. Rather than fixing the problem, lawmakers opted to look the other way. The measure died in the House Judiciary Committee without even a hearing. FBI background checks will just have to wait. Perhaps next year? State Rep. Lujan says she will ask the Governor to make this issue a priority in 2024.

“This should not be controversial. This is not about politics or whether we think marijuana is good or bad. This is about just doing the bare minimum to protect New Mexico’s families,” Luke Niforatos said.

“(The Cannabis) legislation invites criminal activity when you can’t do the background checks,” State Rep. Bill Rehm says. “We need to fix it and we need to fix it quickly.”