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AG Cynthia H. Coffman Announces Indictment of Colorado Springs Operation Alleged to have Illegally Distributed Nearly 200 Pounds of Marijuana

DENVER— Today, Colorado Attorney General Cynthia H. Coffman was joined by El Paso County Sheriff Bill Elder, Deputy Chief Mark Smith from the Colorado Springs Police Department, and District Attorney Dan May from the 4th Judicial District, to announce the indictment of an alleged criminal enterprise that illegally distributed nearly 200 pounds of marijuana through the Hoppz’ Cropz storefronts in Colorado Springs.

 

The 13 individuals indicted, including Hoppz’ Cropz owners, Joseph Hopper, Dara Wheatley, Joseph Sergio Crivici and Adam Donaldson, are alleged to have engaged in a criminal enterprise where they and their co-defendants conspired to purchase medical marijuana from licensed facilities and resell it for profit under the guise of the marijuana being offered as a “free giveaway” with the purchase of a dramatically overpriced, yet low-cost item. One ruse they used was selling cheap cigarette lighters- worth a few cents- for $15 and then “giving away” one gram of marijuana for free. The street value of one gram of marijuana is approximately $15.

 

“The members of this operation had hoped they would be able to hide their alleged illegal activity in plain sight by pretending to be a legitimate business,” said Attorney General Coffman. “Criminal activity related to black market marijuana continues to be a serious issue for communities across Colorado, which is why my office works with our state and local partners to dismantle criminal enterprises that are violating Colorado law.”

 

Hoppz’ Cropz contributed to the recreational marijuana black market while successfully evading paying fees regularly associated with retail recreational marijuana dispensary licensure and evaded excise taxes that an otherwise fully licensed retail recreational dispensary would normally be required to pay to the Department of Revenue. Despite opening a sales tax account with the Colorado Department of Revenue in July of 2016 and engaging in conventional retail sales of paraphernalia and clothing (as well as illicit marijuana sales), Hoppz’ Cropz, LLC, its owner-managers and employees failed to report the proper figures on nearly half a million dollars in retail sales. 

“Using the legalization of marijuana as a front to illegally distribute marijuana is unacceptable and it is damaging to the owners of the legitimate licensed marijuana facilities that are complying with the State laws and local ordinances,” said Deputy Chief Smith.

The managers and lower level members of the enterprise are alleged to have engaged in a second form of tax evasion by promoting and receiving “under the table” payments of wages, thereby evading the associated wage withholding taxes otherwise due to the Colorado Department of Revenue.  Managers instructed the workers to engage in deceit and inform any government officials who inquired that they –the salespersons- were merely volunteers working at their respective stores without pay. 

After executing search warrants, detectives viewed security footage from the stores showing many instances of unlawful distribution of marijuana by the employees of and an owner of Hoppz’ Cropz. 

 

The defendants are charged with a violations of the Colorado Organized Crime Control Act, Money Laundering, Evasion of Taxes, Attempting to Influence a Public Servant, Possession with Intent to Manufacture or Distribute Marijuana, and other alleged crimes.

 

The filing of criminal charges or an indictment is merely a formal accusation that an individual committed a crime. Each defendant should be presumed innocent until proven guilty. These cases will be prosecuted in Denver District Court by attorneys with the Criminal Justice Section of the Colorado Attorney General’s Office.

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CONTACT

Annie Skinner

720-508-6553

                                                                                                                                                                                                                                             Annie.Skinner@coag.gov