Hundreds of illegal NYC pot shops have dodged millions of dollars in fines: council report

Hundreds of padlocked pot shops found guilty of breaking the law in the Big Apple have avoided paying millions of dollars in fines, a City Council analysis shows.

Since April, administrative judges have substantiated violations in 516 cases against illegal cannabis shop owners and slapped them with a combined $5.21 million in fines.

Penalties were paid in only 21 cases and totaled $210,000, according to the review by the council’s Committee on Oversight and Investigations.

That means $4.98 million in fines remain unpaid for 495 violations, the report said, citing data from the city Sheriff’s Office and Department of Finance.

“It’s an astounding amount of fines that are unpaid,” said Councilwoman Gale Brewer, who chairs the investigations committee.

Since the Adams administration’s Operation Padlock began in the spring, the city Sheriff’s Office issued 1,178 violations against 1,107 unlicensed weed operators, and nearly all of the shops were padlocked or at least temporarily shut down.

Of the 991 violations that went through the legal process, 516 cases were substantiated, and 288 cases resulted in default judgments, with $2.85 million in penalties imposed.

Another 188 violations were dismissed, and 187 violations are pending adjudication before the city’s Office of Administrative Trials and Hearings.

Under a move approved by Gov. Kathy Hochul earlier this year, the sheriff’s office and the NYPD have the authority to immediately padlock unlicensed shops pending administrative hearings over allegations of illegal activity.

Unlicensed operators can get slapped with fines of $10,000 per day for selling cannabis without a license, escalating to $20,000 per day for continuing unlicensed sales after receiving a notice of violation.

Landlords who fail to initiate eviction proceedings against illicit cannabis stores they lease to could get hit with $50,000 in fines.

Brewer, who is holding a hearing Tuesday on the city’s cannabis enforcement program, did praise the crackdown that has shut down hundreds of unlicensed weed shops.

“The enforcement has put a dent in the illegal market. It’s helped the legal market. That’s good  news,” said the councilwoman, who represents the Upper West Side, which has been inundated with unlicensed smoke shops.

The analysis showed that in one-third of the 51 City Council districts, more than 20% of the violations were dismissed.

Brewer also is seeking to find out how many of the padlocked shops accused of selling weed without a license have reopened.

Before the crackdown, Mayor Eric Adams and Sheriff Anthony Miranda estimated there were 2,200 unlicensed smoke shops.

There are 189 licensed cannabis dispensaries and delivery operations in the entire Empire State, of which 79 are in the city, according to the state Office of Cannabis Management.

The mayor’s office said many fines haven’t been collected yet because the city doesn’t have the authority to do so, but it soon will.

“We are hoping to start the collection process very soon, but we are hitting these bad actors where it hurts by going after their stream of revenue — already confiscating over $64 million in illegal products — and our goal with these operations has always been to protect public safety and health, and particularly young New Yorkers. It’s clear we’ve been successful,” City Hall said in a statement.