A man accused of running an illegal hemp operation and human trafficking in and around the Navajo Nation for years has been running a licensed cannabis farm in New Mexico, until authorities shut it down toward the end of last year.
The New Mexico Regulation and Licensing Department revoked the license of the Native American Agricultural Development Company (NAADC) in Shiprock, N.M., and fined it $1 million for eight violations of the state’s Cannabis Regulation Act. They included growing four times more cannabis than permitted, which was also not tagged as required for the state’s track and trace monitoring system, according to a final decision and order on Dec. 26.
Unrelated to NAADC, regulators also shut down Bliss Farm, doing business as Love 420 and Grown Farms, in Estancia, N.M. Bliss Farm businesses were accused of never tagging and tracking the cannabis it produced and sold during a 17-month period, according to its final decision and order, also on Dec. 26. They also were allegedly growing at least 10,000 more plants than permitted. Bliss Farm was cited for 15 total violations and also fined $1 million.
“The team worked diligently on both of these cases to determine the appropriate action for violations at a scale we hadn’t seen before,” said Todd Stevens, Cannabis Control Division Director in a press release. “The outcomes were justified under the law based on the egregious conduct of these individuals and I hope this serves as a reminder to those who might be violating the laws and rules the state has put forth.”
Benally, human trafficking and hemp
NAADC is owned by Dineh Benally, who also owned the Native American Agricultural Company (NAAC), a separate business that was accused by the Navajo Nation in 2020 of illegally growing hemp. Benally, and his companies and associates, are also named as defendants in a detailed civil lawsuit filed in September 2023 by 15 Chinese nationals accusing them of human trafficking.
The lawsuit in the First Judicial District Court in the County of Santa Fe, N.M., details a conspiracy that stretches from California to New Mexico to Oklahoma.
“On information and belief, Dineh Benally, DaMu Lin and Irving Lin met in Las Vegas in or around 2018 and planned a scheme to illegally grow cannabis on the Navajo Nation and then sell it for profit,” the lawsuit says.
DaMu Lin is CEO of One World Ventures, a publicly traded company registered in Las Vegas, Nev., and headquartered in Solana Beach, Calif. Benally was added to its board of directors in 2019. Irving Lin (reportedly unrelated) served as secretary and director of Hemp Biotechnology Inc. in Hayward, Calif.
The lawsuit claims that NAAC, CBD Group and Hemp Biotech signed a management service agreement in 2019 whereby CBD Group, a subsidiary of Cayman Islands-based SPI Energy Co., would pay NAAC more than $1.14 million “to grow and deliver hemp.”
“In 2019 and 2020, Defendants built thousands of greenhouses on the Navajo Nation in Shiprock to grow cannabis plants, which were then trimmed, packed, and sold for a profit,” the lawsuit says.
The Navajo Nation obtained a temporary restraining order in 2020. Its complaint said Benally and NAAC hired native and non-native workers, including children, to grow and furnish hemp to Navajo Gold Company, which sold CBD products in Shiprock. It said Benally was not permitted to grow hemp on the reservation. However, the operations allegedly did not stop.
The plaintiffs claimed that during the Covid-19 pandemic, Irving Lin recruited them from California via WeChat and Chinese-serving employment agencies and personally drove workers to farms in New Mexico where they were “treated like machines.”
They believed they “would be cutting flowers or performing farm work for a decent wage, but were then coerced by guards, who kicked, cursed and barely fed them, to work 14-hour days sitting on upside-down buckets in unventilated hotel rooms trimming illegally-grown marijuana,” states the lawsuit, which details abusive and grueling working conditions.
The plaintiffs said they were told they would be paid $200 a day but “never received a penny for their labor or for their suffering.”
After the TRO was issued, the defendants moved the operation to a Travel Inn hotel in nearby Farmington. Farmington police raided the hotel in October 2020 and arrested the workers on site. While the charges were later dropped, the plaintiffs claimed that the media coverage of their arrests, including mug shots, “made it impossible for Plaintiffs to find work in the Chinese community,” according to the complaint.
In November 2020, federal, state and tribal authorities raided Denally’s and Lins’ farms and found nearly 250,000 plants, reported Searchlight New Mexico.
Benally, representing himself in the lawsuit, denied the allegations in a response filed Jan. 5. He seeks to have the case dismissed stating the state court lacks jurisdiction because all of the alleged crimes and properties are in the Navajo Nation.
According to Searchlight New Mexico, tribal prosecutors must defer to the U.S. Attorney General, leading to frustration among tribal authorities.
“To date, nobody responsible for the harm caused to the Navajo Nation and to these workers by Benally and his associates’ illegal marijuana operation has been prosecuted,” Navajo Nation Attorney General Ethel Branch told Searchlight.
A web spreading from California to Oklahoma
Benally’s partner Irving Lin is also tied to illegal operations in California and Oklahoma. Lin is believed to be a resident of Monterey Park, Calif., but was also living in Kirtland, N.M., during the time of the operations, according to the complaint.
Oklahoma law enforcement and politicians have been long claiming that alleged Chinese cartels and immigrants are behind illegal cannabis operations in the state. On Jan. 10, Oklahoma Attorney General Genter Drummond testified about it to the House Committee on Homeland Security during the impeachment hearing of Secretary Alejandro Mayorkas. Law enforcement in that state has been clamping down on illegal activity.
According to the human trafficking lawsuit, Lin recruited Chinese individuals to invest and work in Oklahoma operations, promising to make each of them a “millionaire.” On Feb. 22, 2022, the Oklahoma Bureau of Narcotics raided Big Buddha Farms in Wilson, Okla., owned by one of Lin’s associates, as part of a wider enforcement action.
OBN Chief Information Officer Mark Woodward confirmed, “Lin is tied to the Big Buddha investigation.”
That same month, Lin was arrested in California as part of the Operation Hammer Strike enforcement action, according to the lawsuit.
As of Jan. 8, 2024, Lin still holds a pre-license for a producer/microbusiness in Waterflow, N.M., according to the CRB Monitor database.
New Mexico permits Benally to grow again
Meanwhile, despite being under investigation for illegal marijuana trafficking by state and federal authorities, the NMRLD awarded Benally cultivation permits for two NAADC locations in Estancia and Waterflow.
NMRLD spokeswoman Andrea Brown said to CRB Monitor in an email that under current law, the Cannabis Control Division cannot deny or revoke a license unless the controlling person has been convicted of an offense that is substantially related to holding a cannabis license.
“To the Division’s knowledge, this licensee has not been convicted of a qualifying offense,” Brown said.
The original, “parent” license was issued on Oct. 26, 2022, and expired a year later. A sublicense was issued June 8, 2023, for the Estancia location, which was inspected on Sept. 11.
A compliance officer observed 41 cannabis rule and law violations that day. In addition to the excess cannabis and track and trace violations, they included no cultivation plan, no lighting plan, no scales, no video surveillance system and a spider mite infestation.
Benally attended an evidentiary hearing in November. He did not deny any of the allegations and took personal responsibility, according to the order. He claimed that he couldn’t upload information into the track and trace system because the location did not have internet access.
“Mr. Benally did, however, testify that he did not live onsite and internet service was available at his home,” the order said.
Benally said he had asked if he could increase his grow limit and was told he would need to pay a fee of $5 per plant, but he didn’t have the funds at the time.
“Mr. Benally did not explain why he apparently went ahead without the additional permits and planted approximately four times (4) times more plants than were allowed,” the order said.
After deciding that Benally had not presented sufficient evidence to rebut the accusations, NMRLD Superintendent Clay Bailey revoked the license and fined NAACD $1 million, due in 90 days.
An email to NAADC seeking comment was unreturned.
Bliss Farm didn’t love track and trace
Meanwhile, Bliss Farm and its licensed businesses have been under regulatory scrutiny since last summer.
During an inspection in June 2023, inspectors identified 26 violations of the Cannabis Regulation Act and approximately 50,000 plants growing at Bliss Farms’ facility in Estancia, N.M. During a hearing in August, the company claimed all the violations had been rectified, according to the final decision and order. But by Oct. 19, 19 violations still existed, including unsanitary working conditions and C02 tanks that weren’t strapped down, regulators said.
Neither Love 420 nor Grown Farm uploaded cultivation and sales information into the BioTrack system from April 1, 2022, to Sept. 21, 2023, according to inspectors. The licensees were permitted to grow 20,000 plants. But upon reinspection, compliance officers saw 30,000 plants.
While the businesses were originally cited for 17 violations, the hearing officer agreed with 15 of them, Brown said.
Bliss Farm’s producer license, as well as Love 420’s and Grown Farm’s vertically integrated cannabis establishment licenses were revoked. Grown Farm’s license had actually expired July 8, 2023. “However, because of the complex licensing structure of the cannabis operations on that property, all licenses that were active at the time, or had been active were included in the proceedings,” Brown explained.
According to the CRB Monitor database, Bliss Farm is owned by Chunlei Zhao, who co-owns RTNM Inc.