Pot kingpin accused of running ILLEGAL marijuana dispensaries in LA

A businessman who co-founded one of the cannabis industry’s largest companies has been linked to multiple illegal marijuana dispensaries across Los Angeles. 

Tony Huang, 41, and his holding companies are alleged to own nine properties that have been used as sites to unlawfully sell cannabis, according to the Los Angeles Times. 

He started Stiiizy, which grows, distributes and sells cannabis legally throughout California, in 2017 with army veteran James Kim and it has grown to generate an estimated $300 million in annual revenue.

But a pending abatement suit by Compton city claimed Huang ‘is also known for his serial operations of various illegal cannabis dispensaries’. It alleged he ‘controlled the illegal sale of marijuana from the property’ as the landlord.

Huang has denied any wrongdoing, and a spokesman for him said he purchased investment properties that tenants used as illegal cannabis dispensaries without his knowledge and in violation of the leases. He does not own any of the properties today.

Businessman Tony Huang, who co-founded one of the cannabis industry’s largest companies, has been linked to multiple illegal marijuana dispensaries across Los Angeles 

Huang and his holding companies are alleged to own nine properties that have been used as sites to unlawfully sell cannabis, according to the Los Angeles Times

He started Stiiizy, which grows, distributes and sells cannabis legally throughout California , in 2017 with army veteran James Kim and it has grown to generate an estimated $300 million in annual revenue

Documents and interviews with law enforcement officials and dispensary employees pointed to ties between Huang’s buildings and unlawful cannabis stores linked through real estate deals, common lenders or shared tenants.

However, Huang’s spokesman Michael Sitrick said he tried his best to evict tenants and when that failed, he would sell the properties. 

‘Mr. Huang did not know in any instance that an unlicensed or illegal dispensary was operating on his properties when he rented them,’ he said. 

‘Mr. Huang has been trying his best to disentangle himself from any investments connected to the sale of unlawful commercial cannabis.’ 

Code enforcement inspectors in Compton discovered a black market dispensary called Fly High 20 Collective inside a store called Jerry’s Liqour back in 2019.

Authorities investigated and found the property was actually owned by Huang although his spokesman said the businessman did not know about this operation and was not involved.

Sitrick added that Huang ‘will work cooperatively with the city of Compton to establish that allegation is false.’

He bought the building on Rosecrans Avenue in October 2018 through holding company Compton Great Investment.

The city alleged that the Fly High 20 Collective sold cannabis at the property ‘illegally, openly and notoriously’ for years.

But Sitrick said Huang was not complicit in the sales and would ‘work cooperatively’ to prove it.

Stiiizy claims to be a ‘lifestyle brand’ and it sells merchandise, hosts live events and donates cash to social justice causes.

It now has 31 dispensaries in California and says it is committed to helping poorer neighborhoods ‘heal from the devastation done by the war on drugs.’

Huang is ‘chief visionary officer’ of the Shryne Group, the parent company of Stiiizy, and he applied for a cannabis license in Pasadena, which he described as ‘a bit of a homecoming for me.’

But while this was pending, police were investigating an illegal dispensary at a property he owned. It was opened in a former dress shop on Green Street.

Authorities were trying to work out whose building it was but ‘one LLC led to another LLC which led to another LLC’, according to code compliance manager Jon Pollard.

‘It’s not criminal in and of itself,’ he said. ‘But it’s indicative of an intent to possibly obscure true ownership of the properties.’

The utility bill was being paid by another holding company, Pollard testified in front of a city commission. 

However, when he called the phone number listed on the bill, he said: ‘I was connected to Tony Huang.’

Huang’s spokesman said he bought the property as an investment but did not know it would be used as an illegal dispensary when renting it out.

The businessman was then cited and fined by Pasadena authorities, and his lawyers promised to evict the tenant.

But the illegal dispensary stayed open. Pollard told the commission that the outcome of eviction cases depends on ‘the tenacity that you push it through the courts’.

Code enforcement inspectors in Compton discovered a black market dispensary called Fly High 20 Collective inside a store called Jerry’s Liqour back in 2019

Authorities investigated and found the property was actually owned by Huang although his spokesman said the businessman did not know about this operation and was not involved

Compton city alleged that the Fly High 20 Collective sold cannabis at the property ‘illegally, openly and notoriously’ for years

Huang’s spokesman Sitrick said the tenant refused to leave and his client urged the city to raid the building.

Police then served a search warrant and seized $1,714 in cash, cannabis and arrested four people. The property was then sold by Huang to an optometrist.

Pollard claimed Huang’s company rented out the building for $10,000 a month, which was twice the market rate, to then-22-year-old Amy Sahadi Diaz.

‘Not that you can’t be an enterprising person at 22 years old,’ he said. ‘You can. [But] in my estimation, it’s an amalgamation of individual issues that cause me to consider, precisely what is going on here?’

Diaz, now 27, has been described as an elusive figure in court records with attorneys complaining they’ve been unable to serve her court papers.

She leased eight properties over 16 months in South Los Angeles, Huntington Park, North Hollywood, Compton and San Bernardino, which have been identified as illegal cannabis dispensaries.

The rent for each property ranged from $2,000 to $10,000 each month.

Huang bought a property on Arrow Highway in March 2018 and sold it three months after it suffered its second robbery in August 2019.

It was being used as an illegal dispensary Azusa’s Finest but the businessman said he did not know this until he got a notice from the city. He said he sold it after failing to evict the tenant.

Investigators found that a woman named Reyna Mejia, then 22, opened up a utilities account for the building five months after it was bought by Huang.

She leased three properties in Boyle Heights and south Los Angeles that were used as unlawful marijuana dispensaries, according to lease agreements and eviction notices.

Azusa’s Finest and three other dispensaries in east and south Los Angeles were found to have owed $4.8 million by tax officials, and the state decided that Mejia was responsible for paying it.

A separate property which Huang bought in July 2017 in Florence-Firestone on 83rd street was used as a dispensary and raided by the sheriff’s department twice.

They seized thousands of dollars and cannabis. It was being rented by Mejia who was later evicted, according to the Los Angeles Times.

Huang’s company settled the case by paying a $50,000 fine and promising not to lease it to a ct cannabis expo company.

He later sold the building in 2021 to JXTZ Investment Group which also bought two other properties Huang previously owned.

Cannabis was still sold on the property despite the raids, eviction and sale and two more search warrants were issued in 2022, the publication alleged. 

In July, the JXTZ Investment Group sold the property to a mid-city company which has evicted the same tenant, Diaz, from its buildings in Compton and North Hollywood for using them as illegal dispensaries, it reported. 

Another dispensary called the Green Garden Collective was raided four times by the Los Angeles Police Department between July 2019 and April 2020, according to the Los Angeles Times. 

The former hair salon in Westmont was bought by Huang just 25 days before the first raid.

Huang bought a property on Arrow Highway in March 2018 and sold it three months after it suffered its second robbery in August 2019

It was being used as an illegal dispensary Azusa’s Finest but the businessman said he did not know this until he got a notice from the city. He said he sold it after failing to evict the tenant

Sitrick said he sold the property three months after he learnt it was being used as an unlawful dispensary ‘contrary to what was stated in the lease’.

It was bought by Philip Oh who also took over the Azusa’s Finest property from Huang’s company.

The Los Angeles attorney’s office charged Huang and Oh with violating the city’s prohibition on unlicensed cannabis sales.

Prosecutors dismissed other charges against Huang for a no contest plea to a misdemeanor electrical code violation and probation for a year.

While Oh was fined $4,100 and sentenced to a year of probation.

Huang sold a Florence Avenue store to Oh in October 2019 and it is was searched by the LAPD nine times between March 2019 and October 2021, the publication stated. 

Authorities seized cannabis, cash and guns from the illegal dispensary called the Plug 20 Cap, according to the abatement lawsuit against Huang.

His spokesman Sitrick said Huang bought the building in 2017 and tried and failed to evict the tenants who opened the unlawful dispensary without his knowledge.

Huang then sold the storefront to Oh but Compton lawyers slammed the sale as a ‘sham’.

The businessman’s company loaned Oh’s company $440,000, which was the amount paid to buy the building and this created a lien against the property for its full value, according to the city.

Huang’s companies also loaned money to Oh’s entities which bought the Azusa’s Finest and the Green Garden Collective sites, according to property records.

The loans were secured using liens against the properties for $478,000 and $230,000, respectively. 

But Huang maintains these transactions were legitimate and that he had issues finding buyers so he sold them with ‘owner-carried’ loans.

Lawyer Ekwan Rhow who is representing Huang and Stiiizy said his client sold the Florence Avenue building years before Compton ‘falsely alleged’ he was part of illegal cannabis sales.

Huang and Oh reached an agreement to pay the city $450,000 without admitting any wrongdoing in order to resolve the matter.

Following this, Huang told KTLA-TV Channel 5 he could have proved at trial that he knew nothing about the illegal cannabis sales but he decided to pay a ‘small fine’ for ‘convenience only.’

Huang sold the Compton building that was used to run Fly High 20 Collective in 2021.

It was handed to a company whose manager controlled another entity which bought the properties where the Azusa’s Finest and the Plug 20 Cap dispensaries were.

Fly High 20 Collective was once again raided on April 20, 2022 by sheriff’s deputies who noted that all three safes ‘were open and empty prior to our arrival’.

The dispensary later closed down permanently.

Diaz leased a building called Holmes Collective on Firestone Boulevard in Los Angeles for $7,000, and it was used as an illegal cannabis dispensary, according to the Los Angeles Times. 

An elderly couple owned the property and thought they were renting it out to a licensed marijuana business, the publication reported. 

Their attorney Hasti Rahsepar said: ‘The unfortunate thing is they pay a lot of money. They pay good money and they pay cash.’

Authorities seized cannabis, cash and guns from the illegal dispensary called the Plug 20 Cap, according to the abatement lawsuit against Huang. His spokesman Sitrick said he bought the building in 2017 and tried and failed to evict the tenants who opened it without his knowledge

Another dispensary called the Green Garden Collective was reportedly raided four times by the Los Angeles Police Department between July 2019 and April 2020. The former hair salon in Westmont was bought by Huang just 25 days before the first raid

Rahsepar filed a pending eviction case against the operators of the dispensary which was raided by the Sherriff’s Department in September 2022.

But the attorney believes Diaz was ‘simply a proxy, a front.’ 

Diaz acknowledged working for illegal dispensaries in an interview with the Los Angeles Times but said she never leased them.

She added that she never knew who she was working for as she felt ‘the less questions I asked, the better.’

Diaz got into the industry aged 19 and earned $12 an hour at a dispensary in Compton.

She claimed that three months later, her bosses asked her for personal information as a part of getting a license for the shop and she provided her driver’s license and birth certificate.

Diaz later learned that the owner of a building on Central Avenue was suing to evict her and this was the first time her name had appeared on the lease of a dispensary.

‘Someone literally forged my signature and had my ID,’ she said.

The city attorney at the time accused the shop, called Kush Klub 20, of selling marijuana laced with toxic chemicals which sprayed on golf courses and Diaz was listed as a defendant.

A default judgement was secured against Diaz for $8.8 million and she claimed she was not aware of this until a reporter told her about it.

Ben Spinner, who represents the property owner, said he was contacted by a broker about leasing the property and was sent Diaz’s details.

His client agreed to rent it out to her without a credit check or verifying her information.

The lease was for $10,000 a month and it was said to be used for ‘church and all other legal related issues’.

Spinner said a man who he believed was Diaz’s boss provided the rent and security deposit in cash.

Lawyers for Compton said in the lawsuit that the lease was a ‘fraudulent’ scheme and needed a ‘judgment-proof individual’.

Diaz claimed she did not take any money to sign a dispensary lease and said: ‘I wish that were the case. I’d be a few thousand dollars richer.’ She also denied signing any leases for the businesses.

She and Huang say they do not know each other and she said she never signed the Pasadena lease.

His spokesman Sitrick said Diaz’s ‘representative’ arranged the agreement without ever meeting Huang.

She insisted she did not know the owners of the two San Bernardino buildings where she is accused of signing leases for dispensaries.

Stiiizy claims to be a ‘lifestyle brand’ and it sells merchandise, hosts live events and donates cash to social justice causes 

It now has 31 dispensaries in California and says it is committed to helping poorer neighborhoods ‘heal from the devastation done by the war on drugs’

Huang initially grew marijuana in his garage and sold it on to a medical dispensary in Marina del Rey where he took on a role as a bud-tender.

He opened his own licensed dispensary in Santa Ana in 2014 but was charged with several felonies. 

Huang was accused by Los Angeles County prosecutors of making his own hashish and growing weed inside a Rowland Heights property and moving it for sale as well as vandalism and grand theft against Southern California Edison.

His spokesman said it was due to him ‘experimenting’ with extracting hash oil and that he ‘tried it once, failed, put everything in a closet and left it there’. 

Huang pleaded no contest to the manufacturing hashish and vandalism charges and records say he served 15 weeks in jail.

But Sitrick said his client recalls spending 10 days in custody and serving the rest of his 180-day term under house arrest. 

He sought to get off probation and get his conviction removed two years later so issued a letter to the court. 

He said he committed the crimes when ‘my back was against the wall and I saw an easy way out to pay the bills’ and a judge granted Huang’s motion in 2017, the same year he co-founded Stiiizy.

Attorney Rhow claimed it was ‘obvious’ that the information was leaked from a former executive at Stiiizy. 

A spokesman for Huang said: ‘All of these landlord issues date back several years, and Mr. Huang does not own any of the properties today. 

‘He was not and is not involved in any way in any illegal dispensaries. Mr. Huang did not know in any instance that an unlicensed or illegal dispensary was operating on his properties when he rented them. 

‘If and when he learned of this activity, he would evict or try to evict any tenant operating an unlawful dispensary at one of his properties if he could, or would sell the property if the tenants were uncooperative.’

DailyMail.com has contacted the Shryne Group, Rhow, Diaz, Mejia and the city of Compton for comment. 

CaliforniaLos Angeles