FBI: Medical Pot Industry Cooperation Led to Union Official’s Indictment

By Alex Emslie

A former United Food and Commercial Workers union official and Berkeley medical cannabis commissioner is facing federal criminal charges for allegedly using his positions to solicit bribes, among other charges.

Oakland resident Daniel Rush is accused of taking bribes in exchange for the UFCW’s endorsement of prospective dispensary operators, taking kickbacks to steer clients to a co-conspiring attorney and using his position on the Berkeley Medical Cannabis Commission to extort a job from a potential dispensary operator. He’s also charged with conspiracy and money laundering.

Two things jump out from Rush’s indictment: California’s medical marijuana industry involves tons of cash that can flow to unexpected places, and several people in the medical marijuana industry were willing to voluntarily cooperate with federal law enforcement despite a rocky past.

“The focus of this investigation hasn’t been so much on that industry,” FBI San Francisco Division spokeswoman Michele Ernst told KQED on Friday. “It’s been on the corrupt activities and protecting the people who were victims of attempted extortion … people who had ended up in a position where they were seeking help from the FBI and from law enforcement.”

Rush held two powerful positions in the marijuana industry. As the executive director of UFCW International’s medical cannabis division, he could steer which prospective dispensary operators competing for limited licenses would get an influential labor endorsement, and as a Berkeley commissioner, he helped steer which operators won licenses in that city.

Ernst declined to state how many dispensary operators approached federal law enforcement, but she said, “This case would not have been possible if not for the courage of victims who came forward seeking the help of the FBI.”

According to the criminal complaint that led to Rush’s indictment, two medical marijuana operators in Oakland participated in the investigation: Carl Anderson and Martin Kaufman.

Attorney Marc Terbeek has also been cooperating with the FBI since agents served a search warrant at his offices early this year. He’s expected to plead guilty to conspiring with Rush to launder money.

Terbeek had been paying kickbacks to Rush for more than a decade, according to the complaint, in exchange for Rush diverting workers’ compensation clients to his practice. Terbeek allegedly paid Rush an average of $2,000 per month in kickbacks since 2010, the complaint says, in violation of Rush’s legal duties to the UFCW.

Rush allegedly took similarly illegal payments from other medical marijuana dispensary operators, including Kaufman and Anderson, totaling well over half a million dollars.

Rush is also accused of undermining union activities and instructing dispensary operators as to how they could secretly prevent workers from joining the UFCW, all while working for the union.

The extortion charge stems from Rush’s attempt to secure himself a high-paying job from a hopeful dispensary operator in exchange for locking in the shop’s approval with the Berkeley commission.

“What Mr. Rush has been accused of is not only shocking to us, it is a betrayal for what we at the UFCW stand for,” a union spokeswoman told the Chronicle. “Going forward, the UFCW will undertake a full review of Rush’s activities to determine if any worker or their family were adversely affected by his activities and, if so, take appropriate corrective action.”

Rush is scheduled to be arraigned on Wednesday. If convicted, he faces a maximum sentence of more than 60 years in prison.


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