Oregon’s New Secretary Of State Withdraws Controversial Marijuana Audit That Led To Predecessor’s Downfall

“My team and I concluded that the selection of the audit, the framework for the audit, and potential predetermination of its conclusions imperiled the audit from the outset.”

By Julia Shumway, Oregon Capital Chronicle

New Oregon Secretary of State Tobias Read (D) on Wednesday withdrew the scandal-marred audit of the state’s liquor and cannabis commission that ended a predecessor’s political career.

“My team and I concluded that the selection of the audit, the framework for the audit, and potential predetermination of its conclusions imperiled the audit from the outset,” Read wrote.

Former Secretary of State Shemia Fagan (D) resigned in disgrace in May 2023 after reporting from Willamette Week revealed she had taken a $10,000-per-month consulting gig for the cannabis company La Mota while her office’s Audits Division reviewed the Oregon Liquor and Cannabis Commission.

The commission regulated La Mota, along with other cannabis retailers. The resulting marijuana-friendly audit, titled “Oregon Liquor and Cannabis Commission: Oregon Needs to Modernize Cannabis Laws to Help Grow the State’s Economy and Ensure Equitable Opportunities and Benefits for all Communities,” immediately came under scrutiny.

Public records showed that Fagan repeatedly pressed auditors to speak with Rosa Cazares, a La Mota owner and Fagan campaign donor, and that she let Cazares edit a description of the audit. Fagan also didn’t recuse herself from the audit until two months before its release, when most work was already done.

After Fagan’s resignation, the Oregon Department of Justice recommended the Secretary of State’s Office remove the audit from its website while reviewing whether it complied with auditing standards. Then-Secretary of State LaVonne Griffin-Valade, a Democratic former Multnomah County auditor appointed by Gov. Tina Kotek (D) to finish Fagan’s term, declined to remove it.

Griffin-Valade said at the time that the audit was of the same quality as others released by the agency and should remain online.

“The public interest in this case is best served by independent auditors providing evidence-supported recommendations to state government,” she said. “Neither my review nor any other has uncovered a reason to think this report is anything short of that standard.”

Read, the former state treasurer elected as secretary of state in November, said in a letter explaining his decision that he knew it was “proper and just” to remove the cannabis commission audit based on an analysis from Steve Bergmann, the new director of the Audits Division.

He added that Griffin-Valade and previous agency leaders committed to implementing some improvements to the audit process recommended by the Department of Justice but didn’t do so.

“The flawed selection and framework of the audit, the failure to carry out process improvements and public records exposed by investigative reporting all evidence a process that did not honor this agency’s responsibility to Oregonians,” Read wrote.

He said the audit team will revisit an audit of the Oregon Liquor and Cannabis Commission in the future.

This story was first published by Oregon Capital Chronicle.

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