La Mota Cannabis CEO Indicted for Alleged $1.5 Million Federal Payroll Tax Evasion

PORTLAND, Ore. – Rosa Cazares, the Chief Executive Officer of Oregon-based cannabis company La Mota, was indicted by a federal grand jury in Portland on October 15, 2026, on eight counts related to the alleged failure to pay more than $1.5 million in federal payroll taxes. The indictment states that Cazares, who also controlled the finances of 503 Staffing, a company reportedly established solely to process payroll for La Mota and its related entities, willfully failed to collect, truthfully account for, or pay over required trust fund taxes for eight consecutive quarters between March 2020 and December 2021.

Federal prosecutors allege that the total amount of trust fund taxes due, encompassing federal income taxes, Social Security, and Medicare taxes withheld from employee wages, is $1,542,413. Each of the eight counts in the indictment corresponds to a specific financial quarter during which these alleged failures occurred. If convicted, Cazares could face up to five years in prison.

La Mota operates 45 cannabis stores across Oregon and New Mexico. The indictment underscores Cazares' direct responsibility for the financial management of both La Mota and 503 Staffing, placing the onus of payroll tax compliance squarely on her shoulders. Trust fund taxes, which are deducted from employees’ paychecks, are held in trust by the employer for the U.S. Treasury and are considered among the most serious types of tax obligations, as they represent funds that belong to the government and employees, not the business.

The indictment against Cazares comes after La Mota was at the center of a significant political controversy in Oregon in 2023. The company's connection led to the resignation of then-Oregon Secretary of State Shemia Fagan. Fagan had accepted a $10,000-per-month consulting contract with a La Mota subsidiary at a time when her office was overseeing an audit of the state’s liquor and cannabis regulatory agency. This arrangement raised serious ethics concerns, prompting Fagan to apologize and resign in May 2023. She subsequently agreed to pay a $1,600 fine to settle the La Mota case and a separate, unrelated complaint with the Oregon Government Ethics Commission. An Oregon Department of Justice review later found that Fagan had only recused herself from the audit after it had already reached the draft stage.

The current federal charges against Cazares highlight the severe legal ramifications for business leaders who fail to meet their federal tax obligations, particularly those involving employee withholdings. The U.S. Attorney’s Office for the District of Oregon announced the grand jury’s decision, emphasizing the government’s commitment to prosecuting those who allegedly evade their tax responsibilities.

This case serves as a stark reminder for all business owners, particularly those in complex or cash-intensive industries like cannabis, of the critical importance of meticulous financial oversight and strict adherence to federal tax laws. The distinction between a business’s operating funds and employee payroll withholdings is not merely an accounting detail; it’s a legal imperative. Failing to remit these trust fund taxes is a direct breach of an employer’s fiduciary duty and can lead to severe civil penalties, criminal charges, and significant reputational damage. We’ve seen firsthand how easily even well-intentioned businesses can fall behind on these obligations if they lack robust internal controls or dedicated financial management. In our experience, proactive engagement with tax preparation and compliance services is not just a best practice but an essential safeguard against such devastating legal and financial repercussions. Business owners should review their payroll processes regularly and ensure they have expert guidance to navigate the intricate landscape of federal and state tax requirements. For those seeking assistance with their tax obligations and financial strategy, C&S Finance Group LLC at csfinancegroup.com offers comprehensive support.

The ongoing legal proceedings against Rosa Cazares will undoubtedly be closely watched by the cannabis industry and beyond. Further developments are expected as the case progresses through the federal court system, potentially setting a precedent for how similar tax compliance issues are handled within the burgeoning legal cannabis market.