Iowa Sen. Chuck Grassley, the committee's top Republican and co-chairman of the Senate Caucus on International Narcotics Control, said the Justice Department is "giving the green light" to an industry bent on breaking federal law.
Grassley said that Colorado has seen a sharp uptick in diversion of marijuana from Colorado to other states and increased use among minors.
"I understand the skepticism that you come to it with," Cole told Grassley. "We have reserved, quite explicitly, the right to go in" and challenge the regulatory programs of Colorado and Washington.
Grassley asked what the Justice Department plans to do to protect states like Iowa from marijuana being diverted from states like Colorado. Cole responded, "If it's being exported from Colorado to Iowa and we find out about it, we will prosecute."
With the door to legalization open in two states, others could follow.
The 20,000-member Marijuana Policy Project says it will support efforts to end marijuana prohibition in 10 more states by 2017.
In a harshly worded letter to Holder this week, nine former Drug Enforcement Administration chiefs predicted that "when marijuana will be fully legal to buy, diversion of the drug will explode."
Associated Press writers Kristen Wyatt and Colleen Slevin in Denver contributed to this report.