Pots Of Marijuana Cash Cause Security Concerns

COLORADO:  The unmarked armored truck rumbles to a stop in a narrow alley, and former U.S. Marine Matthew Karr slides out, one hand holding a folder, the other hovering near the pistol holstered at his hip.

With efficient motions he retrieves a locked, leather-bound satchel from a safe set into the truck’s side and presses a buzzer outside the door. It swings open to reveal a cavernous warehouse filled with marijuana and a safe stuffed with cash.

Welcome to the rear guard of Colorado’s rapidly expanding legal marijuana industry, where eager users pour millions of dollars — most of it in small bills — into buying pot, hashish, and marijuana-infused foods and drinks. All that cash adds up, and there are few places to put it: Federal regulations, which still classify pot as an illegal drug, make it difficult for marijuana producers to deposit their profits into traditional bank accounts.

And those cash-heavy small businesses make awfully attractive — and vulnerable — targets for criminals.


Marijuana Banking: Secretive But Poised To Grow

WASHINGTON: Many marijuana business owners say they have bank accounts, but aren’t completely forthright with their bankers about the nature of their businesses. They claim to be in “consulting” or “medical research.”  And they know they could lose those bank accounts suddenly, at any time, since federal law prohibits banks from holding any funds associated with illegal drugs.

Now in the wake of Initiative 502, which legalized marijuana in Washington state, some banks and credit unions may be ready to officially open accounts for marijuana businesses. Numerica, a Spokane Valley-based credit union, has announced it will accept state-licensed businesses as clients.

Seattle attorney Robert McVay with the Canna Law Group said there are more to come.

“Small banks, especially the community banks, are certainly looking into it if only because it’s a new industry and whoever takes that first plunge, whoever takes the risk, is going to get lots and lots and lots of business,” McVay said. “We’re working with a couple financial institutions here in the state that are likely going to do this.”

Pot Holders

WASHINGTON: On Valentine’s Day, the U.S. Treasury Department issued a memorandum clarifying the government’s advice to the nation’s banks about how to deal with the booming cannabis industry. It wasn’t exactly a love letter.

Sure, Treasury outlined a series of guidelines for “assessing the risk of providing services to a marijuana-related business”—but was that meant to be taken as advice to banks for getting into the weed game, and why would Treasury be telling banks how to get into the weed game if there were risks?

Most bankers and “potpreneurs” shrugged. The memo made clear that the manufacture and distribution of marijuana remains a federal crime, under the Controlled Substances Act, which means bankers who knowingly grant checking accounts or loan money to anyone in the cannabis industry risk federal prosecution for money laundering or conspiracy. Pot growers and dispensers worried they would still be hauling around bagfuls of cash, and claiming they operate such legitimate enterprises as sports bars and strip clubs when they really sell cannabis. Treasury’s letter wouldn’t change anything.

Except it has. That memo may have offered little more than tacit approval of banks’ getting into business with Mary Jane, but it was enough of a wink and a nod to convince at least a couple of brave (or desperate) banks or credit unions to stick their necks out and roll the dice, if not the doobies.