Colorado’s New Pot Banking Law Won’t Solve Cash Problems

COLORADO: Colorado Gov. John Hickenlooper signed a bill Friday designed to create the world’s first state-level banking system for legal cannabis companies, which have complained that their lack of access to basic banking services creates difficult and dangerous risks.

But the financial industry quickly cast doubt on whether the legislation will address issues faced by marijuana businesses in the state, where recreational pot became legal this year. Asked what it would accomplish, Colorado Bankers Association CEO Don Childears said: “Basically, absolutely nothing.”

“We don’t think it can be effective, and it can never get off the ground,” he said.

The bill allows legal marijuana shops to create a makeshift financial network that would help them gain access to credit and merchant services.

Your Money Stinks

COLORADO:  A Few years ago, a Boulder woman who owned one of Colorado’s first dispensaries ran into some troubles with her bank. As she later recounted, the bank told her the money she was depositing into her business account reeked of marijuana.

The bank was willing to take her money, but she would have to do something about the smell. Maybe Febreze would help. Her bank, in other words, asked her to literally launder her money.

Since then, the relationship between marijuana businesses and their banks has only become more fraught and complicated. Talk to anyone involved in Colorado’s marijuana industry—regulators, market players, law enforcement—and they’ll likely agree that the biggest obstacle to bringing marijuana out of the shadows is the industry’s inability to obtain basic banking services.