Largest U.S. Banks Host Accounts for Marijuana Businesses, Says American Banker

FLORIDA: A recent study commissioned by industry journal American Banker reveals that the nation’s four largest banks have opened accounts for pot shops and marijuana-related businesses. Conducted by MRB Monitor, a firm that helps financial institutions identify the risks associated with the marijuana industry, the study examined public records in the state of Massachusetts and found that 34 percent of businesses that filed to operate medical marijuana dispensaries in Massachusetts between June 2015 and September 2016 had one or more accounts at Bank of America, Citigroup, Wells Fargo, or JPMorgan Chase.

If a similar pattern of working with the marijuana industry takes hold in Washington D.C. and the U.S. states that have legalized marijuana, the prospect of financial services for cannabis outfits may not be as dire as it at first appears.

Bank of America seems to have been the most accommodating. Over half of the marijuana businesses included in the survey had accounts at the bank, though it previously told the Statesman Journal that, “As a federally regulated financial institution, we abide by federal law and do not bank marijuana-related businesses.”

Guidelines issued by federal authorities in 2014 appeared to have offered financial institutions a legal avenue to provide their services to marijuana-related businesses (MRBs). Back then, the Financial Crimes Enforcement Network (FinCEN), part of the U.S. Treasury Department, provided guidance[3] it said was meant to enhance the availability of financial services for, and the financial transparency of, marijuana-related businesses.

Yet, under the Controlled Substances Act (CSA), it is illegal to manufacture, distribute, or dispense marijuana, and marijuana – like heroin, LSD and ecstasy – remains a Schedule 1 substance under the statute.

In December 2016, U.S. Senator Elizabeth Warren, D-Mass, a member of the Senate Banking Committee, along with nine other senators sent a letter to FinCEN requesting guidance on how banking services might be offered to ‘indirect businesses’ that provide services to the state-sanctioned marijuana industry.

Hopefully, after nomination season comes to a close, a response to that letter will be forthcoming; there’s a lot at stake. As ArcView Market Research wrote, “Cannabis is arguably the fastest growing industry in the world. Regulated marijuana sales in North America totaled $6.9 billion in 2016, a 30 percent increase from 2015. Sales are projected to increase to $21.6 billion by the year 2021 representing a 26 percent compound annual growth rate.”

CannaScore Offers Free Compliance Auditing Tool After Bank Revoked Its Credit Card Processing Privileges

COLORADO: CS Compliance Systems, developers of CannaScore – the world’s first real-time regulatory compliance auditing application for the cannabis industry, announced that its credit card processing privileges were revoked after their bank realized that CannaScore was providing services to the marijuana industry. In response, the company announced that it is now offering its products free of charge, on a limited basis.

“It is absurd that we had our credit card processing revoked,” said Thomas Smith, Managing Partner of CS Compliance Systems. “CannaScore is a software application that helps cannabis businesses stay compliant with the complex web of regulations that govern this sector. Ironically, some of our biggest customers are banks, because they like to use our auditing tools to give them assurance that their cannabis-based business customers are following all regulations.”

After the company had its credit card processing revoked, management decided to offer the award winning product suite at no cost, for a limited time. Cannabis growers, producer processors, dispensaries, retailers, extract and edible manufacturers, along with those that do business in the marijuana sector, including insurance companies, landlords, and yes, banks, can now visit the CannaScore website and use the system for no charge.

“Our team comes from within the compliance and cannabis industries,” Smith said. “We are not Wall Street outsiders. We are a team of dedicated professionals that knows this industry inside-out, and has developed an innovative program designed to protect cannabis-businesses,” he added. “Now we share some of the same challenges with banking that our customers face on a daily basis.”

To take advantage of the free use of the CannaScore system, log on to www.cannascore.net and follow the link to “Free Trial.”

The PayPal Of Recreational Pot: Startup Aims To Eliminate Cash From Washington State Marijuana business

WASHINGTON: Recreational marijuana may be legal in Washington state, but in many ways, it’s still a risky business.

The biggest risk is that nearly all transactions happen with cash. And not just customers buying marijuana, but much bigger transactions when retailers buy from the producers that actually grow the pot.

Everyone uses cash because banks, which are federally regulated, aren’t keen on the idea of getting into business in an industry that is still federally illegal.

Now, there’s a company that’s bringing electronic payments to the world of recreational marijuana, and it could be a game-changer.

I-502 Compliant Banking & Merchant Services Is Monday, June 29th In Bellevue, WA

WASHINGTON: If you have anything to do with banking or merchant services for Washington’s legal cannabis industry, you’ll want to make sure to attend the Marijuana Business Association’s Professional Education Seminar on I-502 Compliant Banking & Merchant ServicesMonday, June 29th, 2015 1:00-4:30PM a the Red Lion Hotel, 11211 Main St. Bellevue, WA 98004. Featuring an impressive lineup of the state’s leading authorities on cannabis industry banking and finances, the event was organized by the MJBA at the behest of state’s I-502 Licensees and applicant, MJBA members and other cannabis industry service providers. The half day seminar will feature presentations and panel participation from:

  • Washington State Department of Financial Institutions Director of Banking, Rick Riccobono;
  • Timberland Bank COO, Jonathan Fischer
  • Washington Liquor and Cannabis Board CFO, Mike Kashmar
  • Legal Officer at Foundry Law Group and I-502 Retail Licensee Myles Kahn
  • PayQwick CEO Ken Berke and CFO Keith Marks
  • President & Executive Director of the Community Bankers of Washington, Mark MacDonald
  • Moderation, David Rheins, Executive Director of the Marijuana Business Association

Foundry Law Group will sponsor a post-event reception at the hotel bar at the conclusion of the seminar.