Cannabis Industry – Banking

TRANSCRIPT

Another one of the greatest challenges being faced by the cannabis industry is banking. It is a full cash industry. They aren’t even supposed to use credit cards. Although it’s being allowed right now. Banks are forbidden from doing business with the cannabis industry because the banks are FDIC insured federally and cannabis is still federally illegal it’s a schedule 1 substance meaning it has no medicinal merit which is weird because its medically legal in more than..well more than half the states at this point, but no one ever said the DEA was current or quick. Hopefully, that happens soon. There’s another banking bill going through congress again this year. Maybe this year will be the time where people can finally bank, but now that you’re talking about an all-cash industry it becomes really difficult to account in a matter that satisfies the government because people that are licensed need to pay their correct taxes both to the state of California and the United States government and they want strict accountings. They want all the receipts kept. They want the income, the outgo. They want everything and what is so fraught with peril about that, is that if accounting isn’t doing well, if it isn’t done contemporaneously and money goes missing, the first thing you can see is a money laundering charge coming down the pipe and that not what you want to have. It’s hard for a prosecutor to get a conviction on a cannabis case even in a federal court where it’s completely illegal. People just don’t see it as illegal. They don’t see the cases as things that should be brought. It’s just a waste of their time, but not so with money laundering and if each business cant prove where each cent came from.. we’re starting to see sometimes kind of meaner jurisdictions that have allowed this but perhaps it was very split and the police were against or the prosecutors were against it and weren’t going to have it. We’re beginning to see money laundering prosecutions.

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