As Pot Firms Operate In Cash, “Banking Is The Most Urgent Issue”


Legal marijuana merchants in Colorado and Washington are grappling with a pressing predicament, reports the New York Times: Their businesses are conducted almost entirely in cash because it is difficult for them to open and maintain bank accounts, and thus accept credit cards. They pay employees with envelopes of cash. They haul Chipotle and Nordstrom bags containing thousands of dollars in $10 and $20 bills to supermarkets to buy money orders. When they are able to open bank accounts — often under false pretenses — many store money in Tupperware containers filled with air fresheners to mask the smell of marijuana.

The problem underscores the patchwork nature of federal and state laws. Though 20 states and D.C. allow medical or recreational marijuana, with more likely to follow, the drug remains illegal under federal law. Banks fear that federal regulators and law enforcement authorities might punish them, with measures like large fines, for violating prohibitions on money-laundering, among other federal laws and regulations. “Banking is the most urgent issue facing the legal cannabis industry today,” said Aaron Smith of the National Cannabis Industry Association. Saying legal U.S. marijuana sales could reach $3 billion this year, he added: “So much money floating around outside the banking system is not safe, and it is not in anyone's interest. Federal law needs to be harmonized with state laws.”

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