Pubdate: Wed, 17 Jul 2013
Source: Fort Collins Coloradoan (CO)
Copyright: 2013 The Fort Collins Coloradoan
Contact: http://www.coloradoan.com/customerservice/contactus.html
Website: http://www.coloradoan.com/
Details: http://www.mapinc.org/media/1580
Author: Pat Ferrier

BILL MIGHT HELP POT SHOP BANKING WOES

Although a Proposal by U.S. Rep. Ed Perlmutter Would Protect Banks 
 From Federal Prosecution, Some Might Still Refuse to Do Business 
With Marijuana Shops.

When Donald Cruickshank opened his medical marijuana dispensary a 
couple of years ago, he had no trouble finding a bank to take his money.

But when the federal government threatened to prosecute the bank for 
doing business with a pot shop, the bank quickly dropped 
Cruickshank's account. Two other banks followed suit. That meant 
Cruickshank, co-owner of A Kind Place, had to operate almost entirely in cash.

Now, seven months after Colorado voters legalized recreational 
marijuana use and Fort Collins voters lifted a citywide ban on their 
businesses, dispensary owners are finding financial services 
difficult to obtain as they prepare to reopen.

U.S. Rep. Ed Perlmutter wants to change that.

The Democrat from Golden recently introduced in Congress the 
Marijuana Business Access to Banking Act that would protect banks 
doing business with marijuana dispensaries from federal prosecution.

Providing banking services to dispensaries is prohibited under 
federal law, which still considers marijuana an illegal substance.

"This is not about whether you agree or disagree or support the use 
of marijuana," said Leslie Oliver, Perlmutter's communications 
director. "It's about ensuring public safety and that businesses that 
are legal can do what other legal businesses can do."

Nineteen states allow medical marijuana use, but only Colorado and 
Washington have legalized recreational marijuana use for those older 
than age 21. That has led to broad support for Perlmutter's bill 
across the country, Oliver said. "We're hopeful we can pick up more 
support as we begin educating (House) members about the purpose and 
the goal" of the bill.

Operating an all-cash business puts dispensary owners, employees and 
customers at risk of robbery, theft and assault, Oliver said.

The bill helps prevent crime and helps cities that tax marijuana 
sales track the money, she said. "The benefits run pretty deep. It's 
not the be-all, end-all solution, but it would alleviate some of the 
conflict between federal and state law."

The act has the full support of the Colorado Bankers Association, 
which helped draft the bill's language.

"While many opposed Amendment 64, the Colorado Bankers Association 
believes the state cannot tax or regulate a business for which it 
can't follow the money. ... This bill is a tailored, rational 
approach to address this issue," said CBA President and CEO Don 
Childears in an email to the Coloradoan.

Not all dispensary owners have had a tough time finding local banking 
services, although they pay hefty fees, said Dave Watson, owner of 
Kind Care of Colorado, which expects to reopen in Fort Collins by the 
end of the month.

Like Cruickshank, Watson had an account at one local bank that shut 
him off when federal bank regulators discovered the practice.

He found another local bank that welcomed him but charges a $250 
monthly fee and 20 cents for every hundred dollars he deposits in 
cash, he said.

"It's not cheap to go to a bank for our industry," he said. But it 
gives him peace of mind to know there's not a lot of cash sitting 
around the business.

"It would be nice to get equal treatment like other businesses," 
Watson said. "It's pretty frustrating the way they treat us, the fees 
. we're just having to jump through a ton more hoops than other 
businesses would."

Even if Perlmutter's bill passes Congress, pot shops might not find 
many friendly bankers waiting at the front door.

Kelso Kelly, president and CEO of Capital West Bank in Fort Collins 
and Laramie, Wyo., said the bill wouldn't change his bank's position. 
"When part of your reputation is founded on the public trust, things 
that are kind of on the fringe in our society, we tend to not be on 
the leading edge of jumping in."

But if the bill passes and all goes well, Kelly said the bank might 
consider doing business with pot shops down the road.

Mark Driscoll, president of First National Bank of Fort Collins, 
doubted his bank would change its approach. "The reason we don't is 
because we can't, it's cut and dry," said Driscoll, an outspoken 
critic of marijuana dispensaries.

"I guess it would make it a business decision rather than regulatory 
decision if we wanted to be in that business."

Verus Bank of Commerce Chairman Gerard Nalezny said any law that 
provides clarity for banks would be helpful.

"It's difficult to navigate where on one level you're legal and one 
level you're not," he said. "Any clarification in any direction would 
be helpful. It's too bad because it forces it underground, which is 
probably not what you want."
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MAP posted-by: Jay Bergstrom