Pubdate: Sat, 10 May 2014
Source: Las Vegas Review-Journal (NV)
Copyright: 2014 Las Vegas Review-Journal
Website: http://www.lvrj.com/
Details: http://www.mapinc.org/media/233
Author: David Ferrara
Page: 1A

LEGAL POT GROWS OTHER BUSINESSES

Security, Software, Cash-Payment Kiosks Just Some of the Byproducts of
Marijuana Sales

Lenny Davis spent much of his 31year career in law enforcement busting
down doors to confiscate illicit marijuana and piles of drug money.
Some of the dealers he locked up are still in prison.

Phil Gervasi busted drug dealers as an officer with the New York City
Police Department, and spent 17 years with the Clark County School
District police.

These days, Davis and Gervasi are part of security companies competing
for deals with dozens of Clark County medical marijuana businesses.

Las Vegas-based Unity One Inc., for which Gervasi is director of
community services, struck nondisclosure agreements with more than 20
medical marijuana business applicants in Clark County.

Davis, an owner of Team Phoenix Security, said he has letters of
intent from at least eight applicants.

Both companies are staffed with former law enforcement officers,
federal agents and military personnel.

"It is kind of like we're going to the other side, but it is a legal
business, and we do have the knowledge training and expertise to
mitigate many of the risks," said Davis, who led a government seizure
of 985 pounds of pot in Las Vegas 15 years ago. "I've had a couple
soul-searching days, but at the end of the day, I'm also a
businessman."

So far, 109 companies are vying for at least 40 medical marijuana
business licenses in Clark County. The successful applicants will
operate dispensaries where the drug is sold, production plants,
cultivation warehouses and a testing lab.

Across the country, financial institutions are turning away marijuana
companies because marijuana remains illegal under federal law. That
means pot business owners must find ways to protect their cash, along
with the product.

Unity One would stress "boots on the ground" enforcement, with
officers on site 24 hours a day, Gervasi said.

"We don't dial 911 and wait for local law enforcement," he said.
"We're just starting in the (marijuana) business, but we know security
from top to bottom."

Should the federal government crack down on medical marijuana
companies, Davis said, "we would divest ourselves completely of these
kinds of operations."

JUST ONE OF THE ANCILLARY BUSINESSES

Security teams are part of a rush of ancillary businesses expected to
crop up in Nevada with the legalization of medical marijuana
dispensaries.

This year, the Treasury and Justice departments set strict guidelines
for financial institutions accepting money from pot companies in
states where the business is legal. Banks must review state license
applications and look for red flags that could reveal illicit
activity, as well as file "suspicious activity reports" for
questionable transactions from marijuana clients.

Cash-payment kiosks that track and record each transaction could help
eliminate those questions for banks.

Mark Goldfogel, CEO of Denver-based C4Ever Systems, which designs
cannabis kiosks, expects Southern Nevada dispensaries to embrace the
technology.

The support system for C4Ever is based in Las Vegas, and Goldfogel
anticipates planting more kiosks in Nevada than any other state with
legalized marijuana. He compared the technology to slot machines that
keep dollars locked in the terminals.

"Of every state in the union, Nevada understands how to secure cash
better than any ..." he said.

The technology is simple: A customer selects a product, places the
order and pays at the kiosk, receives a receipt and picks up the drug
from a "bud tender" at the dispensary.

The kiosk provides a sales report, and cameras capture the patient who
buys the drug.

In March, Goldfogel's company partnered with Kansas City, Mo.-based
Agrisoft Development Group LLC, which specializes in software for
medical and recreational cannabis businesses.

"Other solutions have to be in place for these business owners because
they have to deal in cash," Lisa Stewart, an Agrisoft spokeswoman,
said referring to reluctance from banks. "At least, in the workplace,
they can have everything secure."

Agrisoft is in talks with Clark County medical marijuana applicants,
and the company is ensuring the software complies with Nevada law.
Argisoft and C4Ever hope to make kiosks available in the state as soon
as marijuana business licenses are awarded, according to Stewart.

Goldfogel provides dispensaries the kiosks and maintenance and charges
a 1.75 percent transaction fee for all the money processed. He
guarantees to modify the kiosks to meet future federal guidelines.

"I'm selling this to dispensaries, but really I'm building this for
banks," he said. "I'm not selling a tool. I'm selling a solution."

ECONOMIC IMPACT IN THE MILLIONS

As dispensaries and cultivation warehouses start to open across the
valley later this year, the pot industry is expected to attract
millions of dollars and create thousands of new jobs.

State Sen. Tick Segerblom, D-Las Vegas, who authored the 2013 bill to
legalize dispensaries in Nevada, envisions progress in medical
marijuana research, a push for solar-powered grow facilities, and more
cannabis-related businesses moving to Nevada because of its corporate
tax structure.

"You can already feel the positive impact it's had, and it's only
going to grow," he said.

Joe Brezny, executive director of the Nevada Cannabis Industry
Association, said the Las Vegas tourism industry and the marijuana
business are a good fit.

He imagines independently owned hotels near dispensaries marketing to
medical marijuana patients, offering menus and delivery options, and
allowing them to consume the drug at the hotels.

"That's a concern for tourists," said Brezny, who is pushing for
outright pot legalization. "Are they going to get in trouble with
their hotel or have problems with consumption?"

Meanwhile, Davis and Gervasi want medical marijuana business owners
surrounded by piles of cash and cannabis to feel as safe as a patient
toking up at home.

"This marijuana is for the patients, and if you don't have a marijuana
card, you shouldn't be there," Gervasi said. "We don't want to have
any problems inside these establishments. I don't decide who gets the
medical marijuana card, but I will decide who goes inside."
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