Pubdate: Sat, 18 Oct 2014
Source: Seattle Times (WA)
Copyright: 2014 The Associated Press
Contact:  http://seattletimes.nwsource.com/
Details: http://www.mapinc.org/media/409
Author: Gene Johnson, the Associated Press
Page: B2

WASHINGTON PUTS POT SALES, FINES ONLINE FOR BANKS

Banks Need Updates to Rate Client Risk

2 of State's Top-Selling Shops Are in Vancouver

Banking remains a thorny issue for legal marijuana businesses, but 
regulators in Washington state are trying to make it easier for 
financial institutions to track their pot-related customers.

In the last few days, the state's Liquor Control Board has started 
posting the sales activity of licensed marijuana growers, sellers and 
processors online - along with any warnings or fines issued to 
businesses caught out of compliance. The data show that two of 
state's top-selling pot shops are in Vancouver, just across the 
Columbia River from Portland.

The idea behind posting the information online is to make it easy for 
banks or credit unions to discover red flags that might indicate 
illegal activity, officials said.

Early this year, the U.S. Justice and Treasury departments gave banks 
permission to do business with legal marijuana entities with 
conditions, including trying to make sure the customers are complying 
with regulations.

"The more information that's out there, it helps them know their 
customers and gives them an opportunity to identify behavior that's 
not what they thought it would be," Scott Jarvis, director of the 
state Department of Financial Institutions.

"If somebody reports that they're selling $10,000 a month, and all of 
a sudden the bank sees them depositing $40,000 a month, there's room 
for inquiry there."

Colorado, the only other state with legal marijuana sales, does not 
make such data available online.

Denny Eliason, a lobbyist for the state banking industry, said it can 
only help to have the information easily accessible because "the 
federal guidance requires financial institutions to know their 
customers at an unprecedented level."

While some credit unions in the state are opening accounts for pot 
businesses, he said it's too soon to say whether the online access 
will encourage more to take marijuana money.

"The sense I get from the financial industry is still one of 
caution," Eliason said. "There's so much risk."

The sales data show that since sales began in July, one of the 
state's top-selling pot shops has been New Vansterdam in Vancouver, 
which has reported nearly $1.7 million in sales. Another Vancouver 
shop, Main Street Marijuana, has sold about $1.1 million worth.

By contrast, Seattle's first licensed pot store, Cannabis City, which 
like many of the stores has been beset by supply problems, reported 
$1.3 million in sales.

Sales are allowed to out-of-state residents. But among the federal 
government's concerns in allowing states to move forward with 
legalizing marijuana is to prevent diversion to other states. Oregon 
is set to vote this fall on whether to legalize marijuana.

The enforcement data posted online so far concerns activity from last 
month only, but it reveals that the state has already issued fines to 
businesses. One licensed marijuana grower, Botany Unlimited Design 
and Supply in Pasco, was fined twice: $2,500 on Sept. 16 for having 
unauthorized product or unapproved storage, and $1,000 on Sept. 25 
for failing to maintain a required security alarm or surveillance system.

Liquor-board spokesman Brian Smith said Botany Unlimited is scheduled 
for an informal hearing about the fines next month. The company 
declined to comment when contacted by The Associated Press.

Another licensed grower, Green Chiefs of Granite Falls, was fined 
$5,000 for failing to use or maintain systems designed to track its 
marijuana. Green Chiefs hasn't informed the board about whether it 
wants to seek a hearing over the matter, Smith said. The company did 
not return phone messages.

Two other companies were issued fines that were not reflected in the 
September data, Smith said. After hearings, Green Apple, a licensed 
grower in Silverdale, was fined $1,600, and BMF Washington, a grower 
in Raymond, was fined $3,000. The reasons for those fines were not 
immediately clear.
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MAP posted-by: Jay Bergstrom