Pubdate: Tue, 21 Jul 2015
Source: Citizens' Voice, The (Wilkes-Barre, PA)
Copyright: 2015 The Citizens' Voice
Contact:  http://www.citizensvoice.com/
Details: http://www.mapinc.org/media/1334
Author: Rob Hotakainen, Tribune News Service

POT INDUSTRY PUSHES FOR BANK ACCESS

Law Prohibits Businesses From Accepting Checks, Credit Cards, So They 
Deal Only in Cash

At the Cannabis Club Collective in Tacoma, Washington, Brian Caldwell 
has installed a top-of-the-line alarm system, motion sensors and a 
safe, hoping to protect the cash he collects from the 200-plus 
customers who buy marijuana at his store on an average day.

"We pretty much had to make a bank within our walls," he said.

And at Auntie Dolores, a marijuana edibles shop in Oakland, Calif., 
Julianna Carella uses pouches to bag her cash at the end of the day, 
then sticks it in her trunk, feeling nervous as she drives away.

"It's actually a huge headache to have to deal with all that cash," 
she said. "It's horrible."

While voters in a growing number of states have embraced marijuana in 
recent years, federal law still prevents pot businesses from using 
checks and credit cards offered by banks. That means that by law, 
they can deal only in cash.

Reviving a fight that stalled last year, the all-cash establishments 
and their allies in Congress are pushing hard again to change the 
law, convinced that marijuana shops have become inviting targets for thieves.

"Quite literally, you have accountants stuff $ 50,000 worth of cash 
in their backpack and walk it to a depository," said Rep. Denny Heck, 
D- Wash., a member of the House Financial Services Committee. "This 
is a recipe for mischief if we don't solve it."

There's a new twist in this year's debate, with some in the cannabis 
industry suggesting that foreign banks or American Indian-owned 
financial institutions could serve as alternative depositories if 
Congress doesn't provide a fix.

Many say the situation is bound to worsen as marijuana grows in 
popularity and markets expand.

So far, voters in Washington, Colorado, Oregon and Alaska have 
approved the use of marijuana for recreational purposes, while 23 
states allow it for medical reasons.

And California voters, who in 1996 made the Golden State the first to 
back medical marijuana, are expected to decide a ballot initiative on 
recreational pot in 2016.

"You're talking about cash businesses that are in the hundreds of 
millions and approaching billions of dollars in state markets," said 
Leslie Bocskor, founder of Electrum Partners, a marijuana consulting 
firm in Las Vegas. "And that's just frightening from a community's 
safety perspective."

The issue is gaining some traction on Capitol Hill. Last week, seven 
senators and presidential candidate Rand Paul, R- Ky., introduced a 
bill that would allow state-sanctioned marijuana businesses to use 
banking services without prosecution.

Mr. Paul has been busy courting legalization backers as part of his 
presidential campaign.

Mr. Bocskor said many investors are eager to capitalize on marijuana 
companies if they can be made confident that their investments will be safe.

His company is exploring alternatives, including the use of foreign 
banks - he noted, for example, that pot establishments in the 
marijuana haven of Amsterdam already accept credit cards.

And he said it's possible that outside firms could sign agreements to 
operate banks on Indian reservations, taking advantage of their 
tribal sovereignty.

"We believe there are advantages in it," said Mr. Bocskor. "We would 
like to see Native Americans be able to use banking as another method 
to bring a little more economic development to the tribal lands. That 
can happen, but it's a pretty heavy lift."
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MAP posted-by: Jay Bergstrom