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  1. ZenobiaSky
    Colorado lawmakers approved the world's first financial system for the marijuana industry Wednesday, a network of uninsured cooperatives designed to give pot businesses a way to access basic banking services.

    The plan seeks to move the marijuana industry away from its cash-only roots. Banks routinely reject pot businesses for even basic services such as checking accounts because they fear running afoul of federal law, which considers marijuana and its proceeds illegal.

    The result: Pot shop owners deal in large amounts of cash, which makes them targets for criminals. Or they try to find ways around the problem, like drenching their proceeds in air freshener to remove the stink of marijuana and try to fool traditional banks into accepting their money.

    "This is our main problem: Financial services for marijuana businesses," said Sen. David Balmer, R-Centennial. "We are trying to improvise and come up with something in Colorado to give marijuana business some opportunity, so they do not have to store large amounts of cash."

    Colorado became the first state to allow recreational pot sales, which started Jan. 1. Washington state will follow suit, with retail sales expect to start in July.

    The U.S. Treasury Department said in February that banks could serve the marijuana industry under certain conditions. With the industry emerging from the underground, states want to track marijuana sales and collect taxes. It's a lot easier to do that when the businesses have bank accounts.

    But most banks have shrugged at the Treasury guidelines, calling them too onerous to accept marijuana-related clients. The result is a marijuana industry that still relies largely on cash, a safety risk for operators and a concern for Colorado's pot regulators.

    "This is not something that we can wait for any further," said another banking sponsor, Rep. Jonathan Singer, D-Longmont.

    The bill approved Wednesday would allow marijuana businesses to pool money in cooperative s, but the co-ops would on take effect if the U.S. Federal Reserve agrees to allow them to do things like accept credit cards or checks.

    Democratic Gov. John Hickenlooper supports the pot bank plan and is expected to sign it into law, though a spokesman said Wednesday the governor had yet to review the final language.

    Lawmakers from both parties supported the banking co-ops as a way to properly audit marijuana shops and to make sure they're paying all their taxes. Dispensary owners came to the Capitol this session to tell of their difficulties paying taxes and utilities in cash and the dangers of dealing in cash.

    "It is very easy to see somebody get killed over this issue," Marijuana Industry Group Director Michael Elliott testified last month.

    The plan had bipartisan support, though some Republicans said that the effort won't pass federal muster.

    A few banks are accepting marijuana clients in light of the federal regulations.

    Numerica Credit Union in eastern Washington state is accepting limited business from marijuana growers and processors, The Spokesman-Review reported Wednesday.

    Colorado pot shop owners say a small number of credit unions will do business with them, too, though no banks or credit unions have said so publicly.

    Countries that don't ban marijuana don't have banking systems unique to the drug.

    KRISTEN WYATT
    AP
    Posted: 05/07/2014 8:11 pm EDT Updated: 05/07/2014 9:59 pm EDT
    Huffington Post
    http://www.huffingtonpost.com/2014/05/07/colorado-marijuana-banking_n_5284442.html

    The Newhawks Crew

Comments

  1. BitterSweet
    Colorado Paves Way For New Pot Banking System

    [IMGL="BLACK"]http://www.drugs-forum.com/forum/picture.php?albumid=3238&pictureid=30781[/IMGL]As they did with legalizing recreational weed, Colorado is leading the way in making financial services marijuana friendly.

    On Wednesday, Colorado lawmakers approved the first financial system for marijuana businesses that is designed to allow the industry to take advantage of basic banking services. The call for such a system has grown since the retail sale of marijuana became legal on January 1, since pot retailers have only been able to operate as cash-only businesses.

    "We are trying to improvise and come up with something in Colorado to give marijuana business some opportunity, so they do not have to store large amounts of cash,” said state Sen. David Balmer (R-Centennial).

    The bill will form a network of cooperatives that will allow pot businesses to pool their money in order to receive banking services. Under the new financial system, banks will no longer have to fear federal prosecution for doing business with the marijuana industry and pot businesses no longer have to fear being robbed for holding large sums of cash.

    Despite the step forward, the new system is contingent upon the U.S. Federal Reserve allowing the co-ops to accept checks and credit cards for transactions.

    "This is not something that we can wait for any further," said sponsor Rep. Jonathan Singer (D-Longmont).

    In January, Attorney General Eric Holder opened the way for new regulations that would allow banks to do business with the pot industry, echoing the concerns of retailers and Colorado lawmakers. "You don't want just huge amounts of cash in these places," Holder said. "They want to be able to use the banking system. And so we will be issuing some regulations I think very soon to deal with that issue."

    But the banks blanched at Holder’s proposed guidelines, leaving Colorado retailers holding onto their bags of cash. "It is very easy to see somebody get killed over this issue," said Marijuana Industry Group Director Michael Elliott to lawmakers last month.

    Meanwhile, Gov. John Hickenlooper is expected to sign the legislation pending a review of the bill’s language.

    Author: Shawn Dwyer
    Date: May 9, 2014
    http://www.thefix.com/content/colorado-paves-way-new-pot-banking-system
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