Thursday, November 10, 2011

MMJ: So you think you can bank? State, city council hope so

Posted By on Thu, Nov 10, 2011 at 3:10 PM

CSMCC president Tanya Garduno

We brought you a little bit from Colorado Springs Medical Cannabis Council president Tanya Garduno in this week's CannaBiz, but there's more about the medical marijuana industry's perilous banking situation we were limited by space from sharing.

Like, that there's people who aren't as hard up for banking services as those in the Springs.

"The Denver banks have still not kicked people out — they won’t accept new people in but they’re still holding," Garduno says, declining to name the bank(s) for fear that media attention may endanger those accounts.

But if you're an MMJ center owner, and you're still not be-banked after the dumping by Colorado Springs State Bank, than you're probably doing things like working off of pre-paid cash cards, using money orders or maybe misrepresenting the use of your account.

"Some people are trying that, but the problem with that is, you know, we are trying to be as transparent as possible," says Garduno. "And we have seen situations where someone was using a private account that they had — a separate account from their private account — but their assets were frozen all together; because they say that it’s money laundering at that point, because the bank didn’t know what was happening.

"So you can attempt that, but you run a huge risk of your assets, not only being frozen, but seized altogether. And then if you try and do it through a personal account, they’ll seize your personal assets as well. So you run a huge risk trying to do that."

The issue's even drawn attention from Colorado Springs City Council President Scott Hente, who wrote a letter on Oct. 3 expressing support for banks to work with the MMJ industry.

"On a personal level, while I have serious philosophical issues with the medical cannabis industry, I do agree with the need for responsible banking and banking processes in order for these businesses to continue to function under Colorado State law," Hente writes. "General commercial checking is vital to maintaining compliance at all levels of government — I encourage the banking community to consider keeping existing accounts and/or opening accounts for those regulated businesses in need."

Dan Hartman, deposed director of the state Medical Marijuana Enforcement Division, also weighed in with support on Sept. 26.

After giving background on Colorado's many MMJ regulations, Hartman says, "As you can see, we are making every effort to standardize and legitimize this new industry by creating a robust regulatory scheme for all Medical Marijuana commercial businesses. However, the difficulty these business owners have in obtaining baking [sic] services not only stifles economic growth, it also handicaps our efforts to regulate these business [sic] and raises safety concerns due to the large amount of capitol [sic] it takes to run such a business."

In the meantime, the effort to regain banking services has taken every form, from efforts to start an industry credit union, to changing state and federal legislation.

"We’re even reaching out to Native American lands to see if they can open up a bank because they have different rules and regulations than the rest of the country," Garduno says with a frustrated laugh. "I mean, we’re reaching out to wherever we can and we’re looking for help wherever we can."

And if nothing changes?

"Well, the DOR’s going to have to come up with a new set of regulations on how we can manage an all-cash business and I know that they’re not happy about doing that," she says. "It’s going to have to be a new set of regulations that do all that.

"But it’s very, very difficult for us right now."

Hartman_letter.pdf Hente_letter.pdf

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