Creating Safety and Accountability with an Established Banking System for the Marijuana Industry

Budding Seedling

Imagine, if you will, the days when the American frontier was an open landscape that had yet to be colonized. It was a lawless land that was open for the taking by anyone who dared to venture away from the major cities in the name of prosperity, discovery and new opportunities. The term, “the wild west” has often been used to describe the frontier’s past when train robbers, cowboy gangs and malicious landowners forged their own path without the fear of federal repercussions. The cannabis industry continues to operate in a similar environment. But instead of a gold rush, we’re in the earliest days of the marijuana rush, a highly unregulated market in need of a structured business model.

Joe Frantz, a Texas historian and American West author, often wrote on the violence of the western frontier and how it’s still reflected on society in modern times. Despite claims from other historians that the West’s violence was over-exaggerated, Frantz wrote, “American violence today reflects our frontier heritage. Thus, an allegedly violent and stateless society of the nineteenth century is blamed at least for some of the violence in the United States today.” Much like the old west, businesses that operate in states like Oregon, Washington, California and Colorado are at risk, being targeted by violent criminals looking to rob lump sums of cash that marijuana business owners are forced to transport within the state.

In response to this dilemma, Oregon Senator Jeff Merkley and a bipartisan group of Senators (Cory Gardner, R-Colo., Michael Bennet, D-Colo., Rand Paul, R-Ky., Ron Wyden, D-Ore., and Patty Murray, D-Wash) introduced legislation to provide access to banking services for legal marijuana businesses. The Marijuana Business Access to Banking Act S. 1726 looks to open the financial market for marijuana businesses and provide them access to bank accounts, accept credit cards and write checks. It also creates a better option for local and state government to collect taxes.

Marijuana businesses operate under state laws where marijuana is legal (medical, recreational or both), but they’re denied any sort of banking system. The banks, by law, aren’t allowed to provide services to marijuana business because they can be federally prosecuted. This creates safety problems for producers, processors and retailers because they’re forced to operate using large amounts of cash.

Marijuana businesses have become targets for robberies, causing business owners to purchase expensive security equipment or contract armored services to perform transactions. According to Senator Ron Wyden, “By compelling Oregon business owners to operate on a cash-only basis, current federal laws are making marijuana businesses sitting ducks for violent crimes. It is ridiculous to make any business owner carry duffel bags of cash just to pay their taxes.”

The Colorado marijuana industry alone generated about $700 million in sales last year. Much of this money floats around, unregulated, unless business owners are using regulatory compliance software. Cash floats around with the proper accountability structure which gives criminals an opportunity to target their victims and enact potentially fatal robberies.

The Marijuana Business Access to Banking Act will also protect banks for providing services to the marijuana industry. It will prevent federal banking regulators from penalizing banks for providing financial services, terminating a bank’s federal deposit insurance for dealing with marijuana businesses, or taking any action on a loan given to a marijuana business owner. But until the bill passes, banks won’t change their policies and the industry will continue to be a dangerous playing field for the pioneers of tomorrow.


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Since 2010, BioTrack has provided the legal cannabis operators with the industries’ leading seed to sale tracking and dispensary point of sale software. Whether you operate a cultivation site, manufacturing and processing facility, medical or recreational dispensary or a business that covers the full vertical, we’ve got you covered when it comes to compliance.

Our extensive seed-to-sale software allows licensed operators to remain compliant while helping to identify key data points to streamline and optimize inventory management at each phase of the operation; cultivation, processing, destruction and waste, transportation, lab testing and dispensing.

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