Last month the director of the Treasury Department's Financial Crimes Enforcement Network claimed marijuana businesses are finally gaining access to banking services thanks to guidance from officials in Washington. As University of Alabama law professor Julie Andersen Hill notes in a paper she delivered at a conference last week, that view is more than a little overoptimistic. In my latest Forbes column, I explain why Hill and other critics say the cannabis industry's banking problems can't be properly addressed without congressional legislation. Here is how the piece starts:
During a visit to the Dixie Elixirs & Edibles plant in Denver last summer, I saw the machines the company uses to produce cannabis concentrates, the kitchen where it makes marijuana-infused chocolates, and the bottling line for its THC-spiked sodas. Toward the end of the tour, I had a semi-serious question for the company's CEO, Tripp Keber: "Where do you keep your piles of money?"
Keber laughed but quickly turned serious. "We actually have strong banking relationships," he said. "We don't talk about them. Asking someone about their banking is like asking them what they wear to bed at night. It's an intensely personal question, even within the industry." You can begin to understand why banking is such a touchy subject for the newly legal cannabusinesses in Colorado and Washington (as well as growers and dispensaries in the 21 states that allow medical but not recreational use of marijuana) if you consider the federal laws a financial institution violates when it does business with a state-licensed company like Keber's.