Will Florida Marijuana Businesses Be Able to Find Banks to Handle Their Accounts?

By: Nancy Smith | Posted: April 16, 2014 3:55 AM
Marijuana business in Colorado

Marijuana business in Colorado

One seldom-discussed pothole along the road to marijuana legalization in Florida is the reluctance of banks to have anything to do with businesses that deal in the plant.

Never mind that the Obama administration issued guidelines in February intended to give banks confidence they won't be punished if they provide services to legitimate marijuana businesses in the 20 states that have legalized use of the drug. For the most part, wary financial institutions aren't buying it.

That's likely to be the case in Florida, too -- if voters approve the marijuana amendment on the November ballot, and perhaps even if the Legislature passes the Charlotte's Web medical marijuana bill.

Drew J. Breakspear

Drew J. Breakspear

Drew J. Breakspear, commissioner of the Florida Office of Financial Regulation, told Sunshine State News, “This is an evolving issue, and as it currently stands, I do not believe that the federal government has issued sufficient guidance and/or regulation to help Florida’s financial institutions feel comfortable if they are faced with these situations.”

What the reluctance of banks means is, marijuana-related businesses will be holding -- or hiding -- a great deal of cash, depending on their success. They may not be able to find an FDIC safe harbor where they can open an account or apply for a loan. It's a considerable safety concern for vendors and law enforcement alike.

Consider Colorado: More than 90 percent of Colorado's cannabis stores are located in and around the Denver area, where shop owners estimated they collectively sold $1 million of product within the 24 hours of Jan. 1 -- first day recreational-use marijuana came available. Retail buyers are charged a 10 percent tax for every sale and a 15 percent excise tax which varies based on the average market rate. Colorado will put the first $40 million in taxes toward its school system, with any tax dollars after that dedicated to regulations.

Such largesse for the state understandably angers marijuana business owners, who are virtually prohibited from putting their profits in the bank -– making it difficult for them to know exactly how much they've earned.

The Obama administration's guidance, which requires banks to vigorously monitor their marijuana-industry customers, actually came from the Treasury Department and the Justice Department in separate advisories. The policy doesn't grant immunity from prosecution or civil penalties to banks that serve legal marijuana businesses. But it does say prosecutors and regulators must give priority to cases only where financial institutions have failed to follow the guidance.

That's not enough assurance for bankers, who generally don't take kindly to rolling the dice in uncharted territory.

Frank Keating

Frank Keating

Frank Keating, president of the American Bankers Association, echoed Florida's Breakspear in a statement referring to the Financial Crimes Enforcement Network, the Treasury unit that issued part of the guidelines: “While we appreciate the efforts by the Department of Justice and FinCEN, guidance or regulation doesn’t alter the underlying challenge for banks,” Keating said. “As it stands, possession or distribution of marijuana violates federal law, and banks that provide support for those activities face the risk of prosecution and assorted sanctions.”

Of eight bank presidents contacted by Sunshine State News in six Florida counties, none would go on the record, three declined comment altogether and five said they wouldn't even hold a conversation with a marijuana businessman until federal law is changed to legalize marijuana.

In Colorado, most businesses with banks keep the name of their institution close to the chest. "They're too afraid of spooking their bank," said Helen Richland, a Denver pot shop owner.

In a telephone interview, Richland said, "It's been so hard to find a bank that will take me on. I've had to change banks three times since January. The first account I had was closed because I wasn't upfront about the product I was selling and they found out. The second bank closed my account because within a month they just got cold feet and wanted me out. So, no way am I going to tell you or anybody else who bank No. 3 is."

Added to banks' fears of prosecution is the significant paperwork involved in maintaining accounts for marijuana-business clients. On an ongoing basis, bankers must file "suspicious activity reports" that either identify those businesses as legal and unlikely to be a problem for federal drug investigators, or as possible troublemakers.

"It's unusual and cruelly ironic to have an industry that's being denied basic banking services, then threatened with the loss of those services if they share that they have it," said Taylor West, deputy director of the National Cannabis Industry Association in Washington, D.C.

Eric Holder

Attorney General Eric Holder

U.S. Attorney General Eric Holder has publicly acknowledged that having so much cash on hand presents a public safety problem for legal marijuana businesses, and he even said they should have access to the country’s banking system.

Nevertheless, marijuana remains a Schedule 1 drug -- along with heroin, LSD and Ecstasy -- under the Controlled Substances Act. In mid-February 18 members of Congress, in a joint letter to President Obama, asked him to instruct Holder to remove marijuana from any of the drug schedules or to reschedule it to a lower category. The president has not responded.

Meanwhile, Michael Elliott, executive director of the Medical Marijuana Industry Group in Colorado, reminds Florida and all states involved in trying to alleviate patients' suffering with even light-strain cannabis, that the federal promise to hold harmless in the administration's guidelines will not solve all problems.

“We need to go beyond saying that this is a low law enforcement priority," says Elliott. "There are still violations of federal law going on here. So, federal laws need to be changed to ensure that what is legal in states like Colorado is legal at the federal level, as well."

Reach Nancy Smith at nsmith@sunshinestatenews or at 228-282-2423. 

Comments (23)

1:44AM JAN 9TH 2015
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10:06PM MAY 6TH 2014
No they will not get banking until the schedule changes,,,,,if approved it will be cash until then,,,,,,,if approve you Watch!
Watch all the hipocracy of the same people grinding the citizenry over the god awful demon weed,,,judges,,,police capts,lawyer,,politicians ,,,the same juiced people who have made the lives of fellow Americans miserable,,,all of a sudden want to control the market for thems selves,,,it's not about liberty,,,it's about money and greed,,,,,,,take it out of the hands of gov ,,,let the people grow,,and move on to next prob
10:04PM MAY 6TH 2014
No they will not get banking until the schedule changes,,,,,if approved it will be cash until then,,,,,,,if approve you Watch!
Watch all the hipocracy of the same people grinding the citizenry over the god awful demon weed,,,judges,,,police capts,lawyer,,politicians ,,,the same juiced people who have made the lives of fellow Americans miserable,,,all of a sudden want to control the market for thems selves,,,it's not about liberty,,,it's about money and greed,,,,,,,take it out of the hands of gov ,,,let the people grow,,and move on to next prob
Banks have no problem with drug money It's all green!
10:42AM APR 17TH 2014
Ties to drug money are nothing new to the Rothschilds. N. M. Rothschild & Sons was at the epicenter of the Bank of Credit & Commerce International (BCCI) scandal, but escaped the limelight when a warehouse full of documents conveniently burned to the ground around the time Rothschild-controlled Bank of England shut BCCI down. (Walker- Bush family involved as well)

Today the Rothschild’s control a far-flung financial empire, which includes majority stakes in most world central banks. The Edmond de Rothschild clan owns the Banque Privee SA in Lugano, Switzerland and the Rothschild Bank AG of Zurich. The family of Jacob Lord Rothschild owns the powerful Rothschild Italia in Milan. They are founding members of the exclusive $10 trillion Club of the Isles – which controls corporate giants Royal Dutch Shell, Imperial Chemical Industries, Lloyds of London, Unilever, Barclays, Lonrho, RioTinto Zinc, BHP Billiton and Anglo American DeBeers. It dominates the world supply of petroleum, gold, diamonds, and many other vital raw materials.

The Club of the Isles provides capital for George Soros’ Quantum Fund NV – which made a killing in 1998-99 destroying the currencies of Thailand, Indonesia and Russia. “Soros was a major shareholder at George W. Bush’s Harken Energy” and fellow Council on Foreign Relations (CFR) member with George Herbert Walker Bush. Quantum NV operates from the Dutch island of Curacao, in the shadow of recently shuttered Royal Dutch/Shell and Exxon Mobil refineries. Curacao was recently cited by an OECD Task Force on Money Laundering as a major drug money laundering nation. The Club of Isles is led by the Rothschilds and includes Queen Elizabeth II and other wealthy European aristocrats and Black Nobility. Fugitive Swiss financier and Mossad cutout Marc Rich, whose business interests were recently taken over by the Russian mafia Alfa Group, is also part of the Soros network.

Recent Rothschild endeavors include the backing of Russian oligarch Mikhail Khodorkovsky, control over Blackstone Group (see “…The 911 Short Selling Financial Scam”),and the takeover of giant Swiss oil trader Glencore.
5:21PM APR 17TH 2014
Yes, the very ultra-wealthy (regardless of whether they are named Rothschild or not) have far too much power and influence. I wonder why that is, considering that the rest of us outnumber them by something like 8 billion to one?
Steven Norton
10:43PM APR 16TH 2014
Since the current information available indicates that marijuana is no more dangerous than alchohol, and has some proven medical benefits; we should be approving its use in Florida. But for Florida this would also be a great new attraction for the state, giving it a leg up on other parts of the US, that depend on tourism. I have been strongly behing the effort to legalise resort casinos, as a way to add new visitors to the State. Well pot would also be a major attraction, although not producing the jobs or construction. But the tax potential could be enormous, if it was legal for social use, like Colorado. Florida usually votes conservative. I can't wait until November, to see the outcome.
8:18PM APR 17TH 2014
Two recent news items indicate marijuana is not as “safe” as some would like to believe. In the first case, a man jumped off a motel balcony, in the second case, a man shot his wife in the head; (both after consuming a marijuana cookie). In neither case was marijuana the direct cause of death, but in both cases, a death resulted from a psychotic episode brought on by oral consumption of the drug. Again, I still support legalization/decriminalization of marijuana; but I’m suggesting that first-time users check into a hospital (seriously) in case they are among the minority that have an extreme adverse reaction (or a “bad trip” as they used to say in the ‘60’s).
Dean Franklin
11:06PM APR 17TH 2014
I hate to admit I had not heard of either of these. A few questions. What else had the people that died taken? Betting on a drink or two. That changes the whole situation, always for the worse. The "bad trip" you are talking about whas to do with LSD 25, and to the best of my knowledge been used to refer to a marijuana OD. Which almost only happenes when eating marijuana. Yes, the srore or pharmacy should have explained the proper use and possible outcomes of over use. I am sorry to hear this, although, I would ask, how many died of other drug and alcohol overuse durin the same time frame. I see it as a case of failure to educate the user. Something we can make a real effort to do here in FL when the time comes. Thank you for your information, and your continued support. I do ask that everybody vote YES on Amendment 2 to legalize medical marijuan in Florida. Thank You
8:01PM APR 16TH 2014
I still support legalization/decriminalization of marijuana. However, if it becomes legal, please be aware, if you decide to try it for the first time in oral form (i.e. cookie, brownie) there are two recent news items from Colorado that suggest you should use caution (if you have never consumed it before) as unexpected side-effects [i.e. death] may result.
9:18PM APR 16TH 2014
I just cannot let that lefthanded statement stand. There has NEVER been a report of a death by marijuana overdose. Could it m a y b e happen? Only with contributing factors, and I could not even hazzard a guess as to what those would have to be. Can a new user overdose? Yes, especially ingesting marijuana without instruction and a bit of common sense. When ingested the effects are slow to register and thus can lead to eating too much. At which time you will find yourself really "stoned" and maybe confused. If you then find a safe place and recline and relax, stay calm, you will recover in a period of time, based on the amount over-ingested. Nobody dies from the effect, although a person not expecting the effects may panic and think "Oh My God I am going to die" Which is nonsense. A bit of common sense, starting with small amounts and waiting to see the effects will not result in overdose. The patient should have had that explained when they purchased the product. On the other hand, the effects of smoking are quick and easier regulated by the user. As with any drug, different therapies will work best for each patient. Please give patients the choice and Vote YES on Amendment 2. Thanx
Gene Ralno
1:11PM APR 16TH 2014
Now that the vaunted Harvard University has issued its scientific study, I predict that conservative states may decriminalize pot but they'll never legalize it. It'll be interesting to see which liberal states back away from legalization and rewrite their laws to decriminalize instead.
3:18PM APR 16TH 2014
It was a very small study. 40 under 26 year olds with self reporting and no comparison to the effects of other chemicals, like booze, tobacco and highly addictive drugs like coke or meth. Anyone who makes deductions based only on this study is doing so because it supports what they already want to believe. Even the Scientists involved say more and wider study is needed before any deductions can be made.
12:51PM APR 16TH 2014
I would think that's not a hurdle that can't be overcome. Although we won't get any support from Senator Rubio on it.

An e-mail from Sen. Rubio:
"Thank you for contacting me regarding marijuana usage. I understand this is an important issue to you and I appreciate hearing your thoughts. Up front, let me say we disagree.

The use of illegal drugs has a profound impact on many people in our country, especially children. Drugs contribute to violent crime and enrich international crime organizations. More than that, they destroy lives and undermine our society. The federal government has an important role to play in combatting drug trafficking and the criminal organizations that benefit from it.

H.R. 499 the "Ending Federal Marijuana Prohibition Act of 2013", was introduced by Congressman Jared Polis of Colorado. This legislation seeks to remove marijuana from the list of Schedule I controlled substances. H.R. 499 has been referred to the House Subcommittee on Conservation, Energy, and Forestry. There is no companion legislation for H.R. 2306 in the Senate. I cannot support blanket legalization for marijuana and I would like to see more scientific research and data before changing the laws on medicinal marijuana.

It is an honor and a privilege to serve you as your United States Senator. I appreciate you offering your opinion on this issue. If I can ever be of any assistance to you in the future, please do not hesitate to contact me.
Marco Rubio
United States Senator
just in case
10:33AM APR 17TH 2014
This Rubio response would surprise no one who has kept up with the lineage of the Bush machine. Talk out of both sides of your mouth when at all possible - only admit the truth to small groups when absolutely necessary - always leave wiggle room to slide out of tight places....

It's all Karl Rove[r] Aggressive-Ccompassionate Republican training class 101.

Was Rubio's parents American Citizen's when he was born in Miami? NO! Therefore even though the establishment covered for their man Obama who himself stated in writing he was born in Kenya and therefore does not meet the requirements of being "a natural born American citizen" two wrongs do not make a right! Rubio and Ted Cruz (Canadian born of Cuban parents) are not qualified by the US Constitution to run for president let alone be elected!
9:31AM APR 16TH 2014
I can see it now! The Democrats new campaign slogan. They are already giving food Stamps, perpetual unemployment benefits, forgiving mortgages. So that covers food, income and shelter, now in 20 States, the new slogan will be: "We will give you 3 hots and a cot, your flop, and your "POT!!!" It will be very appealing to many!!
11:37AM APR 16TH 2014
Who's giving away anything? MM is on the ballot here in Florida for people who are sick and have a doctors excuse. MM is for patients that are in need of this medicine. Okay with you that pharmaceuticals are not working and are even killing people.
10:21AM APR 16TH 2014
Now that is really uninformed and insulting. Every poll shows 70-80% approval, thus not just democrats, but also a significant percentage of Republicans and Libatarians support the issue of Medical Marijuana. In fact, your rude comment follows with the partisan politics that has controlled the conversation until recently. Politicians have no right to declare what a Doctor can and cannot perscribe to a patient. I hope you will do a bit of thinking and research on the subject and consider it from the view that Doctors and Patients should be free to consider any drug therapy that may work for that Patient. Thanx
8:29AM APR 16TH 2014
Fortunately we here in Florida have a year until the Medical Marijuana Amendment can become law. That will give the state and the feds a chance to work out some of the problems. Despite sadly ill-informed folks like Bernard I believe that most Floridians will Vote YES on 2 and pass Medical Marijuana into law. Bernard, you are sadly WRONG! Marijuana is not toxic, or anywhere near as dangerous as many perscription medications. Nobody dies from Marijuana, while people die everyday from opiates. If we also consider the damage done everyday by legal tobacco and booze, Marijuana does not do near as much damage as those. It is a natural plant and does not deserve the bad reputation that it has been given by the uninformed. Please Vote YES on Amendment 2. Thank you
Bernard Long
7:37AM APR 16TH 2014
Pot is toxic, causing brain damage. Why are we considering making it legal? Why aren't you on top of this?
11:23AM APR 16TH 2014
Last night on Kelly, both Megyn and Brit Hume discussed this saying Harvard and northwestern University found that using marijuana caused excessive brain damage. We laughed till we cried hearing Hume spit and sputter about this new found marijuana reefer madness II statement. Lets go back just a few years till the 60's. 100's of millions of people around the World have tried or smoked marijuana since then and now we can assume everyone who has ever used marijuana has brain damage. Great news for Obamacare cause we now know that brain surgery is number one of all surgery's. This so called new found brain damage is only found for marijuana and excludes cigarettes and alcohol. What about salt and other spices? When you fill up your car with gasoline or diesel, ever breath the fumes? Let's take California that has legal MM since 1996, we are suppose to believe all these MM patients are now brain diseased? Megyn and Brit also said smoking marijuana yet nothing about MM food products or just eating MM. This is so over the top. The records show zero people have died from marijuana. How many people die each year from auto accidents? maybe it's time to reconsider personal owner ship of automobiles and everone use public transportation, Ha Ha Ha Ha Ha, that makes no sense either. Vote yes on amendment 2 this November, that is if you still have a brain. Ha Ha Ha Ha Ha.
9:44AM APR 16TH 2014
Dean, I see you have a fan!!! I guess he "inhaled!!!" (lol) I don't know, I just read the other day that a serious study concluded that using Pot twice per week cause serious brain impairment. And the jury is still out on how smoking pot effects your lungs, but I suspect it can't be a good effect. But once you let the "Cat out of the bag" which is actually a British Naval phrase, When the Master at Arms carried a Cat-o-nine tails in a velvet bag, and when a seaman did something bad, he would say: "Now you let the Cat out of the bag!!!" I fear that is what we may be getting ready to do here, Letting the Cat out of the Bag!
12:43PM APR 16TH 2014
If your concern about legalizing marijuana is for a person's health, you would do more good for society to advocate for comparative effectiveness studies on pharmaceutical drugs and medical procedures.

Make sure to ask to include marijuana, herbs, supplements and other natural and alternative medicine in their comparisons. That not only has the potential to save thousands of lives, but improve the quality of life of countless others.

BTW, I would bet there are more people in cognitive decline from prescription drugs in the past two years than all of history for habitual marijuana users.
10:06AM APR 16TH 2014
I hate to say it, but experience shows that a "Study" will show whatever the Authors want it to. A recent study in Britain showed that casual use had NO noticable effect on the lungs, unlike tobacco, which does serious damage quickly. As to the brain, there is no evidence that long term use, in ADULTS, does serious damage. It is a natural plant, modified by selective breeding, that can and does have medical uses. While opiates and other medications have been PROVEN to have serious, life threating side effects. There has been no real testing due to the federal ban, yet there is a lot of "non medical evidence" that it has uses above and beyond getting "high". I also hate to inform ya, that cat has been "out of the bag" for decades. Tens of thousands of your fellow Floridians already use marijuana, many medically, and of course, to get high. Yet it remains illegal, with significant legal penalities, while tobacco, booze and opiates, which do terrible damage remain legal. There is a real dis-connect in how these vices and medications are treated legally and it is time to repair some of that damage by legalizing Medical Marijuana. Please Vote YES on 2. Thanx

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