Last bank shuts doors on Colorado pot dispensaries

Dec 8, 2004
49,441
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Maine
#1
At one Colorado Springs medical-marijuana dispensary, there is the usual assortment of cannabis and marijuana-infused sweets.

Starting today, however, the owner will have something else on the premises: a much, much bigger safe.

On Friday, the last bank in Colorado to openly work with the medical-marijuana industry — Colorado Springs State Bank — officially closed down the accounts of dispensaries and others in the state's legal marijuana business over concerns about working with companies that are, by definition, breaking federal law. Robert Frichtel, an industry consultant who runs the Medical Marijuana Business Exchange, estimated the number of accounts the bank held to be around 300.

That development — the latest in a series of problems medical-marijuana businesses have had in finding banks to work with — has sent the industry into a now-familiar scramble to find a place for its money. What's different this time is that no obvious solution has presented itself, leading Frichtel and others to conclude the industry is in for a prolonged period of operating cash-only.

"My clients are in a panic state over how they are going to survive in an all-cash environment," Frichtel said.

That's where the really big safe comes in.

The owner of the Colorado Springs dispensary — who didn't want his name or the name of his business used for fear of attracting thieves — said he will have to stick money in there instead of depositing it into a bank account. He's also planning to take a class this weekend to get a concealed-weapons permit, for protection outside the store.

"Any way you plan it out," the owner said, "there's going to be a large amount of cash around. And that's extremely scary."

It also presents a daunting challenge for Colorado's medical-marijuana-business regulators, who are charged with tightly auditing the state's dispensaries. Julie Postlethwait, a spokeswoman for the Department of Revenue's Medical Marijuana Enforcement Division, said cash-only dispensaries would make auditing more difficult. But she said the division is confident it can handle the task.

"We have so many good controls that will be in place," she said. ". . . This is one of the most heavily-regulated industries in the state."

Short of encouraging banks to be open for business with dispensaries, Postlethwait said there is little the division can do about the banking issues. But dispensary owner Jill Lamoureux said medical-marijuana advocates plan to push the legislature to allow them to form a credit union — albeit an uninsured one because it is unlikely the credit union could get federal insurance.

Lamoureux said she has been able to find a new bank, although she is keeping its name to herself because she doesn't want publicity to spook its board.

"I've heard of people taking road trips to Nevada," she said of dispensaries hunting for new banks. "I've heard of people buying pre-paid debit cards. . . . I think everybody is in a little bit of a panic mode."

But complicating things even more, Lamoureux said, is that even dispensaries with banks are finding their credit-card-processing services cut off.

Jim Marty, an accountant who works with a number of dispensaries, said the financial changes won't kill the medical-marijuana industry — there's nothing wrong, he said, with being a cash-only business — but they will test it.

"It's inconvenient," he said. "It makes it hard to act like a legitimate business."

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NuttyJim

Registered User
Feb 18, 2006
14,114
6,401
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#3
He should use the money to send guns to Mexican drug cartels.
As long as part of the return deal is more cash, churro's, rice and beans, and taco's. I have a serious craving for Mexican today. Hot Mexican pussy will do as well.
 

d0uche_n0zzle

**Negative_Creep**
Sep 15, 2004
46,847
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F.U.B.A.R
#4
Wonder how much money the Mexican cartels have given to the Big Zero's reelection campaign? "whaa"
 

THE FEZ MAN

as a matter of fact i dont have 5$
Aug 23, 2002
42,911
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#5
i find it funny that banks are afraid of legitimate business yet love to steal from people all the time.
 

Party Rooster

Unleash The Beast
Apr 27, 2005
40,284
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The Inland Empire State
#6
It also presents a daunting challenge for Colorado's medical-marijuana-business regulators, who are charged with tightly auditing the state's dispensaries. Julie Postlethwait, a spokeswoman for the Department of Revenue's Medical Marijuana Enforcement Division, said cash-only dispensaries would make auditing more difficult. But she said the division is confident it can handle the task.
Brilliant move.

Lamoureux said she has been able to find a new bank, although she is keeping its name to herself because she doesn't want publicity to spook its board.
So is the headline wrong? There is actually an "unofficial" bank willing to do business with these guys? I'm sure word will get around to the other dispensaries.
 

VMS

Victim of high standards and low personal skills.
Apr 26, 2006
10,309
2,650
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#7
Get a bunch of dispensaries together, form a credit union, make more money that way.

With the amount of cash that is going through these dispensaries' hands (if they're run at all well), it shouldn't be all that hard to form a small credit union.
 

Norm Stansfield

私は亀が好きだ。
Mar 17, 2009
15,949
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#8
i find it funny that banks are afraid of legitimate business yet love to steal from people all the time.
That's some great insight you've got there. You and the guy taking a shit on that cop car, both really know the ins and outs of high finance.
 

Norm Stansfield

私は亀が好きだ。
Mar 17, 2009
15,949
4,075
328
#9
Get a bunch of dispensaries together, form a credit union, make more money that way.

With the amount of cash that is going through these dispensaries' hands (if they're run at all well), it shouldn't be all that hard to form a small credit union.
The reason why banks aren't working with these people is fear of retaliation from the federal government. And credit unions are even more at the mercy of federal authorities than banks, so I don't think that would work out so well.
 

whiskeyguy

PR representative for Drunk Whiskeyguy.
Donator
Jan 12, 2010
36,554
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#10
Blame the federal government, not the banks. Once you give the feds leeway to violate the 10 Amendment, your ability to self-govern is drastically reduced.

Another thing... does anyone disagree that this may be one of Obama's dumbest moves approaching the 2012 election? He's not going to win over the conservative anti-drug types no matter one, and he's definitely going to be alienating his base.
 

Party Rooster

Unleash The Beast
Apr 27, 2005
40,284
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The Inland Empire State
#11
Another thing... does anyone disagree that this may be one of Obama's dumbest moves approaching the 2012 election? He's not going to win over the conservative anti-drug types no matter one, and he's definitely going to be alienating his base.
Good point. He's already lost the right-center vote so I expect him to go after the lefty vote with stuff like gay marriage and making more of a stance on the medical marijuana issue as we get closer to the election. It's shaping up to be a pretty dismal Democrat turnout in 2012 without some key wedge issues.

And FWIW, the recent "crackdown" by the feds is primarily against dispensaries violating state and local laws. Selling within 1000 feet of a school, selling for a profit, selling to minors, and shipping marijuana across state lines to other dispensaries.
 

MayrMeninoCrash

Liberal Psycopath
Dec 9, 2004
24,642
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Loveland, CO
#12



Not to mention the recent crackdowns on California dispensaries. I heard the Feds on the news talking about how terrible these operations are because their high profit margins take advantage of poor people trying to afford their medicine. Yet no one has busted down the front doors at Pfizer, GlaxoSmithkine, Merck or Eli Lilly.
 
Dec 8, 2004
49,441
21,269
693
Maine
#13
Get a bunch of dispensaries together, form a credit union, make more money that way.

With the amount of cash that is going through these dispensaries' hands (if they're run at all well), it shouldn't be all that hard to form a small credit union.
They might be able to do that... but do you think Visa/Mastercard etc would accept payment from them?
 

JonBenetRamsey

well shit the bed
Aug 30, 2005
17,433
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woodland critter christmas park nj
#14
i think a special session of congress needs to be called. one in which they all sit down and smoke a joint. then maybe these assholes will realize they're fucking morons for giving a shit about marijuana laws. we know it doesn't make black men **** white women. white women being hotter than black women is what causes that.
 

whiskeyguy

PR representative for Drunk Whiskeyguy.
Donator
Jan 12, 2010
36,554
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Northern California
#15
we know it doesn't make black men **** white women. white women being hotter than black women is what causes that.
Oh, so I see, the women are the ones asking for it???

Fuck yeah those whores are asking for it. :action-sm