Operating a store selling a product that’s legal in your state but illegal on the federal level creates a unique business challenge: running a business without being allowed to use banks. Yet ballot initiatives on Election Day, just over a week from today, could make recreational or medical cannabis legal for recreational or medical use in 34 states, and for both in populous states like California and Massachusetts. Could this push the feds to do something about the banking situation?
The situation right now is an inconvenient one: cannabis businesses have a special tax deposit area with elaborate security procedures in Oregon, and some businesses in Colorado literally launder their money — giving it a soak in fabric softener to get rid of the telltale smell before depositing it in a bank.
Some retail businesses set up bank accounts in the names of holding companies, but the cash-only rule applies to customers, too: they can’t use credit cards. Everyone knows that dispensaries are stuffed with cash, so they need serious security. Even then, there have been 600 reported robberies just in Denver since the legalization of recreational marijuana in Colorado in 2013.