By Sarah Snell Cooke, principal, Cooke Consulting Solutions

Mary Jane’s business is obviously a cash-laden business. Even where marijuana is legal some people don’t want anyone, such as employers, to smoke them out. Cash-heavy businesses also have certain physical security precautions that must be taken to keep the credit union and marijuana-business members safe, including at credit unions serving marijuana businesses literally laundering the money to help employees and members avoid a contact high. As Bob Dylan wrote, “They’ll stone you when you’re trying to be so good.”

Additionally, one CU Journal article pointed out that BSA reporting increased dramatically at Partner Colorado Credit Union, which has made quite a business from this green line of business, but paid a compliance price. CEO Sundie Seefried has written a whole book about how the credit union has worked to keep the credit unions’ business and it’s marijuana members compliant, safe and happy, titled "Navigating Safe Harbor: Cannabis Banking in a Time of Uncertainty,” available on Amazon.

Please join us for the Underground Collision in New York City on Monday, May 8, prior to CO-OP’s THINK for a discussion of marijuana banking, whether big credit unions are carrying small ones or vice versa, ‘only if I win’ collaboration, and more! Register here.

In a CU Times reader poll with 168 respondents, the vast majority (66%) declared credit unions should be doing business with marijuana businesses in state where it’s legal. Another 29% of respondents said they should wait until it’s legal under federal law. Only 5% responded with a flat-out, ‘No.’

The poll is admittedly unscientific, and readers might lobby others to vote a certain way based on personal interest, but it still surprised me that most were in favor of serving joint accounts.

Credit unions are notoriously conservative; the majority doesn’t even offer business services at all because of the associated risk and the institution’s resources for mitigating it. But now we’re making the leap to providing products for pot plantations?!?!

As Seefried told CU Journal, the reason is simple: Members need the service. The service the Partner Colorado provides is safety, both for the businesses, the owners, and the community in which the credit union operates. The set up process was atrocious, but now that the program is fully baked things have mellowed out, according to Seefried. And, she said, there’s enough weed for the credit union to keep picking for a long time.  

The FinCEN’s Cole Memo offers some reassurance that prosecution of drug crimes is prioritized toward preventing distribution to minors and revenue to cartels, among other things, as well as providing guidance on how financial institutions can serve marijuana businesses without being a dope. Filing of SARs and CTRs is covered.

So now that that one credit union has produced a turnkey guide from the business side, and regulators, including the NCUA, have at least recognized that traditional financial institutions can be a partner in ensuring compliance with state laws for doobies—heck, Four Corners CU was founded to serve the cannabusiness—how  can we spark it up? (The discussion, that is.)

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