Why do financial institutions fail to serve the cannabis industry? You’ve certainly heard that question enough. It’s probably a little more complex than many realize. There are regulations, laws, complexity, reputation, etc. to consider. However, it is not just the financial institution telling you ‘NO’ because they won’t bank your cannabis business…. Third Parties play a major role in this national banking issue. A good question is whether they will continue to present roadblocks or will they see the need to work through this strange time where state and federal laws are in conflict? Remember, since most financial institutions are federally insured, federal laws cannot be ignored!
Not too long ago, I was emphasizing to a third-party how we strive to follow the rules, prioritize compliance and at our very foundation, do not want to do anything wrong when, well, I had to pause mid-sentence, realizing what I was saying and just a bit embarrassed,finished very slowly with…. “OK, except maybe the big elephant in the room… banking funds derived from a federally illegal substance.” That’s where we all get when we are in the industry long enough…. It becomes normalized and yet it is NOT! Until federally legal, banking is a violation.
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