Cooperation on Canabis Co-Ops

Colorado lawmakers are anxious to find a way to get the cannabis biz into the banking system, so anxious that, before they lost their train of thought and ran out to gorge on a crate of Cheetos, two of them introduced a bill in the Colorado House the "Marijuana Financial Services Cooperatives Act." The act would create "cannabis co-operatives" that, somehow, would operate in a manner that banks do not in order to provide financial services to Mary Jane businesses. As we've discussed, banks won't do that sort hazy business.

The proposed "cannabis co-ops" under the bill could not call themselves a bank or a credit union, wouldn’t need to get deposit insurance like a regular bank, and must provide written evidence to the state commissioner of financial services that they have “approval by the Federal Reserve bank for access by the co-op to the Federal Reserve system."

Don Childears, head of the Colorado Bankers Association immediately threw a wet blanket on this lit roach.

“We don’t think it will work because they can’t get access to the Fed’s payments system,” he said. “No one gets access to the payments system without being under a federal regulatory agency.”

But it could be a way for Colorado lawmakers to go to Congress and tell them they need to deal with the issue, Childears said.

"If it doesn’t work, this says to Congress, 'Get off the dime. You need to address this,'" Childears said.

It's an election year. What is the upside for any legislator outside of Colorado (and Washington, will be selling "recreational marijuana" in the near future) to make it easy to avoid the Controlled Substances Act and other federal drug trafficking laws? It is my understanding that there has been some bi-partisan pushback against FinCen's recent guidance on marijuana money laundering and BSA compliance issues from Senators Grassley and Feinstein, who are joiniing hands across the aisle to smack FinCen up the side of the head for attempting to state it would look the other way on enforcement of federal drug laws. Even if Congress realizes it needs to get of the dime, I doubt it will do it.

No, this bill is not likely to accomplish much of anything.

"It's a complicated case, Maude. Lotta ins, lotta outs, lotta what have yous. Fortunately I've been adhering to a pretty strict, uh, drug regimen to keep my mind, you know, limber."
---The Dude