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U.S.: Senate Committee Allows Banks To Provide Services To Legal Marijuana Stores

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Fourth Straight Senate Victory for Marijuana Reform

Senate Bill Would Also Allow D.C. to Tax and Regulate Marijuana

By Steve Elliott
Hemp News

The Senate Appropriations Committee on Thursday voted 16 to 14 to allow banks to provide services to marijuana businesses. Currently, because marijuana is illegal under federal law, both medical and non-medical marijuana businesses are unable to access banking services like any other business. The amendment was offered by Sen. Jeff Merkley (D-Oregon).

Consequently, many marijuana businesses operate on a cash-only basis, leading to huge public safety issues as businesses become the target of robberies, and are forced to hire armed security to protect their takings.

“One of the motivations for legalizing marijuana is to eliminate the illicit market and put marijuana in the hands of a legitimate regulated market,” said Michael Collins, deputy director of national affairs at the Drug Policy Alliance (DPA). “Whether you are for or against legalization, you have to recognize that having marijuana businesses handling huge amounts of cash with nowhere to deposit the money is a public safety concern that Congress has to tackle.”

U.S.: Start-Ups Step In For Wary Banks To Serve The Marijuana Industry

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By Steve Elliott
Hemp News

Several recently created start-ups are looking to solve one of the most persistent problems facing the nascent marijuana industry in Colorado, Washington and other legal states: the cash-only nature of a business which is still defined as illicit by the federal government.

While voters in Washington and Colorado in 2012, chose to bring marijuana commerce into the mainstream, with Oregon and Alaska joining the club in 2014, the federal government hasn't, shall we say, shown much political courage when it comes to biting the bullet and joining the 21st century.

VISA and MasterCard won't process transactions from marijuana dispensaries, fearing federal racketeering charges since cannabis is still nonsensically considered a Schedule I controlled substance under federal law. And most banks are scared silly by the prospect of "marijuana money" being in their vaults, for the same reason.

This means most medical marijuana dispensaries and recreational pot stores have a constant influx of cash, and the options of what to do with it range from dangerous on the one hand to more dangerous on the other.

Tokken, Hypur, and Kind Financial, among other start-ups, have started putting together software that helps banks and pot shops monitor and record sales, with the eventual goal of moving transactions away from cash, reports Nathaniel Popper at The New York Times.

U.S.: Credit Union Fights In Court To Become World's First Marijuana Bank

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By Steve Elliott
Hemp News

In a high-stakes, closely watched lawsuit, the founders of the Fourth Corner Credit Union, which wants to become the world's first bank focused on the marijuana industry, is suing the U.S. Federal Reserve for the right to do so.

There's more at stake that just the fate of the credit union, reports Joel Warner at the International Business Times. The results of the case could have a ripple effect across the cannabis industry, which everyone agrees is currently lacking proper financial services.

"This transcript is going to be read around the world and your decision will have an effect around the United States in a major, major way," Mark Mason, attorney for the plaintiffs, told Judge R. Brooke Jackson on Monday.

"This isn't something that is going away," Mason said during his impassioned oral arguments for the credit union, whose founders include several members of his immediate family. “This is something that is going to be a part of the next generation and the future, and we need to get it right. And if we are not going to have banking ... and have millions and millions of dollars on the streets where bad things can happen, that is not responsible.”

U.S.: What Happened When States Legalized Marijuana

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By Steve Elliott
Hemp News

When the sale of marijuana for recreational use became legal in Colorado and Washington last year -- and in Oregon this year -- a few predictions, both good and bad, were made about the outcome. Here's what has actually happened so far.

Positives

• No increase in teen use: Opponents of legalization claimed young people would flock to weed if the legal penalties were removed. That hasn't happened, reports Daniel Dale at The Star. Major studies have found no increase in teen use in states the legalized medical marijuana; in Colorado, fewer students said they used pot after legalization than before.

• Tax windfall: Colorado has taken in more than $86 million in cannabis taxes and fees this year, far more than for alcohol. Washington state is predicting $1 billion in marijuana taxes over the next four years. "All that money that was going to criminals and the hands of cartels is now being sent toward legitimate taxpaying businesses," said Morgan Fox of the Marijuana Policy Project.

Colorado: Feds Reject Marijuana Bank

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By Steve Elliott
Hemp News

The federal government has dealt yet another setback to attempts to provide banking services to the marijuana industry.

The Federal Reserve, in a Wednesday court filing, said it doesn't intend to accept any money connected to cannabis sales, because marijuana remains a Schedule I controlled substance under federal law, reports the Associated Press.

The stance, taken in response to an attempt by a Colorado-based company, appears to signal a shift in the position of the federal government. Last year, the U.S. Treasury Department had issued rules for how banks can accept marijuana money.

"We're frustrated," said Andrew Freedman, in charge of marijuana coordination for Colorado Gov. John Hickenlooper. "We tried to do the most with the building blocks of instructions they sent us, set up the most rigorous solution. And we still are left with confusion."

The court filing came in a legal tussle between the Federal Reserve and Fourth Corner Credit Union, established in 2014 to serve Colorado's marijuana industry, now worth $700 million annually.

Fourth Corner can't open without permission from the Federal Reserve, which said in its court filing that "transporting or transmitting funds known to have derived from the distribution of marijuana is illegal."a

Oregon: Congressman Earl Blumenauer Calls For End To Failed Marijuana Prohibition

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As Oregon’s Emerging Marijuana Industry Visits Capitol Hill, Rep. Blumenauer Calls for Federal Government to Get Out of the Way

As representatives from the Oregon Cannabis Association visited Capitol Hill on Wednesday, Representative Earl Blumenauer (OR-03) on the House floor called for an end to the federal government’s failed approach of marijuana prohibition.

“Mr. Speaker, advocates from the new emerging marijuana industry in Oregon are descending on Capitol Hill at a very critical time for this fledgling industry," Congressman Blumenauer said. "They have a report about the implementation of Oregon’s Ballot Measure 91, overwhelming approved by voters last year to legalize, tax, and regulate marijuana at the state level.

“Possession became legal July 1st," Blumenauer said. "Retail sales were authorized in existing dispensaries on the 1st of October to significant interest around the state. The first week saw an estimated $11 million in sales. They are working hard to implement the spirit and the letter of the measure, working closely with the Oregon legislature to refine it – learning from the experiences of states like Washington and Colorado that have already legalized adult use.

“Theirs is a positive story of economic opportunity, product development, tax revenues, more freedom for individuals, and eliminating the racial disparities in the enforcement of a failed policy of prohibition that comes down heavily against young men of color – especially African Americans," Rep. Blumenauer said.

U.S.: Senate Spending Package Includes Major Marijuana Law Reforms

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By Steve Elliott
Hemp News

A new package of spending bills from the Senate, intended to keep the federal government operational for the next year, includes several positive changes in marijuana law.

The bills were filed on Tuesday by Sen. Thad Cochran (R-Mississippi), chairman of the Senate Appropriations Committee, and they've just been uploaded to Congress's website, reports Marijuana.com.

The new spending package put forth by the top Senate appropriator "includes, well, everything us marijuana law reformers could have reasonably hoped for this year," said Tom Angell, chairman of Marijuana Majority.

“We won bipartisan votes on all of these issues this year on either the House floor, in the Senate Appropriations Committee or both, so this is a rare case of Congressional leadership actually listening to their members — and to the American people," Angell said.

"Just a few short years ago, politicians used to jump all over each other to be seen as the ‘toughest’ on drugs," Angell said. "But now that polls consistently show that a growing majority of Americans support legalization, more elected officials are beginning to realize that scaling back failed prohibition policies is not only the right thing to do, but that it’s politically smart."

If enacted, the bills would:

U.S.: Northsight Capital Engages Cannabis Investment Bank Viridian Advisors

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Northsight Capital, Inc., a marijuana-related media company, on Wednesday announced that it has engaged Viridian Capital Advisors for financial and corporate advisory services, including investor relations, public relations and capital raises.

Viridian Capital Advisors, LLC is the first Wall Street investment bank and advisory platform dedicated to the cannabis market. Viridian specializes in boutique banking and strategic advisory that provides research, investment banking, investor relations and corporate development services to emerging growth companies in the cannabis sector.

Northsight Capital, Inc. is a media company comprised of a portfolio of online marijuana-related websites that are developed and operated by the company. These sites incorporate many aspects of the cannabis industry. The company announced it "intends to provide its audience with a means to stay informed on the industry’s most cutting edge marijuana-related innovations and legislation."

The company’s most dynamic concept, WeedDepot.com, provides consumers with a geo-targeted map directory of medical and recreational dispensaries, head shops, doctors, attorneys and more within the marijuana industry. The Weed Depot app can be downloaded for free at the iTunes Store and Google Play.

"Weed Depot has an entire platform of content suited for every aspect of advertising and marketing to consumers from all businesses in the cannabis industry," according to the company.

U.S.: National Cannabis Industry Association Expands Advocacy Team On Capitol Hill

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“We’re taking our legislative strategy to a new level, enlisting a top-quality bipartisan team to further fight for the rights of our responsible small business owners.”

With the legal marijuana business valued at nearly $3 billion nationwide and growing, a national trade group -- the National Cannabis Industry Association (NCIA) -- is expanding its advocacy team on Capitol Hill.

NCIA has partnered with D.C.-based public affairs firms Heather Podesta + Partners and Jochum Shore & Trossevin PC to magnify its efforts to address the industry’s top federal priorities: access to basic banking services and fair federal taxation.

“In the five years since NCIA was formed, we’ve gone from simply seeking to have our industry’s issues taken seriously to bipartisan legislation introduced in both chambers,” said NCIA executive director Aaron Smith. “We’ve seen successful appropriations amendment votes on the House floor and in Senate committee, and we’ve helped bring together a coalition of lawmakers that spans the political spectrum.

“Now we’re taking our legislative strategy to a new level, enlisting a top-quality bipartisan team to further fight for the rights of our responsible small business owners to be treated fairly under federal law,” Smith said.

U.S.: Solution Launched To Enable Banks To Serve The Marijuana Industry

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Link to Banking, comprised of bankers, Certified Anti-Money Laundering Specialists (CAMS) and anti-fraud professionals, including a former bank regulator and former official from the Financial Crimes Enforcement Network (FinCEN), in partnership with Kind Financial, a financial solutions company to the cannabis industry, on Tuesday announced what they called "a software solution to enable banks to serve cannabis-related businesses."

Link to Banking’s new, Bankers Link to Cannabis Compliance (BLINCC) program ties into Kind Financial’s Seed to Banking solution. The combination offers banks a compliant real-time solution that monitors cannabis related businesses at a granular level.

"This program provides a web based system with customizable dashboard, enhancing the banks on-going transaction monitoring and due diligence through real-time access to customer transaction data," the companies announced in a prepared statement. The platform incorporates technology that monitors, tracks and reports the customer transaction data from seed to sale as well as bank deposits, i.e., a Seed to Banking solution.

According to the companies, his technology compliments Link to Banking’s broader business services that:

• Evaluates each bank’s Bank Secrecy Act/Anti-Money Laundering program (BSA/AML) and recommends enhancements to facilitate banking services to the cannabis industry.

U.S.: Marijuana Banking Bill Introduced By Bipartisan Group Of Senators

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Legislation Would Allow Marijuana Businesses Access to Financial Services

Marijuana Businesses Currently Operate as Cash-Only Causing Huge Public Safety Concerns

By Steve Elliott
Hemp News

Senators Jeff Merkley (D-OR), Cory Gardner (R-CO), Michael Bennett (D-CO), Rand Paul (R-KY), and Ron Wyden (D-OR) on Thursday introduced the Marijuana Business Access to Banking Act, a bill that would allow banks to provide depository and other financial services to state-legal marijuana businesses.

Currently, because marijuana is illegal under federal law, both medical and non-medical marijuana businesses are unable to access banking services like any other business. Consequently, many cannabis businesses operate on a cash-only basis, leading to huge public safety issues as businesses become the target of robberies, and are forced to hire armed security to protect their takings.

“One of the motivations for legalizing marijuana is to eliminate the black market and put marijuana in the hands of a legitimate regulated market,” said Michael Collins, policy manager at Drug Policy Alliance’s Office of National Affairs. “Whether you are for or against legalization, you have to recognize that having marijuana businesses handling huge amounts of cash with nowhere to deposit the money is a public safety concern that Congress has to tackle.”

U.S.: Acquisition Paves Way For First 'Seed-To-Banking' Solution For Marijuana Industry

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Kind Financial Acquires the Assets of Agrisoft Development Group

Kind Financial, a financial solutions company to the cannabis industry, on Thursday acquired the assets of Agrisoft Development Group, a seed-to-sale compliance software company.

The Agrisoft platform is used in cannabis dispensaries and cultivation operations in numerous states and Canada. It provides these facilities with back-office, inventory, biometric security, state regulation reporting systems and payment system adaptability.

Kind explained that with the expansion of legalized cannabis there's been more stringent regulations for inventory requirements including mandates for tracking cannabis and cannabis products from seed-to-sale.

Agrisoft's platform is the most advanced and detailed technology created specifically for the cannabis industry, offering 100 percent accountability and transparency of reporting to all levels of government, according to the company. "Its team of experts in law enforcement, regulatory compliance, software development and data security have combined their expertise to build the industry's most reliable and comprehensive tracking system," a prepared statement avers.

Agrisoft's platform documents every step in cannabis manufacturing, wholesaling and retailing, according to the company.

U.S.: Marijuana Businesses Access To Banking Act Reintroduced

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U.S. Reps. Ed Perlmutter (CO-07) and Denny Heck (WA-10), along with a bipartisan group of 16 other Republicans and Democrats, on Wednesday re-introduced H.R. 2076, the Marijuana Businesses Access to Banking Act of 2015 to resolve the banking crisis marijuana-related businesses are facing.

By updating federal banking laws and regulations to resolve conflicts between federal and state laws, the legislation allows marijuana-related businesses to access the banking system, ensuring these businesses do not have to operate on a cash-only basis. In addition, a similar companion bill in the Senate is expected to be introduced soon.

“First and foremost this is an issue of public safety,” said Rep. Perlmutter. “Not only are the proprietors at risk, but the employees and customers are also at risk of serious and violent crimes.

"It is estimated that 40 percent of the marijuana-related businesses in Colorado are unbanked," Rep. Perlmutter said. "This means hundreds of millions of dollars in cash are moving around the streets of Colorado. There are now some 213 million Americans who live in the 23 states plus the District of Columbia where the voters have allowed for some use of marijuana, and it is coming to a state near you soon.”

“The federal government can’t keep an eye on business practices if they are forcing them offline and underground,” said Rep. Heck. “Forcing businesses into cash-only territory is a dangerous step away from legitimacy, transparency, and regulation and a huge step towards crime, tax evasion, and access to minors.

U.S.: MBank To Close All Marijuana Business Accounts

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By Steve Elliott
Hemp News

Was it too good to last? MBank, a small community bank based in Gresham, Oregon, that quickly became one of the main banks serving the marijuana industry, has announced that it will close all of its accounts with cannabis companies within the next two months.

The cost and time spent on compliance with federal banking rules is just too much for the company to handle, according Jef Baker, CEO and president of MBank, reports Tony C. Dreibus at the Marijuana Business Daily.

The bank currently has between 70 and 75 accounts with marijuana businesses, according to Baker. Most of those accounts are in Oregon, with a few in Washington state.

“We just do not have the resources to manage the compliance necessary” to continue to service the cannabis industry, Baker said. “This is not what we want to do, this is what we have to do," he said. "We got into this business to serve an underserved group and I wish we could still do that.”

The banks customers will have "a couple months" before their accounts are closed, Baker said on Friday afternoon.

Graphic: Greg Stump/The Stranger

U.S.: Kind Financial Gets 2nd Round of Funding to Provide Financial Solutions to Cannabis Industry

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Kind Financial, (formerly KindBanking), the financial solutions platform for the cannabis industry, on Thursday announced that it has secured its second round of funding.

The company, in a prepared statement, said this investment will accelerate its mission to provide the legal cannabis industry with a full platform of financial services including, but not limited to, merchant and payment services, financing, equity investments, and insurance offerings. The company said it plans to launch a payment solution for the cannabis industry in the first quarter of 2015.

"Legitimate cannabis businesses are being denied many of the financial services available to other industries," explained David Dinenberg, founder and CEO of Kind Financial. "As a result of current regulatory measures, most financial institutions such as banks and credit card companies, are reluctant to do business with the cannabis industry.

"Our financial platform will fill this crucial need as the industry continues its exponential growth," Dinenberg said.

The investor group was led by Lindy Snider, founder and CEO of LindiSkin which manufactures and distributes clinically-proven skin care products for cancer patients. This is the latest in a series of investments Snider has made within the cannabis industry including a product designed to safely ship medical marijuana plants as well as an asset management company.

D.C.: Marijuana Industry Women To Kick Off Day Of Capitol Hill Lobbying

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Rep. Jared Polis (D-CO), Leading Female Cannabis Entrepreneurs, National Cannabis Industry Association Will Highlight Key Issues Affecting Small and Women-Owned Cannabis Businesses

Rep. Jared Polis will join leaders and members of Women Grow, a national network of female cannabis industry professionals, and the National Cannabis Industry Association (NCIA) in the National Press Club’s Zenger Room on Thursday, February 12 at 9 a.m., to set the agenda for the group’s first-ever Lobby Days.

On February 12 and 13, more than 60 Women Grow members from 14 states nationwide will converge in Washington, D.C., to promote the essential role of small and women-owned businesses in creating a diverse, responsible cannabis industry.

In meetings with Congressional representatives and staff, members will address key industry issues including fair taxation and access to banking.

Who:
Rep. Jared Polis (D-CO)
Jazmin Hupp, Executive Director & Co-Founder, Women Grow
Taylor West, Deputy Director, National Cannabis Industry Association
Women Grow members from more than a dozen states’ cannabis industries

What:
Women Grow Lobby Days Press Conference

When:
Thursday, February 12, 2015 at 9 a.m.

Where:
Zenger Room
National Press Club
529 14th St. NW, 13th Fl.
Washington, D.C. 20045

About Women Grow

Colorado OKs Marijuana Credit Union

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By Steve Elliott
Hemp News

Marijuana businesses in Colorado have plenty of cash flowing in, but are having a difficult time finding a legal place to put it.

Most banks still refuse to work with marijuana businesses, because they fear enforcement of federal banking laws, reports Alizeh Siddiqui at the Marijuana Policy Project (MPP). Cannabis, is, of course, illegal at the federal level. Now, a new credit union designed specifically for the legal marijuana industry hopes to offer a solution, reports Trevor Hughes at USA Today.

The Fourth Corner Credit Union plans to open within two weeks in Denver, offering to accept cash deposits and to allow members to make electronic cash transfers for payroll and rent, and to buy supplies.

"We are on the one-yard line," said attorney Mark Mason, who is advising the credit union's nine founders.

Banking regulators in Colorado granted Fourth Corner a charter on November 19, and now the union is waiting for the Federal Reserve to issue it a master account number, which would give it access to the U.S. electronic banking system. The credit union's organizers believe it will get the number without a fight, because the Federal Reserve is required give out numbers to organizations that have already been granted state charters.

U.S.: Banks Offering Financial Services To Marijuana Businesses

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By Steve Elliott
Hemp News

A top federal official on Tuesday said that 105 banks and credit unions are now doing business with legal marijuana merchants, and suggested that revised federal rules giving financial institutions the green light to provide services to cannabis businesses are starting to work.

The financial institutions in question cover about one-third of the United States, and have reported relationships with marijuana-related businesses, the top U.S. anti-money laundering official said, reports Jeffrey Sparshott at The Wall Street Journal.

The Obama Administration in February gave the go-ahead to the banking industry to offer financing and accounts to marijuana distributors who are legally conducting their business according to state laws, reports Danielle Douglas of The Washington Post.

"From our perspective the guidance is having the intended effect," said Jennifer Shasky Calvery, director of the Financial Crimes Enforcement Network. "It is facilitating access to financial services, while ensuring that this activity is transparent and the funds are going into regulated financial institutions."

U.S.: House Votes To Allow Banks To Work With Marijuana Stores and Dispensaries

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Historic Vote Falls on Heels of Votes in May to Prohibit DEA from Undermining State Medical Marijuana and Hemp Laws

Meanwhile Conflict Over Washington, DC Decrim Law and Legalization Ballot Measure Increases

In a historic vote, the U.S. House on Wednesday passed a bipartisan amendment by Representatives Denny Heck (D-WA), Ed Perlmutter (D-CO), Barbara Lee (D-CA) and Dana Rohrabacher (R-CA) preventing the Treasury Department from spending any funding to penalize financial institutions that provide services to marijuana businesses that are legal under state law. The amendment passed 231 to 192.

In May, the House passed an amendment prohibiting the Drug Enforcement Administration (DEA) from undermining state medical marijuana laws and passed two amendments prohibiting the DEA from interfering with state hemp laws.

“Congress is yet again rejecting the failed war on marijuana,” said Bill Piper, director of national affairs for the Drug Policy Alliance (DPA). “They have read the poll numbers and are doing both what is right and what is politically smart.”

U.S.: Banks Balk At Marijuana Money Despite Relaxed Guidelines

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By Steve Elliott
Hemp News

Despite the Obama Administration's message to bankers -- that even though marijuana sales are a federal crime, they can still provide banking services to this new industry without fear of prosecution, if they follow guidelines -- the nation's bankers say that doesn't change the fact that any bank which does so could be prosecuted.

While many in the cannabis movement praised the policy change as giving financial institutions the green light to finally serve the cannabis industry, bankers just don't see it that way, reports Herb Weisbaum at NBC News.

According to bankers, the guidance from the Justice Department and the Treasury Department doesn't change federal law, and a change in federal law is the only thing that would mean banks wouldn't be subject to prosecution for handling marijuana money. Besides, the new guidelines require lots of complicated paperwork and due diligence to satisfy federal regulators and prosecutors.

The guidance is a red light instead of a green light, said the Colorado Bankers Association. The group's senior vice president, Jenifer Waller, said the government detailed "all the risks involved of banking the marijuana industry" and "made it very clear that financial institutions can still face criminal liability."

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