If the marijuana industry doesn’t soon have easier access to protected banking, legal pot companies will continue to face safety hazards while hauling around large amounts of cash, argued three prominent Nevada Democrats on Wednesday.
The politicians condemned Nevada Attorney General Adam Laxalt for not signing a recent letter to Congress supporting a bill to protect banks that open their doors to such marijuana businesses.
“Get the cash out of the street, out of people’s hands and somewhere where it’s safe,” said state Sen. Tick Segerblom, who’s running for Clark County Commission this year. “This is a dangerous situation.”
Segerblom was joined by U.S. Rep. Dina Titus, state Senate Majority Leader Aaron Ford and Las Vegas attorney Ed Bernstein during the 15-minute rally at the central valley Las Vegas ReLeaf dispensary at 2244 Paradise Road, a block off the Strip.
They rallied in response to news that Laxalt was the only attorney general from a recreational pot-legal state who did not sign a letter urging the passing of the Secure and Fair Enforcement Banking Act, which would allow banks to serve marijuana-related businesses without fear of penalties from the federal government. Attorneys general from 19 states signed the letter, including those from recreational pot-legal states California, Oregon, Washington, Alaska, Colorado, Maine and Massachusetts.
Laxalt’s spokeswoman Monica Moazez said in a statement that Laxalt is “actively monitoring the issue” and that the attorney general has requested a meeting with recently implemented interim U.S. Attorney Dayle Elieson.
“He believes action on this letter is premature until that meeting,” Moazez said.
Protections for banks that work with marijuana companies — outlined in the 2013 Cole Memorandum — were eliminated on Jan. 4 via a memo from U.S. Attorney General Jeff Sessions to U.S. attorneys general in pot-legal states. In that letter, Sessions emphasized U.S. attorneys’ authority to enforce federal marijuana laws under the Department of Justice’s “well-established principles.”
While some banks, like Colorado-based Safe Harbor and Oregon-based Maps Credit Union offer banking for the pot industry, most banks, including all such financial institutions in Nevada, have avoided weed altogether.
Las Vegas-based First Security Bank of Nevada offered banking for medical marijuana stores for less than a year but stopped it was “cost prohibitive” and “burdensome,” CEO Jason Awad told the Sun last August.
Marijuana is still federally illegal, classified as a Schedule I narcotic, which puts the plant on the same level as heroin, LSD and ecstasy in the eyes of the federal government. That imposes a risk for banks, even if marijuana dispensaries are following state laws and regulations. Banks in Nevada don’t allow dispensaries to open accounts because marijuana remains illegal under federal law, and most banks are federally insured.
For the time being, making a bank deposit for marijuana store owners can involve spraying air freshener on cash stacks to mask the marijuana smell and purchasing money orders to avoid federal suspicious activity reports from depositing too much cash, according to interviewed dispensary owners in Nevada and other pot-legal states.
To skirt the system, some license holders use generic-sounding entities as their business names such as Denver’s Royal Asset Management and RK Enterprises, and talk around the issue of what kind of businesses they operate when asked simple questions by bank employees.