Colorado Springs State Bank, Colorado’s last bank that was openly doing business with medical marijuana sellers, has decided to close all of those accounts due to concerns about legal issues, 9News reports.
According to CBS Denver, John Whitten, Colorado Springs State Bank president, said that the legal and regulatory issues need to be resolved before banks can handle those kind of business accounts.
President of the Colorado Springs Medical Cannabis Council, Tanya Garduno, spoke with The Gazette voicing the shock in the medical marijuana business community over the decision, “Colorado Springs State Bank has been helping us for over a year and has consistently been telling us we have nothing to worry about. It was a pretty abrupt decision.”
With the last bank now refusing to do business with the medical marijuana industry, The Daily Camera reports that Colorado dispensaries are left stuck between a rock and hard place -- state law requires MMJ businesses to keep track of their transactions, but that task of record keeping is much more difficult when banks won’t work with them.
In early July, the Department of Justice threatened that it was going to begin to raid and prosecute medical pot shops even in states where the drug is legal, The Huffington Post reported. This kind of Federal law has scared off more and more banks that were at one point will to work with these small businesses operating in a strange legal gap where state law ends and federal law begins.
Some banks, especially the big banks, began withdrawing accounts from MMJ businesses back in early 2007 or 2008 when the U.S. Drug Enforcement Administration warned big banks that they could face potential legal liabilities if they do business with dispensaries, Reuters reported in June.
Sue Harank, co-owner of Denver’s Alpine Herbal Wellness, said that finding a bank was a “nightmare.” She opened her shop in 2010 and during the following six months two banks and a credit union closed her accounts.
Unfortunately for marijuana businesses, banks refusing to do business with them could be the least of their worries. The federal government ruled in July that marijuana has no accepted medical use and should remain in the same class as drugs as heroin, The Huffington Post reported.