It’s Legal To Sell Marijuana In Washington. But Try Telling That To A Bank.

By | Colorado Medical Marijuana Law, General Medical Marijuana Information, Medical Marijuana Law | No Comments

by Chana Joffe-Walt

November 16, 2012 4:00 AM

David McNew/Getty Images

Voters in Washington and Colorado just approved measures legalizing marijuana for recreational use. But businesses that want to sell marijuana in those states will face a problem: No bank wants to do business with them.

I called several banks in Washington. I called a local credit union, a tiny bank in the San Juan islands. Everybody said basically the same thing. Even if selling marijuana is legal under state law, it’s still illegal under federal law. And banks and credit unions worry that this could get them in trouble.

So people who want to go into the marijuana business — who want to legally grow, distribute, sell marijuana in the state — are going to have to operate, basically, like drug dealers. They’re going to have to run a cash business.

John Davis has been through the problem that future marijuana businesses are going to have. He sells medical marijuana in Seattle (medical marijuana has been legal Washington). And he had a really hard time finding a bank willing to work with him, so for a while he did business in cash.

Payroll was a mess. It’s impossible to order supplies — baggies, lights, display cases — without a credit card. PayPal works for some things, but not for others.

“How do you pay your taxes?” Davis says. “You can’t go into the Department of Revenue and give them a wad of cash.”

Davis learned a bunch of tricks for operating an all cash business, and even teaches a course called “canibusiness.”

In the end, Davis found a work-around that may be he best option for other people who want to get into the industry: Be vague with the bank. Don’t tell them exactly what line of work you’re in.

Davis says he doesn’t feel great about toying with the truth. But, he says, he has a legitimate business, and he needs a bank.

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Denver Lawyer Loses Liability Insurance over Mmedical-marijuana Clients

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5/13/2012 By John Ingold The Denver Post

In what appears to be a first-of-its-kind event nationwide, a Denver lawyer has lost her liability insurance because part of her practice involves representing medical-marijuana businesses.

Ann Toney’s insurance company told her last month that it will not renew her malpractice coverage. In its terse notice, the Hanover Insurance Group explained that Toney’s practice “does not meet current underwriting guidelines because of the following risk factors: Area of practice involving medical marijuana.”

Toney, a former prosecutor who has taught classes on medical-marijuana law for the Colorado Bar Association, said she was surprised. Most of her work representing medical-marijuana businesses came one or two years ago, when the state’s laws for such businesses were in flux.

She said she has always advised clients that marijuana sales remain illegal federally and made sure her clients are in compliance with state medical-marijuana law.

“You represent people under the laws of Colorado,” she said. “What’s the alternative? No one’s going to get any help following the law in Colorado?”

Allen St. Pierre, executive director of the National Organization for the Reform of Marijuana Laws, said he knows of no other lawyer to lose insurance because of work with medical-marijuana businesses.

“We’re certainly afraid we’re going to start seeing more now,” St. Pierre said.

He said 625 lawyers nationwide are members of NORML.

Toney’s nonrenewal started brewing earlier this year, when she asked to add a new lawyer to her firm’s coverage. The insurance company asked for more information about Toney’s work in the medical-marijuana field. T

oney replied that 70 percent of her practice involves drunken- and drugged-driving cases, with the remaining 30 percent consisting of criminal defense and medical-marijuana business representation.

Hanover’s nonrenewal notice followed Toney’s response.

Toney said her insurance broker has told her that she will have a hard time getting new insurance because she was dropped by a previous carrier.

Still, Toney said she is confident she can find another carrier willing to take her business.

“I’ll find coverage,” she said. “My only question is, How much more is it going to cost me?”

John Ingold: 303-954-1068 or jingold@denverpost.com

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Connecticut Senate passes Medical Marijuana Bill

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Reuters 5/5/2012 11:16:26 AM ET By Mary Ellen Godin

HARTFORD, Connecticut (Reuters) – The Connecticut Senate passed a bill on Saturday legalizing marijuana use for medical purposes with tight restrictions aimed at avoiding problems that have plagued some of the 16 other states where pot is now legal.

After nearly 10 hours of debate, the Senate voted 21-13 in favor of the measure, which already cleared the House.

Democratic Governor Dannel Malloy was expected to sign the bill. Once he does, Connecticut will join 16 other states and the District of Columbia in allowing use of marijuana to treat sick patients.

Connecticut’s legislation calls for tight regulation of the plant, a move advocates say is aimed at avoiding problems that have plagued some of the other states, include disagreements with the federal government.

Under the bill, patients and their caregivers must register with the Department of Consumer Protection. In addition, their doctors must certify there is a medical need for marijuana to be dispensed, including such debilitating conditions as cancer, glaucoma, HIV, AIDS, Parkinson’s disease, multiple sclerosis or epilepsy. And, medical marijuana would be dispensed only by pharmacists with a special license.

(Editing by Barbara Goldberg and Eric Beech)

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US Attorney Continues Medical Marijuana Crackdown

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5:37 PM, Mar 23, 2012 Written by: Chris Vanderveen

BOULDER – Colorado’s top federal prosecutor has made good on his promise to continue his crackdown on the state’s medical marijuana industry.

On Friday, US Attorney John Walsh sent letters to the owners of 25 medical marijuana dispensaries telling them they had a month and a half to either shut down or face the possibility of prosecution and property seizure. All, he said, are located within 1,000 feet of a school.

Two months ago, Walsh sent out similar warnings to 23 dispensaries.

“I would say to any medical marijuana dispensary owner whose facility is within a thousand feet of a school that they will be receiving this letter,” he told 9NEWS in January.

Friday’s round of warnings, according to a news release put out by his office, represents a “second phase of an initiative to close all marijuana stores within 1,000 feet of schools.”

The letters, according to the release, formally notify “them that action will be taken to seize and forfeit their property if they do not discontinue the sale and/or distribution of marijuana within 45 days from today.”

Walsh was unavailable for comment on Friday.

This all comes at a time when the Boulder County District Attorney is continuing to ask Walsh to halt the ongoing crackdown.

Last week, Boulder County DA Stan Garnett wrote a letter to Walsh asking the feds to focus their resources elsewhere.

“The people of Boulder County,” he wrote, “do not need Washington, D.C. or the federal government dictating how far dispensaries should be from schools.”

He added that prosecution of dispensary owners acting within the confines of state law serves “no practical purpose.”

This week, Walsh responded with his own letter to Garnett which said that he respectfully disagrees with the state prosecutor’s opinion.

“I believe that enforcing federal law to protect our children and young people from drug abuse is not only a legitimate use of federal resources, but a core responsibility for me and this office,” Walsh wrote.

Garnett said on Friday that he will hold firm with his position.

“I think there are other laws that could be enforced that would actually help us with public safety and not just be symbolic window dressing which this seems to be to me,” he said.

Marijuana, medical or not, remains illegal under federal law. In 2000, Colorado voters approved the limited use of medical marijuana.

(KUSA-TV © 2012 Multimedia Holdings Corporation)

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