Just got this from Compliance, what do you all think?

jryoung · Ladies Man Joined: 19 Mar 2004 Posts: 7664 City: Man Jose

As soon as the banks want to change the rules it will happen. With a reported $2M in tax revenue in CO already, it's only a matter of time before banks want to begin lending.

eeven73 · Posted: Mar 11, 2014 2:02 pm Post subject:

The problem is Fed inaction. Which I believe boils down to Congressional inaction.
Approx 2 weeks ago the Feds issued guidance to banks in CO and WA that while they aren't going to change to regulations they are not going to pursue action in those states. This was immediatly followed up by President of Bankers of America(not the right name, but whatever the trade organization for banks is) going Admiral Akbar, "It's a trap!!"

Maybe Barry could pen an Executive Order Idea

chavez · RIP MHL 04/25/1958 - 01/11/2006

jryoung, without a doubt. Did you see last month where the Treasury and DOJ issued guidelines on how banks can deal with MJ-related businesses without facing penalty?

http://www.washingtonpost.com/business/economy/obama-administration-clears-banks-to-accept-funds-from-legal-marijuana-dealers/2014/02/14/55127b04-9599-11e3-9616-d367fa6ea99b_story.html

Now, if the next admin comes in and decides they want to start enforcing it would cause a separate sh!tstorm, but I doubt it given that 60%+ of the attendees to CPAC say MJ should either be legal or legal for medical purposes. Especially with someone like Rand Paul at the virtual "front" of the R ticket choices for 2016.

chavez · RIP MHL 04/25/1958 - 01/11/2006

eeven73, I was writing as you posted.

eeven73 · Posted: Mar 11, 2014 2:11 pm Post subject:

My guess is it takes some type of catastrophic problem to move Congress off its ass.

Something like a Juarez type massacre.

Which with all that cash floating around would only seem to be a matter of time.

This morning I read that warehouse rents in Denver are topping out at $17 a square foot.

Shocked

2+2 no equal 4

Just wait till this bubble pops and all the Marijuana Millionaires go bust.

Okie Boarder · Ladies Man Joined: 03 Mar 2008 Posts: 10056 City: Edmond

Hopefully, we will see more and more players in the game get on board with legalizing and not establishing practices that hinder that progress. I do agree that the banks will drive this when they see the dollar signs.

Porterwake · Posted: Mar 12, 2014 8:52 am Post subject:

Should you be sharing this information or even have an opinion on it on an online forum?

chavez · RIP MHL 04/25/1958 - 01/11/2006

Porterwake, no privacy issues here (non-client and non-investment-specific).

Also, I don't work for them. We are independent.

ChrisG · Posted: Mar 12, 2014 11:14 am Post subject:

Partyb · Posted: Mar 12, 2014 12:09 pm Post subject:

I think we should all be thankful that this MJ movement has seemingly taken off and popular opinions seem to changing rapidly. It's exciting. It's going to take some time for these changes to sink in and for government to act and for laws to change. Relax.

eeven73 · Posted: Mar 12, 2014 12:44 pm Post subject:

It is going to be fascinating to watch market forces change the scenario.

My understanding is there is a shortage of supply in CO right now. Predictably capital will chase those returns and won't be long till there is a glut. Prices crater, Govt's golden revenue stream goes to stuff. Wash, Rinse, Repeat.

goofyboy · Posted: Mar 13, 2014 3:19 am Post subject:

Congress won't move because right now, the war on drugs is making more money than leagalizing it. All of those private jails need convicts to stay open, local police need all the tactical gear, etc, etc....

eeven73 · Posted: Mar 13, 2014 6:13 am Post subject:

Well in direct contradiction to this^

Holder has submited a proposal to the Federal Sentencing Board to reduce jail time for Non-Violent drug crimes.

goofyboy · Posted: Mar 13, 2014 6:55 am Post subject:

that would be nice if that moves through. Now we need to get more states to follow through.

That said, who has a bigger lobby - the banks or the jails / police / para military groups (DEA, etc). It all comes down to money at the end of the day.

chavez · RIP MHL 04/25/1958 - 01/11/2006

ontrider · Ladies Man Joined: 30 Jul 2003 Posts: 16491 City: Russia

I like 5.11T better than 401K!

ohsix

eeven73 · Posted: Mar 13, 2014 8:47 pm Post subject:

^ exactly why I will never ever, ever,ever,ever work in anything remotely resembling retail. The majority of people fit the can't understand bill to a T.

chavez · RIP MHL 04/25/1958 - 01/11/2006

ohsix, all financial institutions are required to ask for employment information. It's a standard called KYC - Know Your Client.

A client who refused such basic information would be what you call one of them "red flags". We would not open an account for a person who refused, neither would most institutions. It would constitute a violation of anti-money laundering rules/regs.

So the client, if they do work for a dispensary or grow operation (a legitimate business here), would either need to list that as their employ or lie to us. If the client did deliberately lie to us, and it was discovered, we would have to file a SAR (Suspicious Activity Report) with FinCEN (Financial Crimes Enforcement Network). What action they'd take is up to them, but it could put that money on ice for a while until it got sorted out.

ohsix · Posted: Mar 14, 2014 1:39 pm Post subject:

I have several investment accounts including an R.J. O'Brien commodities trading account which requires at least annual financials and a host of other forms. I know there are stacks of paperwork to fill out, and although I'm not maintaing any accounts for illegal purposes, I try to be as vague as possible when answering any questionnaire. If I was a legal marijuana grower, my occupation would probably be "botanist" or something of the like and my business would be a "nursery". I might grow another species of plant like agave so that I could converse about my agave nursery business when needed with financial advisors and such.

If you're smart enough to run a business and plan for your future, you should be smart enough to open an IRA without explaining that you are a marijuana grower. Especially if company ABC turned you down because you told them you're a marijuana grower, tell company XYZ about parts of your business that do not involve growing marijuana.

chavez · RIP MHL 04/25/1958 - 01/11/2006

ohsix, and likewise, if it became known that "420 Nursery" and employee John Doe who listed his occupation as "botanist" turns out to be a cover for a grow operation, and we knew about it, we'd be for lack of a better term: f*cked.

Hell, even if we didn't know, but regulators felt we "should have", we'd also be f*cked.

I get your angle, but it would be pretty messed up to get the sh*t end of that stick. AML laws are not a joke, penalties are very stiff and playing stupid doesn't work like it used to. We do more due diligence on our clients now than ever.