The banker to Florida’s medical marijuana players is getting out of the business
“It’s an important initiative for us to act as a safe harbor for professionals in the cannabis industry,” First Green Bank said in a statement. “However, we have made the tough business decision to end our medical cannabis business practices and have an alternative solution for banking in place for our customers in the industry.”
THE INDUSTRY AND THE PATIENTS WILL BE FINE.
Trent Woloveck, president of The Green Solution National
Though most banks won’t touch the business, roughly 400 institutions across the country take on marijuana clients under guidelines established by the U.S. Department of Treasury’s Financial Crimes Enforcement Network. And like any business, marijuana companies rely on financial institutions to protect their money and facilitate transactions.
In Florida, where only 13 companies are licensed to grow marijuana — and only seven can actually sell it — the importance of having a financial partner becomes even more pronounced given the amount of money each company is working with. With First Green backing away, some companies will be transferring tens of millions of dollars.
MOST OF THE PUBLIC POLICY CHALLENGES WITH MEDICAL MARIJUANA LAWS STEM FROM THE CONFLICT BETWEEN STATE AND FEDERAL LAW, AND HERE’S A GLARING EXAMPLE OF THAT.
Ben Pollara, Florida for Care
“Most of the public policy challenges with medical marijuana laws stem from the conflict between state and federal law, and here’s a glaring example of that,” said Ben Pollara, executive director for Florida for Care, the organization that backed the campaign to legalize an expanded medicinal marijuana system in the state last year. “On the basis of how much money you’re talking about, you can’t be someone shuffling cash from bank to bank. Florida allows 25 stores [per license]. Trulieve has a dozen locations. That’s a major deal if all the sudden overnight their bank goes ‘Here’s your pile of cash, get out.’ ”
The bank’s clients were caught off-guard by the news. But they don’t expect the change to be that abrupt.
Several First Green marijuana clients say multiple banks are lining up to take the bank’s place. Trent Woloveck, president of The Green Solution National, one of the state’s marijuana operators, said the company has already found two partners willing to handle its money and accept wire transfers.
No one would name the banks that are taking on Florida's marijuana clients, saying that unlike First Green Bank, the institutions have wished to maintain a low profile.
“The industry and the patients will be fine,” Woloveck said. “First Green is giving a transition period and several other banks have already stepped up in Florida to fill the need. Medical cannabis banking has become much more accessible over the past few years; it is not nearly as burdensome as it was even a year or two ago. Thankfully, the taboo and stigma has lifted and more and more banks are ready, willing, and able to take medical cannabis funds in legal states.”