Comments are based on this blog from the Canna Law Blog.
We are all Tier III. What!?!?!
Under Federal law, as we have discussed, banking to the cannabis industry is highly regulated for non-federal banks and prohibited for federal ones. Under the FinCon Memo, issued seven years ago (that a long time in cannabis years), the Treasury Department issued rules for heightened scrutiny to prevent “money laundering) relating to “know-your-customer” (KYC).
The cannabis lending industry has interpreted this as a three-tiered standard for lending scrutiny: Tier I – Plant Touching; Tier II – Relies on MJ for a majority of its revenue; and Tier III – MJ not relied upon for majority of revenue.
So, as the article highlights, we are ALL TIER III. The electric utility that powers the grow, the steel manufacturer that made a the parts for distillation equipment, the accountant that does the tax returns, the federal government (cannabis companies pay federal income taxes big time; “crime”pays for Uncle Sam), and states that use cannabis tax dollars to fund the needs of it citizens.
So, it’s time to move on. The cannabis industry is one of the highest growth industries in the US. It touches us all..even non-consumers. It’s inexorable. I suppose I’m part of the vanguard at Sweet Leaf Madison Capital – stepping into the breach where most banks dare not go. Funny, I don’t feel like a martyr, revolutionary or outlaw. I feel like the same boring finance guy and attorney just trying to do a job. Maybe in time, with SAFE banking still on the table, that’s what I’ll become. How wonderfully mundane!!
#cannabis #taxes #finance #banking #job #law #sweetleafmadison