Most Of The Banks That Are Active Are Small, Either Legacy Banks, Meaning Old Banks, That Have Been Around Forever, But For Whatever Reason They Have One Or Two Branches, And The Officers Can Be Confident That The Bank Knows The Businesses And Has A Proper Customer Identification Protocol Activity In Place,” Schultz Said.

He says this concept is not unique to the industry—banks are required to know all their customers in this way. Schultz points out that many businesses in the country today receive money from the sale of marijuana, and there are no effects, so in the case with MPP, the closing of their accounts is probably due to PNC’s size. “I’m not surprised that a large bank chose to withdraw from being anywhere proximate to this business, and I’m not surprised either that otherwise nothing else is happening. That is to say, it’s not like there are 10 other stories today about banks pulling out of the industry,” Schultz said. “PNC is too unlike the typical banks operating in the industry, which are typically small banks whose management is very close to customers and who can very easily understand everything we’re doing.” Schultz adds that small banks can make marijuana business accounts a priority, while big banks cannot. For bigger banks, he says, they have enough trouble making sure that their CIP is compliant without taking on the complicated regulations of state-legal marijuana businesses. “Most large banks with thousands of branches have not historically been active in banking marijuana businesses. Most of the banks that are active are small, either legacy banks, meaning old banks, that have been around forever, but for whatever reason they have one or two branches, and the officers can be confident that the bank knows the businesses and has a proper Customer Identification protocol activity in place,” Schultz said. “In some sense, the surprise is that PNC was ever doing this at all.” Schultz said he hopes the industry continues to move forward and that marijuana businesses can eventually get away from being cash-only, which would make it easier for them to pay their taxes properly and provide them with a record of financial activity. “I think having this industry in the banks helps with compliance,” he said. “Moving this industry out of our banks is not a good thing.” Representative Ed Perlmutter (D-CO) marijuana introduced a bill in April called The Secure and Fair Enforcement Banking Act, which would prevent federal regulators from terminating banks’ federal deposit and share insurance solely because they provide financial services to legitimate cannabis businesses.

To read more visit http://www.cannabisbusinesstimes.com/article/pnc-closes-mpp-account-comments/

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