Legislation (SB 75) has been introduced in the Colorado Senate authorizing the creation of a financial cooperative modeled on credit unions to serve the medicial marijuana industry.
The bill authorizes a group of medical marijuana licensees or registered medical marijuana patients or both to form a financial cooperative subject to all of the regulatory provisions for credit unions. The common bond is medical marijuana licensees or registered patients.
It has a once a member, always a member provision stating that a member of a financial cooperative who is no longer licensed or registered may still remain as a member of the cooperative.
The legislation requires the financial cooperative to obtain share insurance from the National Credit Union Share Insurance Fund (NCUSIF), a comparable non-federally backed insurer, or self-insure. Currently, the only provider of private share insurance is American Share Insurance (ASI).
However, the bill bans the proposed financial cooperative from calling itself a “credit union.”
This proposed financial cooperative contemplated by this bill is a credit union except in name.
If it looks like a duck, quacks like a duck, and waddles like a duck, it's a duck. Or should I say a credit union.
Read the bill.
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Looking at the story from another angle: Banks in the sixteen states where medical marijuana is permissible are caught between serving an activity allowable in these states, but illegal under federal law. Banks have fully served the credit needs of the US marijuana industry for years, but recently universally pulled back under pressure from federal officials, and the dispensaries have no place to go for financial services. FDIC refuses to rule on the matter, in part because if illegal for a federally insured institution under federal law, banks and bankers in many states could face prosecution for their past role as an active part of the criminal drug trade in this nation.
ReplyDeletePerhaps the credit union angle should be the question, “Might someone call for the criminal prosecution of bankers, (under the premise if illegal today it was illegal yesterday,) to help clean up the financial system?” After all, if it looks to be in the business circle of marijuana dispensary ducks, quacks like a duck, and waddles like a duck, records show it could have been a bank.