The feds have offered guidelines for banks to handle the growing marijuana business, but many are still reluctant to cash in.
Colorado already has raked in $184 million in tax revenue from marijuana, but the business still is run primarily on cash.
John Heasley with the Texas Bankers Association says banks are conflicted about handling accounts based on illegal drugs.
“Even though regulators have issues guidelines, because of anti-money laundering laws and scrutiny, its been a very contentious subject,” Heasley tells KTRH News.
“Their counsel is telling them even possession, transaction or assisting in the sale of marijuana is still contrary to federal law, so they might be subject to prosecution and additional scrutiny,” he says.
There are other concerns as well.
“Some of the bankers say they've had a very unique pungent odor associated with the cash deposits from those banks that have actually dealt with dealers,” says Heasley. “They've even had to segregate cash used in those businesses from other retailers."
Still, Heasley says not only is better record keeping needed as states collect the tax revenue, there's also a danger to running cash-only businesses.
However, despite Colorado's booming tax revenue, Heasley believes Texas is still years away from loosening it's stance on marijuana.