Pot Industry Cash Causing Headaches, Concerns in Sacramento
With Sacramento’s marijuana industry coming under intense scrutiny, concerns over the cash-heavy nature of the business are once again taking center stage.
As the Sacramento Bee reports, it’s not uncommon for business owners to haul backpacks or trash bags of cash into city offices to pay taxes and other fees. This isn’t just inconvenient; it has raised fears about fraud and money laundering, all of which are easier to accomplish in the absence of paper trails.
“Keeping it in the dark, keeping it in cash, it creates a lot of vulnerabilities,” said Lindsay Robinson, executive director of California Cannabis Industry Association. “It definitely allows for unsavory activity to happen.”
Sacramento has learned that the hard way. The city’s cannabis industry is now at the center of bribery allegations and featured in an alleged campaign finance scheme involving Ukrainian nationals.
But raising concerns and actually being able to address them are two different things. Despite efforts from legislators such as Sen. Bob Herzberg of Van Nuys, meaningful banking reform that would propel banks to work with the cannabis industry without fear have failed to materialize.
Herzberg is currently working on a new bill. So is the U.S. Congress. Until then, cash — and all the unscrupulousness that comes with it — is king.