Cannabis banker Sundie Seefried is drowning in a sea of paperwork.
And that — she told a Las Vegas audience — is why her financial institution and other banks have to charge high fees to work with marijuana companies.
Seefried said her Partner Colorado Credit Union had to file 226 reports with regulators for its 33,000 members.
However, Safe Harbor — the credit union’s subsidiary that serves 220 cannabis-related companies — had to file over 7,000.
“When you ask me why banking is expensive — what you are really paying for are all the bodies it takes to file 7,000 reports,” she told hundreds of cannabis industry professionals at the MJBizCon conference.
Banking was again a major topic at MJBizCon, which attracted more than 26,000 people this year. The three-day show ended Friday at the Las Vegas Convention Center.
Seefried said federal and state regulators have carried out nine joint inspections of her credit union over the past three and a half years, compared with the industry standard of three.
“They will send 20-plus examiners into our small credit union to make sure we are not violating the Bank Secrecy Act. That is a show-stopper for a lot of banks and credit unions,” she said.
While medical cannabis sales have been legalized by 33 states and recreational sales by 10, such sales are still prohibited under federal law.
That makes it difficult for cannabis businesses to open checking or savings accounts in most financial institutions, leaving them holding cash to pay employees and suppliers.
Safe Harbor processed $160 million last month, she told the crowd, which is an annual run rate of nearly $2 billion.
“Every one of those dollars has to be proven to be a valid, legitimate dollar, and that is very labor-intensive,” she said. “It is