The legal marijuana industry made more than five billion dollars in 2015 and wherever marijuana is sold in the United States cash is the only accepted method of payment. This is coupled with the fact that it’s difficult (if not impossible in some cases) for pot shop owners to find banks willing to accept their money. Businesses have to pay taxes and a dispensary is no exception; they also do this with cash. This creates a situation where a lot of money is floating around with no real way to protect the individuals who purchase it or the businesses who sell it.
Marijuana is federally illegal which is why banks will not take money from businesses who sell cannabis. Banks are worried their assets will be seized and they will be prosecuted under federal statutes. This is fine for the banks, but leaves the pot shop owners with tens of thousands if not hundreds of thousands of dollars in cash alongside equally valuable marijuana, making them prime targets for robberies.
On June 8, an owner of a dispensary in California shot two would be robbers multiple times as they came through the door of his business. On June 19, Travis Mason was killed in Colorado working as a security guard at a pot shop. On June 23, another security guard was killed, this time in California. The list of armed robberies doesn’t end there, but the key takeaway here is that where there are large sums of cash people will try and take them.
The businesses aren’t the only ones at risk; consumers have to bring
their own cash. While some dispensaries will install ATMs in their stores to circumvent this, the customer leaves with marijuana, a substance just as valuable as cash and just as easy to steal. Just follow someone home leaving a dispensary.
At some point the cash has to leave the business to go somewhere. From deposits in the few banks that will hold your money to having to pay your taxes, the money has to physically go somewhere. In California, there are designated cash only days in which businesses can bring in their large sums of cash to pay their taxes at their local tax collection agency. It is estimated that over 200 million dollars were used to pay taxes in 2015, all in paper money.
Those issues aside, the real problem is the varying systems in place between states. Oregon allows out of state investors to participate in their marijuana industry while Alaska does not. Michigan has passed many laws that will properly tax cannabis and other products derived from it; Ohio legalized medical marijuana but already has towns prohibiting its sale for one year. The tax codes in California and Colorado change multiple times every year. Without cohesive elements bringing these systems together the business owner is left to fend for himself amongst a mountain of legalese.
Law makers have acknowledged that this is a problem that needs to be addressed. Until either the DEA classifies marijuana differently or the federal government passes legislation regulating marijuana we may be buying cannabis in cash for a long time to come.