Pot shops say tight state security rules help
The owner of the Carbondale marijuana shop that was robbed at gunpoint last month says the state-mandated security system worked flawlessly, keeping the robbers from taking far more in cash and product.
But restrictions on banking for marijuana businesses are making it nearly impossible for them to store their money, and they’re running a high security risk by carrying the cash in bulk.
“We have no banking system whatsoever locally,” said Mike Friend, owner of Sweet Leaf Pioneer, the store that was robbed Dec. 7.
Only a few banks in the state will take the risk on dealing with marijuana shops, said Dan Sullivan, owner of The Green Joint, which has shops in Glenwood Springs, Rifle and Parachute.
One of the banks trying to tap into the marijuana industry is The Fourth Corner Credit Union, and it’s now in a federal case to allow marijuana businesses access to the national banking system.
But the judge in that case has pushed back that the issue should be settled by Congress rather than the federal courts, said Sullivan. “It’s still going to be a cat and mouse game until Congress takes a stand on it, because marijuana is still a federally illegal substance.”
In lieu of the federal government loosening restrictions and allowing the marijuana shops to use the banking system, the state has been mandating beefed up security systems for the marijuana businesses.
Colorado Department of Revenue’s Marijuana Enforcement Division requires many security precautions, such as where security cameras are located, what kinds of locks and alarms are used, the rating of a marijuana shop’s safe, keeping the marijuana stored separately from the business’s cash and the processes employees take to record the business’s actions.
The security cameras themselves, while they used to be installed by just about anyone, now must be installed by certified professionals, said Friend. And the camera and other security system components must be in a secured lock box.
Over recent years, state-mandated security measures have incrementally increased, said Friend.
The Marijuana Enforcement Division also inspects marijuana shops and dispensaries’ security. The businesses are required to keep 40 days of surveillance footage at any given time.
Michael Gurtman co-owner of the newly approved marijuana business Osiris in Glenwood Springs plans to outdo even the state’s security requirements, adding features including a 24-hour guard.
Some security firms are also cropping up with armored cars to transport businesses’ marijuana and cash, he said.
In the absence of having a bank, Sweet Leaf Pioneer has incorporated pretty much all the security measures that a bank would have, said Friend.
It wasn’t enough to keep a pair of armed robbers from stealing a few thousand dollars in cash and marijuana.
But Friend said the robbery could have been much worse without the high security measures, comparing it the $45,000 in stolen equipment from Carbondale Wagner Rents shortly after the Sweet Leaf Pioneer robbery. And there’s still no word from Carbondale police on a suspect in that case.
To contrast, the marijuana shop robbers were caught the same day, said Friend.
But even with the ample security, incidents like the Sweet Leaf Pioneer robbery can’t always be stopped, said Friend.
Part of being a retail business is keeping your doors open and inviting the public, so you can’t stay on lockdown and keep everyone out, he said.
And beyond the security issue of having bulk cash, the banking restrictions cause everyday headaches for the marijuana shops. Customers can’t pay with a debit or credit card. The businesses can’t use a card for their online purchases.
“We’ve had to figure out which vendors will take cash, which ones we have to get a money order for and which ones we’ll have to use a personal checking account for,” said Sullivan.
And even with the insurance claim check from the robbery, Friend doesn’t have anywhere to cash it.
Being able to open a bank account would eliminate 90 percent of these problems, said Friend. The government should finally get on board and help this industry out, he said.
Sullivan predicted that The Green Joint would have banking sometime this year.
He also saw hope in a recent move by Congress that has largely flown under the radar. In its 2016 omnibus spending bill Congress prohibits the federal government from coming down on medical marijuana organizations or businesses licensed through their state, he said.
“It’s encouraging that Congress has said to leave the medical marijuana alone,” he said.
Sullivan predicted the rest of the country within five years will legalize at least medical marijuana, which is currently legal in 23 states.
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