A surge in robberies at licensed cannabis shops — including a pistol-whipping, gunshots and killings in Washington state last month — is helping fuel a renewed push for federal banking reforms that would make the cash-dependent stores a less appealing target.
“It makes absolutely no sense that legal businesses are being forced to operate entirely in cash, and it’s dangerous — and sometime even fatal — for employees behind the register,” Washington Sen. Patty Murray, the third-ranking Democrat in the Senate, said in a statement emailed to The Associated Press.
Although 18 states have legalized the recreational use of marijuana, and 37 allow its medical use, it remains illegal under federal law. Because of that, big banks and credit card companies have long been reluctant to work with the industry, leaving the businesses heavily reliant on cash and making them attractive marks for robbers.
On the annual 4/20 marijuana holiday Wednesday, Murray held a press conference at Salal Credit Union to say she will prioritize marijuana banking reform as part of her work on a conference committee that is ironing out differences in House and Senate versions of a major federal competitiveness and innovation bill.
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Murray is just one of 26 senators appointed to the conference, but cannabis industry activists said they consider her announcement an important signal that after years of work, the banking issue might finally get resolved this year, allowing financial institutions to handle marijuana money in states where it is legal without fear of federal prosecution for money laundering or other crimes.
There recently has been a massive spike in the robberies for reasons that aren't entirely clear. Dozens of cannabis businesses in the San Francisco Bay Area were hit last fall in a wave of attacks that sometimes appeared coordinated. Industry trackers in Washington state have reported at least 80 so far this year, mostly in the Puget Sound region.
While dispensaries are frequent targets for robberies, the spate in Washington is helping drive the national conversation about banking reform. Last month, a suspect shot and killed an employee at a cannabis store in Tacoma; an ID checker shot and killed a robber in Covington; Seattle police shot and killed a suspect following a robbery in Bellevue; and a robber pistol-whipped a worker at an Everett shop.
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In the last few days, police have arrested a 15-year-old boy and a 16-year-old boy in the killing of employee Jordan Brown, 29, at Tacoma's World of Weed. Authorities said the pair were responsible for at least 10 other armed robberies, including several at pot shops.
“The number of these robberies is shocking,” said David Postman, the chairman of the Washington Liquor and Cannabis Board.
The board in the past month has held public safety discussions with retailers, recruited law enforcement to talk to retailers about best practices, and worked with state financial regulators to highlight local banks and credit unions that work with the industry as well as third-party vendors that cannabis retailers that conduct cashless phone transactions.
Marijuana shops that can afford it have hired private security guards, sometimes at costs of more than $50,000 a month for a round-the-clock detail, said Adán Espino, executive director of the Craft Cannabis Coalition, which represents more than 60 retail stores in Washington. Some of the businesses have tried to hire guards, only to find that security companies are completely booked, he said.
Espino said he's pushing for state lawmakers to give tax credits to cannabis stores that have to shell out money for security.
Mary Mart, a cannabis outlet in Tacoma, hired armed security in March after it was robbed twice in two months — including, police say, by the two teens who days later killed Brown. Budtender Amara Barnes, who was not present for either robbery, said she and other employees had their hours cut to help offset the cost.
“It's scary. I had worked here for four years without any kind of incident,” Barnes said. “To have a couple kids come in and do that it really shakes the confidence."
Officials and industry advocates say hiring security and training employees on best practices won't solve the problem the way federal approval of cannabis banking would.
Colorado Democratic Rep. Ed Perlmutter introduced the SAFE Banking Act in 2013 soon after Washington and Colorado became the first states to legalize the regulated sale of marijuana. The bill would keep federal regulators from penalizing banks that work with licensed cannabis businesses.
The House has passed it half a dozen times with bipartisan support, but it has never passed the Senate, where it has 42 co-sponsors, including nine Republicans. Majority Leader Chuck Schumer, a Democrat, has insisted that he would prefer to see federal legalization of marijuana, along with measures to redress harms caused by the war on drugs, before addressing banking.
Schumer, however, recently announced that his marijuana legislation would not be ready to introduce this month as originally planned.
Supporters of fixing the banking problem first now see an opportunity, especially with Murray announcing that she will prioritize it in her work. David Mangone, director of policy and government affairs for The Liaison Group, a Washington, D.C.-based cannabis lobbying firm, called news of Murray's statement “a reasonably big deal.”
In a letter to Schumer and other senators Tuesday, Perlmutter cited the robberies and deaths in Washington state in support of approving banking reform as soon as possible. He called the banking reform “an immediate solution to get cash off our streets and ensure state-legal, legitimate businesses can operate like any other type of business."