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Cannabis still cash only business as sales begin in Nevada

Posted at 6:00 PM, Jun 30, 2017

Recreational marijuana is now a reality in Nevada. But a risk remains with that new high. 

Contact 13 follows the tricky trail of cannabis cash.

The budding marijuana industry generates millions of dollars but as Contact 13 first reported nearly two years ago, conflicting federal and state laws force everyone to use cash.

That's because marijuana is still a controlled substance under federal law.  Banks are federally insured so they're not willing to take money made from marijuana sales. That keeps the new cash crop as a cash-only business. 

Customers pay for the product with green backs. Dispensaries have no banks willing to accept deposits so they then pay vendors and employees in cash. 

It's a practice that puts everyone at risk in an industry many say should be regulated to the penny.

In 2013, Nevada lawmakers tried to allow privately insured thrift banks to work with the marijuana industry. That effort went up in smoke. 

With marijuana going recreational in one of the world's top tourist destinations, dispensary operators say now is the time to get banks on board. 

"Money laundering will not occur because all of our sales are tracked," says Ben Sillitoe, CEO and co-founder at Oasis Medical Cannabis. "And as long as banks want to invest a little bit of money into the compliance side of banking our industry, there could be really profitable, new market for them to pursue. This is one of the fastest growing industries if not the fastest growing industry in this country right now."

An attorney who is familiar with the medical marijuana industry tells us all the states where it's legal are still dealing with the banking problem.  Due to banking laws, she says the only viable long term solution likely rests with the federal government.