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Colorado OKs financial services co-ops for pot sellers

By CNN Staff
updated 8:56 AM EDT, Thu May 8, 2014
Customers wait in a long line for their turn to buy recreational marijuana outside the LoDo Wellness Center on Wednesday, January 1, in Denver. Colorado is the first state in the nation to allow retail pot shops. Customers wait in a long line for their turn to buy recreational marijuana outside the LoDo Wellness Center on Wednesday, January 1, in Denver. Colorado is the first state in the nation to allow retail pot shops.
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Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
Retail pot shops open in Colorado
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STORY HIGHLIGHTS
  • Gov. John Hickenlooper is expected to sign the bill, his office says
  • Banks have been "reluctant" to do business with marijuana sellers due to federal law
  • Pot sellers are often forced to operate on a cash-only basis, which invites crime

(CNN) -- Colorado lawmakers on Wednesday approved a bill that would create financial services cooperatives specifically for licensed marijuana businesses in the state.

Colorado Gov. John Hickenlooper is expected to sign the bill, according to his office.

Guess which politicians have tried drugs

The legislation comes three months after the Justice Department issued rules for the first time allowing banks to legally provide financial services to marijuana merchants.

Because marijuana is illegal under federal law, banks have been "reluctant" to provide services to licensed pot sellers, according to the bill, HB 1398.

As a result, these businesses often operate on a cash-only basis, a practice that Hickenlooper calls "an invitation to corruption and criminal activity."

U.S. Attorney General Eric Holder said in January that forcing marijuana businesses to be cash businesses, because they can't access banks, is a public safety problem.

"Huge amounts of cash, substantial amounts of cash, just kind of lying around with no place for it to appropriately deposited is something that would worry me from just a law enforcement perspective," he said.

Colorado became the first state in the nation to legalize the sale of recreational marijuana, allowing pot stores to open for business on January 1.

Under the bill, cannabis credit co-ops cannot refer to themselves as credit unions or banks and do not need deposit insurance. The co-ops will be subject to taxation, according to the bill.

Cannabis lovers take Denver's 420 weekend to new highs

Banks cleared to accept marijuana business

CNN's Carma Hassan and Evan Perez contributed to this report.

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