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North Coast banks sniffing accounts for marijuana money

Financial institutions in the Emerald Triangle are now soldiers in the Federal war on pot, according to the Press Democrat.

Federal regulators are instructing North Coast banks to scrutinize their customers’ financial transactions for signs of money laundering and drug deals, the result of the region’s reputation for marijuana production…

Evidence of the policy emerged last month, when the largest bank in Mendocino County notified shareholders that federal banking regulators were requiring it to closely watch its accounts because the North Coast had been designated a high-risk area for money laundering…

As a result, regulators have pushed North Coast banks to install advanced equipment that allows bankers to closely monitor the transactions of all customers and report any suspicious activity to regulators and law enforcement agencies.

Full story.

  1. March 2, 2011 at 12:19 am

    “Advanced Equipment” eh? :)

    Hilarity. I’d like to see how many accounts get red-flagged over the fact that we’re a rather rural economy with some serious (legit) moneymaking businesses up here that make little to no senese. I’m sure the vendors that sold them the software/equipment compensated for our local economy and industries that make record profits regardless of our area for the last 10 years, right?

    Looking forward to the audit myself. Fun times. :D

  2. Crooked
    March 2, 2011 at 7:16 am

    Thanks for the warning.

  3. great
    March 2, 2011 at 7:24 am

    Its about time. Its time to tax these “legit” businesses and if not legit then those folks have to just deal with it.

  4. Mark Sailors
    March 2, 2011 at 7:25 am

    Indeed Josh, indeed. So my cash only pedal cab is now going to draw regulatory scrutiny? Give me a break. I take cash from people that grow pot, they spend money with me, now I am somehow the criminal? Someone had better tell the hydroponics stores they deposit a ton of pot money everyday.

  5. Anonymous
    March 2, 2011 at 8:19 am

    For starters, the money smells like pot.

  6. High Finance
    March 2, 2011 at 9:05 am

    The banks long have had rules about reporting cash deposits of $10,000 or more. The rule was expanded long ago to also include $10,000 or more over a short period of time.

    Sorry, but I cry no tears over this latest problem drug dealers have.

  7. @&$^*(&
    March 2, 2011 at 9:31 am

    No tears for drug dealers from me either, but it seems like an unwarranted search to me. Any legal types know how that works?

  8. March 2, 2011 at 9:34 am

    they are in the process of cross referencing with your tax returns. heads up, get into silver and gold.

  9. Fed up
    March 2, 2011 at 9:44 am

    How about checking out the PG&E bills? I hear about folks paying in cash for monthly bills exceeding several thousands, and actually having the nerve to apply for low income discounts which are then granted because they have no reportable income. Discraceful!

  10. Eric Kirk
    March 2, 2011 at 2:06 pm

    According to the article the banks are closing dispensary accounts to avoid the hassle. Maybe that’s the point.

    In any case, I wish they’d pursue fraud and negligence in credit policies with as much intensity. That’s part of what has thrown us into a depression.

  11. Eric Kirk
    March 2, 2011 at 2:07 pm

    they are in the process of cross referencing with your tax returns. heads up, get into silver and gold.

    Can they do that outside of a formal audit?

  12. Mark Sailors
    March 2, 2011 at 2:40 pm

    I just don’t want the money i get from pedaling drunks home from the bars to get seized because it smells like pot. That’s just not fair at all. I take people like 2 miles for 10 or 15 bucks and sometimes “ballers” tip me very well, should I fear losing that money because the guy was a pothead?.

    WTF?!?!?!?

  13. March 2, 2011 at 2:44 pm

    Don’t take the “sniffing” part literally. As noted in the article, “regulators have pushed North Coast banks to install advanced equipment that allows bankers to closely monitor the transactions of all customers and report any suspicious activity.”

    It doesn’t appear to have anything to do with how the cash actually smells.

  14. March 2, 2011 at 2:47 pm

    Read more about it at Kym’s blog.

  15. Not A Native
    March 2, 2011 at 3:22 pm

    Kinda fun, like sneaking into the kitchen at night, suddenly flipping on the lights and watching the roaches scurry. It ain’t at all about “Free the herb” its all about “Get out of jail free”. Will CLMP be airing bulletins on KMUD about which banks are sharing information today?

  16. tra
    March 2, 2011 at 3:39 pm

    I think Eric Kirk is probably onto something with the info about banks planning to close the accounts of medical cannabis cooperatives/dispensaries to avoid getting caught up in a hassle.

    But of course the Feds aren’t going after medical cannabis cooperatives, right? Isn’t that what Obama promised and Holder confirmed? But it looks like maybe this is just another way for them to go after the cannabis-medical-complex while continuing to claim that they aren’t.

    If they somehow succeed in shutting down the cooperatives and dispensaries (I wouldn’t bet on that), then, oh well, this’ll just act as yet another price support for the blackmarket economy. That would be good news for many Humboldt growers, I suppose — though not such great news for consumers who like the convenience and reliability of getting their buds from a pot club rather than on the street or from their friend’s cousin’s uncle.

  17. Anonymous
    March 2, 2011 at 8:50 pm

    The Dept of Treasury has long tracked the deposit of $10K in cash. Nothing illegal about that. Banks that are connected to the Federal Reserve System have to file those reports. The smart ones in Humboldt launder there profits through otherwise money-losing businesses. Credit Unions are still very popular because they have less restrictive reporting requirements.

  18. Anonymous
    March 2, 2011 at 10:58 pm

    Is there a reason why we hate corps on the basis we claim they aren’t taxed enough or aren’t paying their share and screw up the environment but dope growers can rake in bucks, never pay taxes and screw up our environment polluting air, stealing water and ruining our neighborhoods? I say way to go. Make banks report.

  19. Anonymous
    March 3, 2011 at 7:31 am

    Mark, you have a legit business and I think you have no reason to worry. Red flags happen when people have too much cash coming in amounts not appropriate for their job. Most businesses don’t only deal with cash. There are many checks and credit card transactions involved.

  20. Anonymous
    March 3, 2011 at 4:26 pm

    Just to let everyone know that the 10K rule is just feds. CA reviews all cash deposits over 4500 and Chase looks into all cash deposits over 3K. this is in personal accounts, not business accounts.

    info has been verify by bank employees.

    look up CA money laundering rules. they review series of deposits also. like 3k one day, 4K the next, 2K the day after are considered suspicious. they are smarter then you think.

  21. March 3, 2011 at 5:42 pm

    “…this is in personal accounts, not business accounts.”

    This sounds like a good reason to start a business.

  22. A-Nony-Mouse
    March 3, 2011 at 5:51 pm

    So Mr. Progressive, Dave Tyson, manages yet again to torpedo progress in Eureka by sending that article to every Clown Council member to be ABSOLUTELY SURE they see it. Just why it affects potential clinics in Eureka is unclear, but why else would Tyson send the article around? Eh?

    I suspect NoNoNewman, Lunkhead Lance, and Marinated Brady see this as a message from Heaven. When that crew actually DOES ANYTHING, the Heavens will part and the trumpets will sound. Don’t hold your breath!

  23. High Finance
    March 3, 2011 at 6:49 pm

    Mouse, your intellectual skills seem to be deteriorating before our very eyes.

  24. "HENCHMAN OF JUSTICE"
    March 4, 2011 at 8:10 pm

    Nah HiFi, that is the reddish streaked, electro-static foggysmoggy haze one sees that lingers in the air in particulate opaqueness. In Humboldt, Fog and smog still exists. Maybe that is why the term….”light-headed” still seems applicable.

    JL

  25. "BONGSMOKER OF JUSTICE"
    March 4, 2011 at 9:28 pm

    Duh, HighFizz, that is the reddish streaked, light-headed haze that lingers in the air one sees in particulate in Humboldt, Fog and smog, opaqueness. Maybe I still exists. That is why the term …”electro-static foggysmoggy” seems still applicable.

    LJ

  26. eurekite
    March 5, 2011 at 9:10 am

    anyone dumb enough to run large herb cash deposits through a bank without taking some precautions isn’t going to be missed.

  27. Owltotem
    March 5, 2011 at 9:17 am

    A-Nony they will do as they are told.

  28. Silver vigilante
    March 10, 2011 at 7:00 am

    Dump your pot dollars…..buy gold and silver. It’s very simple, crash the banks….make JP Morgan and friends pay. End the banker occupation of America!

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