Twenty-two states and the District of Columbia have legalized the use of medical marijuana to date. Earlier this year, the State of Washington and Colorado legalized the recreational use of cannabis for adults within their jurisdictions.
Polls suggest that a sizeable percentage of our population believes this is, and should be, just the beginning of a nationwide wave of marijuana legalization. However, deeper research into the issue of marijuana legalization indicates that the vast majority of opinion-holders are unaware of the complexities associated with making this newly legalized industry financially accountable -- to the regulators who are responsible for its oversight, as well as to the public at large.
Electronic Funds Transfer (EFT) is a key tool for achieving financial accountability. Regulators vested with the responsibility to oversee the new marijuana industry would do well to require EFT between all the tiers, i.e., growers and processors, distributors, and retail dispensaries, so that regulators can receive reports from the EFT providers and better audit the legitimacy and compliance of industry members. It works well for the heavily-regulated alcohol industry, and has the potential to deliver the same positive benefits for the growing cannabis market.
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This article is published in the September 2014 issue of Fintech Focus. For more information, click here.
About the Author: Richard M. Blau leads GrayRobinson’s Regulated Products Practice Group, focusing on the laws that govern the manufacture, importation, distribution, marketing, sale and consumption of beer, wine, distilled spirits and other licensed products.