By Ray Birch
ARVADA, Colo.—Sundie Seefried has always said that taking on pot banking is not for the faint of heart. Now, with Attorney General Jeff Sessions’ decision to rescind an Obama Administration policy of non-interference with marijuana-friendly state laws, there are some new palpitations.
But Seefried, who heads $352-million Partner Colorado CU here, which created a CUSO, Safe Harbor Private Banking, specifically for the cannabis industry, told CUToday.info that the decisions by the Justice Department won’t impact the credit union’s current plans to serve legal marijuana businesses in Colorado, as well as to work with credit unions across the country to establish pot banking programs.
Credit unions that serve the marijuana industry in states where cannabis is legal have been walking very fine lines between state laws that permit marijuana and federal law, which does not. With Sessions saying the Justice Department’s new position will be to allow federal prosecutors where marijuana is legal to decide how aggressively to enforce federal law, an already murky area has become murkier—and potentially more threatening—for those CUs and CUSOs serving the cannabis industry. The previous policy, established under the Obama Administration, generally barred federal law enforcement officials from interfering with marijuana sales in states where the drug is legal.
Confident and direct in her response, Seefried told CUToday.info that the Justice Department’s move will not change anything at Safe Harbor Private Banking now.
“Right now, it’s business as usual,” she said.
But the CEO acknowledged the decision is concerning.
“The changes in guidance should and do concern us,” she said. “However, the Cole Memo was not written for financial institutions, the FinCEN guidelines are our guidance. Until we hear from FinCEN that they oppose banking the funds, we will continue.”
Seefried is very committed to the program because she understands how providing legal pot businesses with banking services is a critical community service. It keeps marijuana businesses from handling large amounts of money, which encourages crime and can lead to people being injured and killed.
“Cannabis banking is a service to our community,” Seefried said. “Colorado is safer today with this money being banked. We banked nearly $1 billion in 2017 and we are sure to exceed that in 2018. Safety drove my board and myself to this initiative and it now keeps us focused on the same goals. It was illegal when we started, it is still illegal today. One must have the fortitude to take on such a challenge. It’s not for the faint of heart.”
Wait And See
Will Sessions’ decision prompt some banks and CUs to exit cannabis banking and prevent others from moving forward?
“I think, like us, most are waiting to see what will happen following the revocation,” Seefried said. “We are governed by FinCEN regulations and protected to some extent under the Rohrabacher-Blumenauer Amendment. The Cole Memo, which was rescinded, was more guidance to the businesses in the cannabis space.”
Seefried thinks many banks and credit unions will stay the course even in the face of the Justice Department’s decision, simply because they are accustomed to pot banking being a business that has always carried challenges. She also said that legal pot business owners are fighters, and won’t be deterred by the attorney general’s move.
“The industry has faced uphill battles since marijuana banking started. This is group of strong, determined entrepreneurs that won’t give up easily,” Seefried said. “They are used to two steps forward and one step backward. They are a formidable group that will stay the course. As long as they see a credit union willing to keep their cash off the streets, they will support our effort.”
As CUToday.info reported, Seefried, her credit union and the Safe Harbor Private Banking have received national and global attention following the recision of the pot memos, including on the BBC. Most recently, Seefried and Partner Coloardo were the subject of a lengthy profile in the New York Times, as CUToday.info reported here.
Seefried said all the attention has been “very strange to me. It becomes one of those moments where I pause and wonder what have I done? Managing interviews as well as public speaking do not come naturally to me and I always have a lingering fear that I might say the wrong thing and it lives forever in infamy. One doesn’t take up a career in banking for the fame appeal.”
But Seefried acknowledged that the media attention further emphasizes the importance of the credit union’s work.
“The issue is big, and it’s global,” she said. “I’m not convinced it is really just about the cannabis so much as it is about anti-money laundering and bank secrecy laws. Those, too, are global banking issues that now have one more facet added to the mix—cannabis. In my opinion, it is really about pulling an industry out of the ‘black market’ status and into a legitimate status.”
Seefried believes all the media attention will help Safe Harbor Private Banking grow.
“The interest in solving the banking problem utilizing the Safe Harbor Services options is growing every day. I don’t think my team and I realized how global the need was and that in return, how big a solution needed to be to help. Being a credit union professional makes it difficult to not help other financial institutions,” said Seefried, noting that Safe Harbor educates other financial institutions on how to effectively and safely serve legal cannabis businesses.
Seefried said she is getting a lot of calls lately.
“It is now very difficult for me to answer the phone and I really try to be responsive, but sometimes it is at the expense of my family and definitely my friends,” she said. “But all of the attention certainly changes things. It changes interactions all around me, and yet I am still the same—that’s the strangeness that has me looking sideways. My board, team and I have always simply looked at this project as one more credit union just doing the right thing.”