{"id":2272,"date":"2016-06-10T14:46:08","date_gmt":"2016-06-10T14:46:08","guid":{"rendered":"https:\/\/picb-us.com\/?p=2272"},"modified":"2023-08-14T20:53:58","modified_gmt":"2023-08-14T20:53:58","slug":"dont-let-your-profits-go-up-in-smoke","status":"publish","type":"post","link":"https:\/\/picb-us.com\/dont-let-your-profits-go-up-in-smoke\/","title":{"rendered":"Don\u2019t Let Your Profits Go Up In Smoke"},"content":{"rendered":"

[vc_row][vc_column][vc_column_text]<\/p>\n

DON\u2019T LET YOUR PROFITS GO UP IN SMOKE<\/strong><\/span><\/h2>\n

By<\/em><\/span> Benjamin Kelly<\/em><\/span><\/strong>
\nLovejoy & Kelly PS<\/span><\/em>
\nSeattle, WA<\/span><\/em><\/p>\n

Washington State\u2019s legalization of marijuana in November 2012 opened up a slew of possibilities for businesses and entrepreneurs, both experienced and budding. Overnight, there was need and opportunity for pot-related businesses from retailers to suppliers to growers. Many rushed to fill the void, and a multitude of new businesses were formed.<\/p>\n

\"pot\"But those who did wade in encountered many obstacles. Principal among the hurdles was marijuana\u2019s continued status as a Schedule I drug under federal law, illegal for any purpose.\u00a0 As a consequence of dealing in what the federal government deems an illegal narcotic, pot sellers found that banks, wary of violating drug laundering laws, were unwilling to take money from them.\u00a0 Without access to financial institutions, the new businesses were rendered almost entirely \u2018cash only.\u2019<\/p>\n

A cash-only business presents several risks for credit-issuers.\u00a0 Cash is very difficult to locate relative to other types of assets.\u00a0 The proverbial (or actual) money-in-the-mattress leaves no trace and cannot necessarily be accounted-for by a third party.\u00a0 It is unlikely to be captured in a garnishment, and no independent party can provide a statement of deposits and withdrawals.<\/p>\n

So, what can a credit-issuer do to protect itself when extending credit to a pot-based business?\u00a0 As always, due diligence is key.\u00a0 A credit-issuer must take stock of a company\u2019s available assets, and the assets of any principals. One or more of those principals should be required to sign a personal guarantee.\u00a0 A principal is more likely to have real property or other locatable assets than their cash-only business.\u00a0 Be sure that your application captures the type of information that will be helpful in any later, post-judgment efforts.<\/p>\n

Legalized marijuana is fast becoming big business. There are indications that more and more banks are willing to accept money from pot-related companies. However, the industry remains disproportionately cash-only.\u00a0 Creditors must be aware of this fact and should identify and take the necessary precautions so that they do not get left holding the bag.<\/p>\n

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For more information <\/em><\/span><\/h2>\n

please contact any PICB staff member at <\/em><\/span><\/h2>\n

847-265-0400 or
\n<\/em><\/span><\/h2>\n

email us at info@wordpress-808542-3147800.cloudwaysapps.com<\/a><\/em><\/span><\/h2>\n

[\/vc_column_text][\/vc_column][\/vc_row]<\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"

[vc_row][vc_column][vc_column_text] DON\u2019T LET YOUR PROFITS GO UP IN SMOKE By Benjamin Kelly Lovejoy & Kelly PS Seattle, WA Washington State\u2019s legalization of marijuana in November 2012 opened up a slew of possibilities for businesses and entrepreneurs, both experienced and budding. Overnight, there was need and opportunity for pot-related businesses from retailers to suppliers to growers.…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"_links":{"self":[{"href":"https:\/\/picb-us.com\/wp-json\/wp\/v2\/posts\/2272"}],"collection":[{"href":"https:\/\/picb-us.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/picb-us.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/picb-us.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/picb-us.com\/wp-json\/wp\/v2\/comments?post=2272"}],"version-history":[{"count":18,"href":"https:\/\/picb-us.com\/wp-json\/wp\/v2\/posts\/2272\/revisions"}],"predecessor-version":[{"id":9725,"href":"https:\/\/picb-us.com\/wp-json\/wp\/v2\/posts\/2272\/revisions\/9725"}],"wp:attachment":[{"href":"https:\/\/picb-us.com\/wp-json\/wp\/v2\/media?parent=2272"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/picb-us.com\/wp-json\/wp\/v2\/categories?post=2272"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/picb-us.com\/wp-json\/wp\/v2\/tags?post=2272"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}