Despite hollow gestures by the federal government that suggest they are willing to allow the banking industry to work with companies that in the marijuana industry, a recent application denial of a Colorado credit union by the nation’s centralized banking system implies a different attitude altogether.
The Fourth Corner Credit Union in Denver applied last year for a “master account’ with the Federal Reserve that would have created a go-to banking establishment exclusively for the state’s cannabis industry. However, after several months of deliberation, the feds ultimately denied the credit union permission to begin doing business like the rest of civilized America.
Not only would this first-of-a-kind banking option have provided marijuana businesses with a place to deposit millions of dollars in cash revenue, but it would have also allowed cultivation operations and dispensaries to seek out loans and other vital financial solutions to stimulate growth. Yet, after submitting to months of grueling inquiries from the Fed, the credit union was shot down.
However, the decision is not a finale for the credit union. According to the New York Times, Fourth Corner Credit Union, which has the support of Colorado Governor John Hickenlooper, filed a federal lawsuit against the banking system on Thursday, insisting that the cannabis trade be allowed “equal access” to the centralized bank of the United States.
Mark Mason, an attorney instrumental in the creation of the credit union, claims that throughout the entire application process, the Fed was searching for a clever way to deny their application. Now, the organization plans to let a federal judge, well versed in “applying the law,” make that decision.
“The Fourth Corner Credit Union (“TFCCU”) sued the Federal Reserve Bank of Kansas City and the National Credit Union Administration in federal court in Denver to get a fair and impartial hearing on its request for a master account,” Mason said in a statement.
Overall, Mason says that the Federal Reserve’s own rules do not offer any guidance as to who qualifies for a master account, which he believes gave them a free license to treat the credit union unfairly.
Fourth Corner is recognized as a legitimate operation in the state of Colorado, but it needs a master account before it can open for business.