02/04/2025
I am James Inzerillo, a lifetime financial services executive specializing in funds transfer, Bank Secrecy Act and all applicable AML Compliance Laws.
To ensure the success of opening up compassionate cannabis dispensaries,the ability to have a cash clearing account with a federally chartered institution and be fully compliant with all required objectives is an absolute must.
Individualized risk and compliance strategies to ensure that companies maintain regulatory safety and soundness tying these also to the business objectives. James can help you avoid any crisis BUT will also enable you to navigate through a crisis.James will assist your organization to quickly get up to speed and be available whenever the need arises for future consultation.
With the advent of many compassionate cannabis dispensaries opening in the US and Canada and major players in the Beer,Soda and To***co markets making large investments in cannabis growers, there is a major need for all of these concerns to have the right people fully versed in cash handling and compliance to ensure their success and overcome US DOJ objections to their businesses.
The opening article discusses the operational and legal issues with compassionate cannabis dispensaries getting cash clearing accounts with federally chartered banks. My first employer,Manufacturers Hanover Trust taught me one fact that never gets old-Don't be part of the problem,be part of the solution.
The second part of the article will begin to show that I can help these dealers meet DOJ legal concerns so that they can obtain a cash account to manage their cash.What I will do about it is use my knowledge to see that not only the dealers business needs are met but also the government compliance requirements are also met.
James Inzerillo
1676 59th. Street
Brooklyn,NY 11204
347-374-4305
The Department of Financial Services is aware, however, that the unsettled legal environment at the Federal level has discouraged institutions from providing financial services to companies with medical ma*****na or industrial h**p operations. This guidance is intended to clarify the regulatory landscape and encourage New York State-chartered banks and credit unions to offer banking services to these New York businesses. Institutions prepared to apply sound practices of customer due diligence and transaction monitoring, BACKGROUND Lack of Access to Regulated Financial Services Because ma*****na currently is still listed on Schedule I under the Federal Controlled Substances Act, medical ma*****na and industrial h**p-related businesses operating in accordance with New York State laws and regulations continue to have difficulty establishing banking relationships at regulated financial institutions. The ability to establish a banking relationship is an urgent issue today for the legal cannabis industry. So long as it remains difficult to open and maintain bank accounts, the industry will largely rely on cash to conduct business and operate. These limitations create unique burdens for legal ma*****na businesses. For example, companies pay employees with envelopes of cash, carry bags containing thousands of dollars to purchase money orders, and some pay taxes in cash. It also has been reported that some businesses have opened bank accounts through holding companies or use of personal bank accounts. Forcing medical ma*****na and industrial h**p businesses to operate solely with cash creates a public safety issue, as cash intensive businesses and their suppliers, employees and customers become targets for criminals. Large amounts of cash distributed outside the regulated banking system is unacceptable and creates risks to the companies, and their employees and business partners. Further, large scale cash operations impede tracking funds for tax and anti-money laundering purposes. None of this is necessary. Positions taken by the federal government are only exacerbating these problems, rather than remedying them.
Registered Organizations are required to track and trace all medical ma*****na manufactured and sold, from seed to sale. NYDOH has full access to these data and frequently audits such data to ensure strict compliance with all New York applicable laws and regulations. NYDOH retains the authority to revoke a Registered Organization’s registration at any time for failure to meet New York State's regulatory requirements.
Federal law does not specifically address medical ma*****na, or its benefits. The federal Controlled Substances Act (the “CSA”) makes it unlawful5 to manufacture, distribute, or dispense, or possess with intent to manufacture, distribute or dispense a controlled substance. Ma*****na is listed on Schedule I of Section 812 of the CSA
In recognition of the on-going expansion of legalization of ma*****na in many States, both the U.S. Department of Justice (the “DOJ”), and the Financial Crimes Enforcement Network (“Fincen”) had issued guidance to assist financial institutions in providing services to ma*****na related businesses. However, DOJ’s 2013 memorandum from Deputy Attorney General James M. Cole (the “Cole Memo”) 6, which had provided detailed guidance to law enforcement and federal prosecutors to focus enforcement resources on conduct that raised threats of criminal harm over and above merely operating in accordance with State law, was recently withdrawn by U.S. Attorney General Sessions. The Cole Memo had concluded that “Outside of [specified] enforcement priorities, the federal government has traditionally relied on states and local law enforcement agencies to address ma*****na activity through enforcement of their own narcotics laws.” Notably, the Fincen guidance, issued in 2014, has remained in effect. That guidance clarifies Bank Secrecy Act (“BSA”) expectations for financial institutions that provide financial services to ma*****na-related businesses, and details how to provide services consistent with BSA obligations. These principles are the same principles applicable to all banking relationships. In issuing the guidance, Fincen sought to enhance the availability of financial services for, and the financial transparency of, legal ma*****na-related businesses. The Fincen guidance instructs that in assessing whether to engage in a banking relationship with a ma*****na-related business, required due diligence includes: (i) verifying with the appropriate State authorities whether the business is duly licensed and registered; (ii) reviewing the license application (and related documentation) submitted by the business for obtaining a State license to operate its ma*****na-related business; (iii) requesting from State licensing and enforcement authorities available information about the business and related parties; (iv) developing an understanding of the normal and expected activity of the business, including the types of products to be sold and the type of customers to be served (e.g., medical versus recreational customers); (v) ongoing monitoring of publicly available sources for adverse information about the business and related parties; (vi) ongoing monitoring for suspicious activity, including for any of the red flags described in the Fincen guidance; and 6 Guidance Regarding Ma*****na Enforcement (August 29, 2013). Page 5 of 10 (vii) refreshing information obtained as part of customer due diligence on a periodic basis and commensurate with the risk. The guidance further provides that financial institutions considering providing financial services to ma*****na-related businesses should consider whether it implicates one of the Cole Memo priorities or violates State law. The guidance also provides instructions concerning the filing of suspicious activity reports (“SARs”). A financial institution that provides financial services to a ma*****na-related business that it reasonably believes, based on its customer due diligence, (i) does not implicate one of the Cole Memo priorities and does not violate State law, should file a “Ma*****na Limited” SAR; or (ii) implicates one of the Cole Memo priorities or violates State law, should file a “Ma*****na Priority” SAR. If a financial institution deems it necessary to terminate a relationship with a ma*****na-related business in order to maintain an effective anti-money laundering compliance program, the institution should file a SAR and note in the narrative the basis for termination. On January 4, 2018, Attorney General Jeff Sessions issued a memorandum to all U.S. attorneys rescinding the various memoranda related to enforcement of federal ma*****na laws, including the Cole Memo. As noted, the Fincen guidance remains in effect. Indeed, in the wake of the General Sessions’ rescission of the Cole Memo, members of Congress have advocated for retaining the Fincen guidance. A bipartisan group of 31 members of the House of Representatives and a bipartisan group of 15 Senators have sent letters to Fincen encouraging Fincen to continue following its 2014 guidance and to continue supporting banking infrastructure and access The guidance also provides instructions concerning the filing of suspicious activity reports (“SARs”). A financial institution that provides financial services to a ma*****na-related business that it reasonably believes, based on its customer due diligence, (i) does not implicate one of the Cole Memo priorities and does not violate State law, should file a “Ma*****na Limited” SAR; or (ii) implicates one of the Cole Memo priorities or violates State law, should file a “Ma*****na Priority” SAR. If a financial institution deems it necessary to terminate a relationship with a ma*****na-related business in order to maintain an effective anti-money laundering compliance program, the institution should file a SAR and note in the narrative the basis for termination. On January 4, 2018, A to financial institutions for businesses that are operating in accordance with State and local law and abiding by the stated factors in the Fincen guidance. These letters note that Fincen’s stated priorities have allowed legal ma*****na-related businesses to conduct commerce more safely through financial institutions which reduces the use of cash, improves public safety, reduces fraud, and provides for regulatory oversight through suspicious activity reports.
I,James Inzerillo,a lifetime financial services expert have created an outline for a course which will enable dispensary management and its staff to be as close too 100 percent compliance with all local,state and federal requirements including New York State chartered bank or credit union complies with the requirements of the 2014 Fincen guidance, the guidance and priorities set forth in the Cole Memo, and subject to the institution’s own evaluation of the risks associated with offering products and services and its ability and systems to effectively manage those risks – as our institutions do with regard to all their banking relationships. It is incumbent upon the dispensary to be equally cooperative with their Financial institution on this for obvious reasons.
In addition,this course will enable the dispensary to separate the assets of the business from its personal assets by reconciling all cash received is equal to all cash disbursed through using the Federal Reserve Liquidity ratio
Cash_Operational asset
Credit Cards,Money orders- Non-operational assets
And coding the sale of state sponsored legal and illegal products and non-state sponsored legal and illegal sale products
The guidance also provides instructions concerning the filing of suspicious activity reports (“SARs”). A financial institution that provides financial services to a ma*****na-related business that it reasonably believes, based on its customer due diligence, (i) does not implicate one of the Cole Memo priorities and does not violate State law, should file a “Ma*****na Limited” SAR; or (ii) implicates one of the Cole Memo priorities or violates State law, should file a “Ma*****na Priority” SAR. If a financial institution deems it necessary to terminate a relationship with a ma*****na-related business in order to maintain an effective anti-money laundering compliance program, the institution should file a SAR and note in the narrative the basis for termination.
In regard to the preceding paragraph.the course will enable dispensaries to meet all of the above SAR requirements AND dispensaries will be able to comply with FINCEN guidance including the Cole Memo and Bank Secrecy Act
compliance and SAR compliance
It is an ABSOLUTE MUST-all cash received has to be reconciled with all cash disbursed
I am a single contributor.I am also looking for funding to sponsor this within NY State and I will discuss this with you. I CAN NOT do this on my own
Thank You
James Inzerillo
1676 59th. Street-Apt. 1
Brooklyn NY 11204
Tel. H: 1-347-374-4305
C: 1-917-826-5042
