California's Exploding Cannabis Industry Has a Surprising Problem With Cash

The cannabis industry in California continues to flourish. But, those doing business in the industry they may be having an interesting cash problem.
Publish date:

California's legal pot sellers have a problem: where to put the flood of greenbacks. 

"We can't legally take deposits because we are FDIC insured," explained Russell Colombo, CEO of California based community bank Bank of Marin (BMRC) - Get Report

Recreational cannabis sales kicked off in California on Jan. 1 of this year. At present, 10 states and Washington, D.C., have legalized the recreational use of marijuana. Cannabis remains illegal at the federal level, hence the inability of a bank such as Bank of Marin to accept deposits.  

When asked what cannabis sellers were doing with their cash, Colombo hinted probably stuffing it under a mattress. 

"It's a big problem -- they are hiding the cash in safes and it creates the potential for lots of crime," Colombo says. "There has to be consistency in the regulation."

For more insight into the cannabis industry, check out Real Money's 'WeedStreet' column.