Pub. 13 2018-2019 Issue 5

WWW.NEBANKERS.ORG 10 COUNSELOR’S CORNER Bryan Handlos and David Bracht, Kutak Rock LLP 411 on 420 for Nebraska Bankers 4 11: A REFERENCE TO “INFORMATION” WITH ITS ORIGINS IN directory assistance, an information retrieval system popular in prehistoric communication systems. —See https://en.wikipedia.org/wiki/4-1-1 420: a reference to cannabis that reportedly originated in California in 1971 and is also associated with April 20, which has become an international counterculture holiday, when people gather to celebrate and consume cannabis. —See https://en.wikipedia.org/wiki/420_ (cannabis_culture) Cannabis is illegal. Money laundering is illegal. Those two facts are all the information many bankers believe they need to know about cannabis. Is there more to know? Nebraska is obviously not California or Colorado, it does not have a booming cannabis related business environment, and remains one of the most cautious states in the country when it comes to the legal environment for cannabis. 1 Is there really a reason to understand cannabis banking issues in Nebraska? This article suggests a number of reasons why Nebraska bankers should consider stay- ing on top of cannabis banking issues. Trends More than thirty states have now legalizedmedicalmarijuana, which is tenmore states than had done so in 2016. Ten states have legalized adult-use recreational marijuana. In 2016 only four states had done so. Estimates are that approximately $10 billion of legal marijuana and marijuana-infused products were sold in 2018, a substantial increase from 2016’s total of approximately $7 billion. At least one projection suggests that total sales may exceed $14 billion in 2020 and $20 billion in 2025. According to FinCEN, the number of depository institutions 2 providing bank- ing services tomarijuana related business continues to climb and may soon reach or exceed 500 institutions. These broad trends are of course no guarantee of what will happen in Nebraska. 3 Although predicting the future is perilous, many knowledgeable experts would say that further legalization is coming. Eventually, even Nebraska may come to see changes. 4