Independent Banker - July 2023 - 31

in compliance software specifically
designed for the cannabis industry. "
Green Check Verified in Bonita
Springs, Fla., offers a platform that
enables banks to develop tailored
programs that cater to the needs
of each cannabis-related business
they serve, " ensuring transparency,
efficiency and scalability across the
board, " says Kevin Hart, CEO.
" Take our recent partnership with
Avidia Bank, a community bank
in Massachusetts, " Hart says. " By
partnering together, we were able
to create a customized program that
helps Avidia ensure compliance with
state and federal laws and regulations,
so they could focus on fostering
relationships and serving cannabis
business across the Boston suburbs. "
Green Check Verified's platform
automates the most " time-consuming
and error-prone " aspects of banking
cannabis, and the company's advisory
services range from customer
acquisition to board reporting and
audit and exam preparation.
Earlier this year, the company also
debuted Green Check Connect, a
centralized marketplace of " reliable,
trustworthy and cost-effective service
providers " for cannabis-related
businesses, Hart says.
" It's the first platform specifically
dedicated toward helping CRBs
succeed-all in one forum, " he
says. " The new marketplace also
safeguards cannabis businesses from
exploitative pricing models prevalent
elsewhere and begins to tackle the
pervasive, industry-wide challenge
of inaccessibility to reliable financial
services in the cannabis industry. "
Acquiring the right tools
What does it take for a community
bank to service the cannabis industry
in terms of compliance? " Firstly,
having strong board support and
senior management commitment is
A brief list of cannabis
banking requirements
Deciding to enter the cannabis
banking space is not as easy as
hiring an additional person to
oversee the new clients, says
Laura Benson, vice president,
BSA officer - cannabis at CFG
Bank in Baltimore. You must
consider the need to:
 Ensure you hire staff who
are not offended by or
unsupportive of banking
cannabis businesses
 Verify business licensing
with appropriate state
authorities
 Review the state licenses
needed to operate a
cannabis-related business
 Monitor licenses for no
violations of individual state
regulations
 Develop an understanding
of " normal and expected
activity " for the business
and the types of customers
it serves from a sales
perspective
 Constantly evaluate your
policies and procedures
Financial Crimes Enforcement
Network's 2014 guidance. " A team has
been developed from the beginning
to lead the way and to focus on
the industry-specific nuances for
continued compliance, " Peters says.
All incoming and outgoing dollars
are tracked for legitimacy and
compliance with state regulations
and the FinCEN guidance. " Changes
to ownership, along with mergers
and acquisitions happening with
great frequency in the market, lead to
complex relationships, " Peters says.
" Understanding the documentation
while maintaining [Customer
Identification Program] and beneficial
ownership for BSA is key. Knowing
your customer and your customer's
customer are also important while
monitoring the relationships to
legitimize transactions. "
SARs are a must
Marijuana suspicious activity reports
(SAR) are required even if the
business is acting legitimately, Peters
says. BSA high-risk monitoring,
including enhanced due diligence, is
" paramount, " as is monitoring negative
news information. Keeping up to date
with state changes while monitoring
the federal legislation is also important
while building a program.
vital to entering this line of business, "
says Troy A. Peters, president and
CEO of Jonestown Bank & Trust Co. in
Jonestown, Pa. " Strong BSA programs,
discipline and a strong staff is vital. "
The $903 million-asset community
bank has instituted a risk-based
approach with the concentration
limits to comply with the Bank
Secrecy Act (BSA) expectations
outlined within the U.S. Treasury
" Cash handling is also a factor while
servicing this industry-working with
vendors that may deliver and process
cash on your behalf and figuring out
how to get the cash to your servicing
location, " Peters says.
Overall, examiners want to see
programs that consider each piece
of the FinCEN guidance and the
rescinded Cole Memo, he adds. " Since
the beginning of this endeavor, we
have been in communication with
our examiners, and we have a good
relationship with them. "
Seattle-based Shield Compliance
LLC offers a BSA/AML technology
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