• EconMan
    4.2k
    CBD is Getting Weird folks. Over a dozen banks dropped out in less than a month, including the three largest players.

    Here is the new requirements from the last "great bank" left playing. Brutal. :death:

    Required Documentation

    Merchant Application
    250k/month in documented volume
    Pricing of at least IC+ 200bp or tiered/flat equivalent
    Campaign Overview
    W-9
    SS-4 (EIN Paperwork)
    Articles of Incorporation/Organization
    Photo I.D. (for principals with 25% or greater ownership)
    Most recent Business/Personal Tax Return
    12 Months Most Recent Business/Personal Bank Statements
    3 Months Most Recent Processing Statements
    Voided Business Check and or Bank Letter for deposits (cannot be starter check needs to have legal name)
    Fully documented ownership - Operating Agreement (or any document showing ownership % such as K1 of Tax Return, Share Certificate, etc).
    Fulfillment Agreement
    THC Lab results (COA for each product sold)
    No products with a THC concentration greater than 0.3% by weight.
    No products with a CBD concentration greater than 70% by weight.
    Elevated Risk Addendum (attached)
    CBD Addendum (attached)
    List all products with CBD and THC concentrations for each product.
    5% ongoing reserve (attached)
    Merchants that sell Vape products will be subject to Mastercard Registration Fee ($1,000.00).


    Website Requirements
    THC Lab results to be displayed on each unique product page
    No disease claims on any marketing material
    We are screening websites and publicly available marketing material for any mention of diseases or disease conditions (for example, cancer, diabetes, Alzheimer’s, Crohn, Parkinson, Epilepsy, Fibromyalgia, Depression, Arthritis, inflammation, anxiety, etc.).
    No mention of prescription drugs on any marketing material
    We are screening websites and publicly available marketing material for any mention of prescription drugs (for example, Epidiolex, Prozac, Xanax, etc.)


    Prohibited
    Startup CBD Merchants
    Retail CBD Merchants
    Negative Option Billing (trial)
    Network Marketing CBD Merchants
    Merchants that are on MATCH
    Dry Herb and Wax Vaporizers
  • Mangu
    356
    Jeez....what’s the deal with these serious crackdowns? Do you think they’re just thinning out the herd? Or looking more like full outlaw?
  • EconMan
    4.2k


    My best suspicion is just good old fashion fear. Fear of what "might" happen. From over zealous government to idiot proprietors, Merchant Banks live in fear.

    Credit Card Processing is indistinguishable from "Money Laundering" and differences are only in perception.
  • EconMan
    4.2k
    This is fascinating and educational. I know we got some Washington folks here, I just forgot who?

    26 metric tons of THC were sold! :gasp:
    Washingtonians like their THC! :cool:

    After the Grand Opening: Assessing Cannabis Supply and Demand in Washington State
  • Pud
    235
    “Oh, can you tell that I hold almost all levels of American government in contempt? haha”

    Oh, I’m right there with you!... lol!
  • EconMan
    4.2k
    250 a QP. But only get to get it at most 3 times a year. So I like to stock up. Then it's the 320 an ounce bullshit when I run out.PelicanWarlord

    That's great prices. Jealous.

    This is good news.

    https://www.marijuanamoment.net/president-trump-reiterates-his-administration-will-let-states-legalize-marijuana/
  • EconMan
    4.2k


    Good friends and family. You need a brother? :joke:
    For a trim run, it would get my marginal costs down to nothing. To put it in context, I would pay around $700-800 for a "Royale with Cheese" and that would be "some buds" but still a LOT of shake and trim.

    Primo "buds" would be around $1000/qp. If I could get qp's at $200 my marginal oil costs would get down to about $10/ml. I'd be fat, dumb, and happy. :nerd:
  • EconMan
    4.2k
    Folks. It is getting crazy. If I was a conspiracy theorist, I would suspect CVS, Walgreens, Walmart, etc. have teamed up in collusion, trying to build an oligopoly in CBD

    Another good bank just dropped out of CBD. I literally possess no “good banks“ to put a CBD client into. Any bank I put them into, they’ll just get canceled after three or four months, so I’m dropping out of CBD until Congress or the courts does something. Too much risk.

    An interesting article on CBD and federalism.

    https://reason.com/2019/09/07/pointless-cbd-bans-are-spreading-like-well-cbd/
  • Dankpup
    111
    Weird the sport/ workout supplement industry doesn’t have the same problem. Almost all the ingredients in nutritional/pre workout supplements are manufactured in China, the level of cross contamination is nuts or intentional . I have followed the sport of MMA for years and when a fighter pops for a banned substance, sure enough they can produce their supplement and it has controlled substances in it. They will pull more off the shelf and have them tested to double check and yep. Ostarine is a common one.

    “According to USADA, ostarine, also known as MK-2866 and Enobosarm, is a "selective androgen receptor modulator (SARM) that is illegally sold worldwide as a performance-enhancing substance. Ostarine is not currently available as a prescription medication in any country, and its unauthorized use may carry serious side effects." It is commonly found in dietary supplements and unlisted in the ingredients, USADA said in a news release.”

    https://atozsportsnashville.com/ostarine-drug-taylor-lewan-suspended/

    Yet you can use purchase these products willynilly.
  • EconMan
    4.2k


    Interesting. Was unaware of this drug or its use in sports. Sort of like a steroid?
    Sounds like the politics of kraton ?

    CBD has got weird, in part because of our decentralized "federal" system, but also CBD merchants are a different class. My cannabis clients make ZERO medical claims. Most have a missionary zeal that causes them to make bad business decisions IMO.

    A typical first conversation between Me and small CBD vendor, now that I've become all cynical about it.

    • Vendor: As you know from our email conversation I like a lot of others got dropped by my bank and need to get it replaced asap or my business will be dead.
    • ME: Ok, no prob. I've been on your website and you make some pretty wild unsubstantiated medical claims. Those must be removed before an application is submitted.
    • Vendor: That's BS! I can send you articles proving it! My own grandmother had cancer and she took CBD and is now in remission.
    • ME: I'm so happy for you and your grandmother, but the banks and the FDA don't care about that. Any medical claims MUST have scientific (not merely journalistic) support. Do you have citations for the results of the Clinical Trials you ran.
    • Vendor: We didn't do any clinical trials. Everyone knows CBD is good for XYZ...
    • ME: The FDA doesn't know it and neither do the banks. They do know risk.
    • Vendor: I heard you guys were good, and got things done. You even have MJ clients.
    • ME: We are and we do, but you got to help yourself. If you insist on making medical claims, I can't help you. No one can. And if you meet someone who says they can, run. They are not being honest. No reputable merchant bank will give you an account if your business has a high likelihood of being successfully class-action sued and/or being regulated into destruction.
      GNC is also a client and the same rules apply to the supplements they sell. They got shut down hard for the same reason -- unsubstantiated medical claims -- which is how I met them. First thing we did was change their website and train their people. They are still processing and have a viable business. Right now you do not. Do you want one?
    • Vendor: This isn't right... not fair... this country is becoming a police state.... banks are evil.....
    • ME: Yeah, but do you want to have a viable ongoing CBD business within this unjust system or be a political radical? Think about it and if the former, call me and we will complete the application. Regardless best wishes.....

    Quite typical actually.
  • Dankpup
    111
    yes steroids or similar compounds, a lot of the time it will be Eastern block developed PEDs sometime popular enough to be illegal in the US and sometimes not. Sometimes it we be cattle steroids, so the excuse is “I had a steak in Mexico”.
  • Dankpup
    111
    Hope she wins big $$$.
  • EconMan
    4.2k


    Me too. I lived in TX for 20 years and it is a trip.


    Lots of folks have been talking about "egulation, lebling, ingredients, etc. I find perusing this site rather informative on the california system (my first hand knowledge is only of colorado). Sort of fun to load one up and start reading. :nerd:

    https://www.cdph.ca.gov/Programs/CEH/DFDCS/MCSB/Pages/PackagingandLabelingFAQs.aspx
  • EconMan
    4.2k
    Now this is worth reading! :gasp: :100:
    "The U.S. could become the missing link in North American legalization efforts, but that hasn't stopped marijuana companies from making major plays to position themselves for a future continental takeover."

    https://www.politico.com/story/2019/09/09/how-marijuana-is-poised-for-a-north-american-takeover-1427713
  • EconMan
    4.2k
    CBD is getting so stupid. Just spoke with a person this morning who had sent me their documentation last week. They were being charged 9.5% FIXED :scream: + $.55 per trans. :gasp: :gasp: :gasp:

    My HIGHEST rate porn client pays only 7%. Highest MJ client, only 2% above "Interchange". (depending on card mix, ~4% average). But this is not the astonishing thing. They were dropped by their bank even though they had "normal" chargeback rates? wtf?
    Their sin, they started growing. :roll:
  • Baron23
    9.7k
    Yeah, but it remains to be seen if it stays in there after reconciliation w Senate version and gets signed.
  • EconMan
    4.2k


    Agreed. I doubt it will, but it is a start. I expect to to either fail or be revised into non-existence but this is a historical moment.
  • JonnyFrontrow
    68
    The Democratic-controlled House of Representatives late Wednesday voted to pass a bill protecting banks that work with the marijuana industry, but some analysts are warning that the measure isn’t likely to become law in 2019 as it faces a tough road in the Republican-controlled Senate.

    The chances of enactment this year for the bill — known as the Secure And Fair Enforcement (SAFE) Banking Act — have risen to 1 in 3, up from 1 in 5, reckons Ian Katz, an analyst at Capital Alpha Partners. Those still aren’t great odds, however. “We remain skeptical for now,” Katz said in a note before the House vote, though he added that the chances could get better “if we see meaningful signals from the Senate in the next few weeks.”

    Full story here.
  • Baron23
    9.7k
    @EconMan

    Square welcomes pot businesses to its digital payments platform

    Square Inc. has become one of the first U.S. payments platforms doing business with CBD providers, just as the industry is booming.

    The company this week started allowing U.S. businesses to sell cannabidiol products on its platform while keeping track of payment and inventory management. CBD derived from hemp was legalized last year, while the intoxicating THC compound remains illegal at the federal level.

    “We saw this as an opportunity to make our tools available to sellers” in the industry, Square said in a statement.

    The move comes as more U.S. states legalize marijuana, unleashing a surge in demand. The legal marijuana market, estimated at US$13.8 billion globally last year, is expected to increase at 24 percent annually by 2025, according to Grand View Research.

    Payment is also getting easier. Last month, the U.S. House advanced a bill designed to let banks do business with cannabis companies in states that permit marijuana sales, a step that some supporters see as helping to pave the way to nationwide legalization.

    Shares of Square climbed 3.7 percent as of 2:41 p.m. in New York, extending their gains for the year to 11 percent.
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