It's not breaking news that cannabis businesses and the banking industry have a contentious and ugly relationship fueled by paranoia and fear. The vast majority of US banks will neither make loans to, nor open and maintain accounts for, cannabis businesses. Therefore, these businesses are shut out of access to credit and capital, and usually have to operate as a cash only enterprise. This brings inherent headaches and risks, and makes them a prime target for robberies.
Oregon's US Congressman Earl Blumenauer has led the charge for banking reform for years, but the Republican-controlled House and Senate have blocked bills to address the issue, even those with bipartisan support. But as Forbes reports, a Florida branch of (candidate for worst bank ever) Wells Fargo upped the ante in what is believed to be a first-ever move by a bank: shutting down the account of a political candidate solely because the campaign has received donations from the cannabis industry.
Candidate Nikki Fried is a Democrat running for Florida Commissioner of Agriculture and Consumer Services. Before she began her campaign, Fried worked as a lobbyist for medical cannabis. (Keep your jokes about her last name to yourself.) In a video that announced her campaign, Fried said, "In 100 days we need to elect a Commissioner of Agriculture and Consumer Services that will fight for the rights of medical marijuana patients, protect our coastline. and support our farmers." The office for which she is running has minimal oversight of the medical cannabis industry.
Per Forbes, a July 11 email from Wells Fargo to Fried's campaign compliance officer reads:
"As part of the onboarding of the client it was uncovered some information regarding the customers [sic] political platform and that they are advocating for expanding patient access to medical marijuana. Per our escalation path we need to confirm the following:Not growers, processors, or dispensaries, not anyone handling, growing or selling cannabis—lobbyists for the medical cannabis industry. Mind you, Florida already has a medical cannabis program, albeit a restrictive and limited one that's being enacted at a sloth's pace. But when the campaign informed Wells Fargo that yes, they were receiving money from the industry and had no plans to stop doing so, Wells Fargo shut down the account.
Can you confirm the types of transactions expected for this customer & if any of the transactions will include funds received from lobbyists from the medical marijuana industry in any capacity?"
In a letter dated August 3, Wells Fargo wrote,
"Periodically, we review our account relationships as part of our responsibility to oversee and manage banking risks. As a result of a recent review of your account relationship, we determined that we need to discontinue our business relationship and close the account above within 30 days from the date of this letter."On Monday, Fried held a press conference to address the closure, describing the bank's decision as an "arbitrary, unprecedented action against the fundamental rights to speech of a candidate for public office."
One might argue that Wells Fargo has the moral high ground—except they really don't. Since 2000, Wells Fargo has been fined more than 12 bllion dollars ($12,585,199,147 to be exact) for nearly 90 offenses of mortgage abuses, consumer protection violations, price fixing, and investor violations.