An Oklahoma businessman’s guilty plea in federal court to opening a bank account by misrepresenting his cannabis company in order to launder its proceeds illustrates the ongoing, even dangerous enterprise of banking cannabis revenues, says the CEO of a financial services platform.
On August 17, Victor Ngo pleaded guilty in U.S. District Court to telling the bank involved that his company, Friendly Management Group, was a wellness and fitness company instead of the cannabis sales operation it really was. FMG had been charged with one count of money laundering.
It’s cases like these – and Ngo’s is not the first – that tend to set off cannabis entrepreneurs like Mark Lozzi. “This is an industry where examples are looked to be made,” Lozzi, CEO of the Irvine, California, financial services platform Confia, said in an interview. “This is a perfect case of someone looking to be made an example of.”
His reference was to how banks typically won’t deal with cannabis companies because of fragmented state laws and because the drug remains on the federal Schedule I list of dangerous narcotics. In addition, while Oklahoma is legal for medical cannabis, recreational use remains illegal in that state.
Read more at forbes.com