In “Are Banks Prepared for Legal Marijuana?” (Thomson Reuters, 27 Aug. 2019), Gabe Hidalgo, managing director in K2 Intelligence’s Regulatory Compliance practice, discusses the steps banks should be taking to prepare their internal controls and processes for marijuana-related businesses (MRBs). According to Gabe, banks should be preparing for legalization now by conducting a complete risk assessment to determine how they plan to serve cannabis customers, as well as performing a gap analysis to find out where they lie now in terms of staffing and resources, and what they need to do to get ready.

The article highlights some questions banks should be asking, which include:

  • What markets does the bank want to serve, and what products and services do they want to offer? 
  • Can the bank’s compliance team handle a heavier workload?
  • Should some functions—e.g., customer on-boarding, compliance monitoring—be outsourced? How will training be handled?
  • Do the bank’s due diligence protocols need to be updated?
  • How will the bank manage client relations and oversight?

Read the full article in Thomson Reuters