As Marijuana Sales Grow, Start-Ups Step In for Wary Banks [DealBook]
Here in Colorado, a major problem for legal marijuana dispensaries is how to get all their cash from the register to some place safe, like, say, a bank. Most banks are regulated by the federal government and since marijuana is still classified as a Schedule I drug, most banks aren't interested in taking the money from the sale of pot. There are a few credit unions that will let the businesses open accounts, but for the most part, it's a real problem. There are a few people trying to crack this nut and, wouldn't you know it, one of them used to be a bank examiner for the Office of the Comptroller of the Currency.
When Lamine Zarrad was not at his job as a federal banking regulator in recent months, he was spending a lot of time at Denver’s marijuana dispensaries.
As a federal employee, he could not partake of the pot.
He was there, instead, to pitch the shops on a start-up he has been working on in his free time and is making official this week after quitting his job as a bank examiner at the Office of the Comptroller of the Currency, a division of the Treasury Department.
Mr. Zarrad’s start-up, Tokken (pronounced token), is one of several recently created companies looking to solve one of the most vexing problems facing marijuana businesses in Colorado and several other states: the endless flow of dirty, dangerous, hard-to-track cash.
This is all too amazing. Not only did the author write "partake of the pot" Zarrad's business name is devilishly clever. But Tokken has to actually do something useful, right? Right.
Mr. Zarrad’s start-up, Tokken, is younger than the others, but he is aiming to offer something new — an electronic payment system that will not rely on the credit card companies or debit networks. Somewhat like PayPal or Venmo, Tokken will use the electronic money transfer system in the United States known as the Automated Clearinghouse, or ACH, to move money from the bank account of a dispensary customer to Tokken’s bank account. Tokken will then keep subaccounts for each dispensary — making it unnecessary for the banks to deal directly with dispensaries.
Zarrad says that the biggest problem banks have with these businesses is when they fail to "[track] the transactions carefully." Tokken's payment system will run on a blockchain, making the transactions "irrevocable" and both the dispensaries and the banks will have "a reliable and complete record of all Tokken transactions, including the specifics of each transaction." This is so crazy it just might work! Or not! Either way, it's very interesting and the kind of thing that your CPA pot practice should be a part of. Or a job opportunity at least.
H&R Block to Trump: We want to simplify taxes, too [CNBC]
Last August, when raging blabbermouth Donald Trump's new reality show was in its early episodes, he announced that his tax policy was to "Put H&R Block out of business." Now it's February and H&R Block seems to have gotten around to responding when its CEO Bill Cobb was on CNBC yesterday:
"There are ways to simplify the tax code. For example, there are five definitions of a child. Some of this is silly," Cobb told "Squawk Box" on CNBC. "[But] I think it's silly to talk about just ripping up a 74,000-page [code]. It's too complex today to go to zero [pages]."
He's right, this — the complexity of the tax code, Congress, Republican presidential candidates, America — is all pretty silly. H&R Block, however, benefits immensely from the silliness and to conserve it probably wouldn't bother them too much.
Accountant needed for maritime adventure show [Accountancy Age]
Here's a job description you don't read every day:
Windfall films are on the hunt for a practitioner who wants to explore their sense of adventure, as the company looks to re-enact a famous 18th Century voyage across the Pacific Ocean.
The company is looking for an accountant who will be responsible for the ships finances, otherwise known as a ‘purser'.
If selected, the lucky accountant will set sail in a historically accurate replica boat this summer, but will have to survive on basic rations and endure extremely tough weather.
The accountant will be one of ten members aboard the ship, including one fully qualified yacht master, a doctor and a botanist.
As well as brilliant finance skills, the accountant will need to use their ingenuity and teamwork skills if they are to successfully battle the elements and complete several historical challenges that will be presented to them throughout the voyage.
Not mentioned: the real possibility of DEATH. But otherwise it could be fun.
Previously on Going Concern…
I wondered aloud if an accountant would ever fall for a phony IRS call. And someone in Open Items wants to know the deal with EY's financial services tax group in New York.
In other news: