Less than a month after MOCA Modern Cannabis was fleeced for $200,000, the Logan Square-based boutique dispensary with designs on River North Expansion hired former Chicago Police Department Superintendent Garry McCarthy as a security consultant.
Private security for cannabis companies is a logical growth opportunity for qualified individuals and organizations, considering $40 million in cash was collected by a finite number of Illinois businesses in January 2020. Denver-based dispensaries, which due to federal banking laws are also largely-based businesses, get broken into approximately 100 per year.
Chicago-based Green Thumb Industries, which operates multiple Rise-branded dispensaries throughout the state, tapped former Illinois State Police Director Terry Hillard as a security consultant. To date, more than 18 former Illinois cops are now getting paid by entrepreneurs scaling cannabis-based business operations.
The January 6 overnight MOCA break-in apparently was an inside job, involving a secure vault, a safe and a blowtorch.
While archaic federal banking laws provide business opportunities for the McCarthy’s of the world – along with lower profile security gigs that pay up to $98,000 per year – requiring small and publicly-traded cannabis companies to continue to transact primarily in cash doesn’t seem like a long-term, scalable solution for one of the state’s fastest growing industries.
Having a lot of guns and money around the store may also be a buzz-kill for many consumers already upset about flower shortages.
While efforts to mitigate risk for Illinois banks wanting to serve local businesses that violate federal law may help at the edges, security problems resulting from too much cash on premises will continue to arise. Just want until people line up to freely light up in New York City (see above).
Businesses owners in an industry that legally operates in 40 states should be able to open up bank accounts. This won’t happen without a green light from Washington D.C., which all of a sudden has some extra legislative capacity.
There are electoral incentives for candidates and incumbents (including the occupant of the White House) to remove cannabis from Schedule 1 of the Controlled Substances Act, which would effectively protect banks from transacting with cannabis companies.
How many more six-figure break-ins will pioneers in this industry have to endure until the rules are inevitably changed?