Element FCU 'apparent' winner for West Virginia pot banking services

Register now

Element Federal Credit Union, a $35 million-asset institution based in Charleston, W.Va., this week was named the “apparent winning vendor” in its bid to serve the state’s medical cannabis banking program.

Earlier this year the credit union was one of just five entities to respond to a request for proposal from lawmakers after the state’s contracted banking vendor refused to provide services to the program due to conflicts with federal law. With West Virginia voters having already approved a medical marijuana program, the next step was for the state to accept bids for licenses from cannabis-related businesses such as growers or dispensaries, and when patients apply for a medical cannabis card – and an entity needs to be able to accept the application fees.

West Virginia’s State Treasurer’s Office noted in a press release that Element is the “apparent” winner because per the notice terms of the RFP, the other companies that applied to serve the medical cannabis banking program have until noon Eastern Time on Sept. 3 to file a written protest.

As such, officials with Element FCU had to decline comment Wednesday as the credit union is in a blackout period.

John Perdue, West Virginia’s treasurer, said his office and Element FCU already have commenced negotiations to finalize issuance of the purchase order. Until the purchase order is issued, no other information will be released and the blackout period will remain in place, Perdue said. Once all issues have been resolved, the state will reveal the long-term goals and interim procedures for medical cannabis banking – a move that could come as early as next week.

“My staff has worked tirelessly to make this program viable,” said Perdue. “I look forward to awarding this contract and moving forward with a banking process. My main priority is to help people in our state who want this medical option for either themselves or a family member.”

West Virginia’s medical cannabis program was supposed to go live July 1, but has been delayed by the need to amend state law.

Earlier this summer, Element FCU said in addition to supplying financial services to the state for licensing fees, the credit union would consider its options for cannabis-related businesses and ancillary businesses if banking services are needed.

According to the Financial Crimes Enforcement Network, as of March 31, 2019, some 633 FIs were actively banking marijuana-related businesses in the U.S.: 493 banks and 140 credit unions.

For reprint and licensing requests for this article, click here.
Marijuana banking Marijuana industry Growth strategies FinCEN West Virginia
MORE FROM AMERICAN BANKER