DENVER—The Federal Reserve’s crackdown on financial services businesses that support the cannabis industry continues, this time taking away the ability of CS Compliance Systems, developers of CannaScore, to accept credit card payments, the Denver Business Journal reported.
The company serves the marijuana industry, and when the Federal reserve learned that, it made its move.
The decision by the Fed represents another bump in the road for those that provide financial services to the marijuana industry—which has a difficult time in finding FIs to provide services to them due to the fact that marijuana, on federal level, is illegal. As a result, pot businesses have had to rely on cash, placing not only the businesses in danger from criminals but also the communities in which they are located.
The Denver Business Journal stated that CannaScore said it's appealing the revocation of its credit card processing privileges.
"CS Compliance Systems is a software development company. We provide our systems to companies doing business in the cannabis sector, but that is no different than a power company, furniture company, or telephone company, selling products and services within this sector," said Thomas Smith, managing partner, in a statement.
Because it lacks the ability to use credit card services, the company said it's now giving away its product.
The company added that the government has already legally recognized its product, when the U.S. Patent and Trademark Office issued CannaScore a trademark, which it said the government wouldn't issue if the company was violating any federal laws, such as the Controlled Substances Act, the Business Journal Reported.