October 8, 2019
COB professor to kick off cannabis summit
An East Carolina University College of Business professor will kick off the 2019 Insuring Cannabis Summit on Oct. 17 with an opening address discussing the history of cannabis legalization, insurance and how the pair coexists in the business world.
Brenda Powell Wells, Robert F. Bird Distinguished Professor of Risk Management and Insurance and director of the COB’s Risk Management and Insurance Program, will giving the virtual summit’s opening address.
The Insuring Cannabis Summit brings together cannabis growers, suppliers, distributers and insurers from across the country to examine the challenges and risks facing marijuana-related businesses (MRBs).
Despite a growing number of states decriminalizing marijuana for recreational and medical use – 33 states in total as of September 2019 – questions remain around the legality of businesses that interact with MRBs, including insurance companies.
“The biggest challenge right now is that cannabis is still a Schedule I controlled substance under federal law,” Wells said. “Basically, in all 50 states, it is illegal at a federal level to possess cannabis or use it in any form, despite what state law allows. This is the insurance industry’s biggest concern.”
“When a business accepts money from an MRB, it runs the risk of being found in violation of the RICO (Racketeer Influenced and Corrupt Organizations) ACT for laundering money. That causes a lot of uncertainty for insurers because you never know if there will be a change in how federal laws are enforced and how that could affect your business.”
Twelve states have fully legalized marijuana for recreational use, but Wells said business owners must be careful not to run afoul of state law.
“The odds of the federal government going after you are slim in states that have decriminalized marijuana, but MRB owners risk their personal freedom every single day that they’re in business,” Wells said. “If you’re an MRB you have got to follow your state laws to the letter, even when nobody is looking.”
Wells said that that insurance industry is closely watching the progress of the 2019 SAFE Banking Act. The bill, which was passed on Sept. 25 by the U.S. House of Representatives, provides protections for banks and insurance officers who do business with MRBs in states which have legalized marijuana activity. The bill must be passed by the senate and signed by the president before it becomes law.
While the country awaits the final outcome of the SAFE Banking Act, Wells said she hopes those attending the conference gain a better understanding of the country’s marijuana industry.
“It’s a hot topic right now because of the conflict between federal and state law,” Wells said. “But, people have been growing this plant for thousands of year. What I hope people get out of this summit is that marijuana is not some alien plant. A lot of people in the business do not even use marijuana. People need to be educated about it, especially those in the insurance industry because these businesses need our insurance and support.”
Free tickets are available online for the 2019 Insuring Cannabis Summit. The summit will be recorded for later viewing for those that registered for a ticket if they cannot watch the event live.
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