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Reducing Risk & Identifying Opportunities

Like alcohol in the days of prohibition, cannabis today is regulated under a complex mix of legal statuses, depending on location and jurisdiction, and is currently undergoing rapid shifts in public opinion. Though cannabis / marijuana is increasingly legal or decriminalized in more and more places, large hurdles still stand before all Americans will have access to the plant for both medicinal and recreational use. Canada recently become the largest country to ever federally legalize cannabis through the passing of legislation, in fact only the second country ever to do so, following Uruguay.

United States prohibition-era alcohol was sold in speakeasy black markets—and somewhat similarly, the owners of even many legitimate U.S. cannabis-related businesses today still often have to deal in cash-only transactions. This is because despite the increasing cannabis legalization at the statewide and local levels, there is still a lower overall willingness among financial institutions to provide their full suite of banking services for dispensaries and other cannabis-related businesses.

Steven Kemmerling is the Founder & CEO of CRB Monitor, a Chicago Founder Institute portfolio company leveraging big data for cannabis corporate intelligence, reducing risk and identifying opportunities across comprehensive cannabis markets.

According to the Arcview Group, legal cannabis sales in the United States will reach $21 billion by 2021, up from just under $9 billion in 2017.

As you might think, financial institutions want to get in on the action of this newly blossoming market opportunity. The problem for the banks though is that the U.S. federal government also exercises oversights on cannabis via the Drug Enforcement Agency, which still recognizes the plant as a Schedule 1 drug. So in this new ‘green’ gold-rush of cannabis-related ventures rapidly laying roots in an already-blooming market, understanding the most up-to-date information is truly critical for safely and effectively navigating the legal and operational boundaries within cannabis law and business. 

A 2019 New York Times report (*paywall) lays out very plainly the reasoning for why a bank may have some legal concerns, 

Not only does selling marijuana violate federal law; handling the proceeds of any marijuana transaction is considered to be money laundering. Very few banks are willing to bear that risk.

Mix one solopreneur and thought leader with a boatload of top industry data, and you have CRB Monitor’s cannabis-related corporate intelligence solution. The CRB Monitor platform offers comprehensive and detailed analyses covering all cannabis industry participants. The growing database compiles existing and known businesses associated with cannabis, and parses the most up-to-date data to provide customized insights.

CRB Monitor’s customers need the solution. Cannabis-related businesses are growing fast, and they need to stay safe and reduce their risks—for the entrepreneurs, investors, as well as other partners and stakeholders, including financial services providers. According to the company, 

MRB Monitor [now CRB] develops data and business intelligence solutions that help financial institutions more effectively identify and manage high-risk customers, accounts and loans. Our inaugural product was specifically designed to help financial institutions identify potential fraud and money laundering relating to the emerging legalized marijuana industry. We aggregate publicly available, but unstructured and hard-to-find, data from hundreds of disparate government/agency sources and organize it neatly into one standardized database.

CRB Monitor has the banks and the cannabis industry pros covered. Understanding compliance is crucial for the industry to move forward, CRB Monitor lets cannabis product supply chain and outside financial service providers understand their customers more confidently, while following all jurisdiction rules to a T. 

A Founder Forged Deep ‘in the Weeds’

As one can imagine, CRB Monitor's wealth of data and industry knowledge represents a relatively complex niche—but Founder & CEO Steven Kemmerling is a longtime industry insider, and a cannabis regulatory go-to source.

He recently spoke at the ACAMS’s 25th Annual International AML & Financial Crime Conference, as well as a backlog of other conferences over the past few years. Kemmerling is known for discussing recent changes in state-level laws, shifts in federal policy enforcement, as well as of course how banks and financial institutions are handling each change in turn. 

It should come as no surprise then that Kemmerling’s own background includes a great deal of advising to banks, working on mergers and acquisitions, capital raising, and corporate development. Of note, the Founder has worked on approximately $1.75 billion in closed transactions, an enormous display of experience in handling of compliance and risk analysis. Kemmerling notes,

My prior entrepreneurial experience includes helping to launch and grow a boutique securities litigation and anti-money laundering consulting firm, serving some of the nation's largest financial institutions.

Financial institutions and cannabis-related industry insiders alike know they can trust CRB Monitor to be confident in their development roadmaps, fully accounting for all the risks so they can focus on the big opportunities ahead. The company recently closed a $1.5m seed round, showing investor confidence in the regularorty tech platform's demonstrated industry thoroghness and early performance.


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