This commentary was written by Mr. Jerome Diamond, three-term Vermont Attorney General and member of the VSECU Board of Directors from 1997 to 2015, Chairman of the Board of Directors from 2008 to 2015. Diamond currently lives in Lebanon, in New Hampshire.
Last week, the CEO of the Vermont State Employees Credit Union announced that the credit union was suspending the taking of new accounts related to the cannabis industry, saying VSECU did not have enough staff to properly service new growers. , manufacturers and retailers that were about to be licensed in Vermont. It was a shocking statement.
Years ago, when I was chairman of the board, when medical marijuana had just been legalized in Vermont (although still illegal by federal law), the board decided that VSECU would provide services to new dispensaries in hopes that one day Vermont would legalize the use and retail sale of cannabis and the business would grow for VSECU.
Over the years, VSECU has grown this business and had 80 companies it served at the time of the suspension.
For the past three years, everyone knew that by October 2022, regulated retail would begin in Vermont. And the Vermont Cannabis Control Board has estimated that it will, over time, issue 100 to 300 licenses to growers, manufacturers and retailers, all of whom need a financial institution to do business. With VSECU already firmly established as the medical marijuana industry’s preferred financial institution, it was only fitting that when regulated retail began in October 2022, VSECU would be ready to serve the lion’s share of new licensees. Licence. Instead, the CEO has suspended new account service, claiming a lack of staff to properly handle potential new members!
If that’s true, there’s no excuse for it. VSECU has had years to prepare for this. If they hadn’t budgeted money to increase staff, they would have had to take it from the million dollars they spent on flyers and digital advertising to promote their proposed merger with the New England Federal. CreditUnion. And if lack of staff is the real cause, then it is a case of incompetence on the part of VSECU management. But is this the real reason? Or does it have to do with the proposed merger itself?
VSECU is waiving its state charter to merge with NEFCU and will be governed by a federal charter if the proposed merger goes through. Given that growing, manufacturing, and selling marijuana is still illegal under federal law, it’s no wonder that so few federal credit unions are willing to risk the wrath of federal regulators on this issue and therefore to take as members few businesses related to marijuana. Could it be that the National Administration of Credit Unions, which is reviewing the proposed merger with NEFCU, has put a stop to VSECU to develop this business if it wants the merger with NEFCU to be approved? If so, this is the first of many nasty surprises VSECU members are likely to experience with this merger.
All the more reason to vote NO to the merger project!