PEP Episode 012 — Unraveling Cannabis Payment Processing Challenges with Ian Rassman

Podcast Description:

In the studio today we have James Huber, Partner of Global Legal Law Firm joined with guest star, Ian Rassman, cannabis advocate, and specialist on payments and banking. Today we focus more on Rassman’s specialty, the cannabis space.  How it coincides with the payments industry, why MasterCard or Visa don’t want to participate in the cannabis industry, and what cannabis could hold for the future.


Jeremy Stock (00:00):

Welcome to the Payments Experts Podcast, a podcast of global legal law firm ISOs, FinTech, pay fax agents, merchants, processors, acquiring banks and card brands. If these terms mean something to you, this podcast is for you. If these terms aren’t so familiar, this podcast is even more for you. We hope you enjoy this episode of PEP, the Payments Experts podcast. Welcome to the Payments Experts Podcast, a podcast of global legal law firm. Today in studio with us is managing partner James Huber, as well as special guest Ian Rassman. Ian is an industry leading payment specialist with over 12 years of experience in the payments industry, especially in the cannabis space. Ian, we’re really excited to have you with us.

Ian Rassman (00:58):

Well, hey, thanks so much for having me here today. I’m really thrilled to be here with you guys. You guys are really the industry leading professionals in what you do, and I’m thrilled to be here. How did I get started in payments? I had a software patent 15 years ago that led me into the transportation industry, and while I was in the transportation industry, I met credit card processor and we started working together and I really got into the payments industry and that was about 12 plus years ago, got myself into payments and then about seven years ago I started focusing on the cannabis industry because for about the last 35 almost years, cannabis has kind of been around me. And so now I’m able to bring all these worlds together here and do cannabis payments.

James Huber (01:51):

Yeah, that’s great. I mean, seven years ago was, I mean, is that when Oregon and everybody started legalizing,

Ian Rassman (01:58):

It was really right after California went recreational. As right as California was starting to go recreational, I sensed the wave of it all and I just jumped in a hundred percent.

James Huber (02:10):

Yeah, I mean, that’s good instincts. We had a bunch of clients that were ISOs, large ISOs, and as soon as Weeded started going recreational, they all said, I’m going to go be a weeded farmer. We’re printing gold. And everybody you talk to, even in the VC area, they’re going, anybody’s talking about grad school is the new green rush and you’re growing gold out there. And 100% of my clients that got into the marijuana farming whatever, all failed. I think some of them are still going, but it was, they’re writing a lot of checks and the green rush kind of never came right? Or did it? Did I miss it?

Ian Rassman (03:04):

I don’t know that the bulk of the industry saw a green rush. I think select players did, but I think in general, people ask me all the time, Hey, should I get into the cannabis industry? And my general answer is no, don’t get into the cannabis industry unless you really have a passion for it. If you think you’re getting in because you’re going to be printing money, you can forget about that. If you get into the cannabis industry, you’ll be lucky to make a living out of it and scratch out and meager existence. So the passion for the plant has to be there. You have to enjoy what you’re doing because I think if you only enjoy the money, you may not find the satisfaction you’re looking for in the cannabis industry.

James Huber (03:46):

Yeah, I mean, I think that goes with everything across the board. I remember going out to one of these locations that they’re growing marijuana and they wanted to build a farm, and I’m out there in my suit, I’m the lawyer because I’m going to be the one filling out all the applications and all of this. And this really nice woman took me over to her pig farms and said to me, point blank, if this goes wrong, I’m going to feed you to the pigs because they eat everything but your fingernails. There’s be no, I’m like, whoa. I realized, I was like, oh my gosh. Well, these are drug dealers until they’re not. I’m going to try and make them legit. I saw that over and over. I was like, you’re dealing with people that were drug dealers. Fine. They’re just selling weeded. I mean, I sold weeded in college too, but these were doing it on a large scale and now they’re like, ah, I’m going to go legit. And I saw that they couldn’t make the transition, and I think most of ’em actually made more money, even the legal operations selling their weeded out the back door

Ian Rassman (04:55):

A hundred percent.

James Huber (04:59):

When it first started, it was all cash or Bitcoin. I had a guy who, he was in that Silk Road thing, and I think he had 680 Bitcoins. He didn’t hold onto ’em, unfortunately. So I mean, how did payments make its way into the marijuana business?

Ian Rassman (05:30):

It was all cash in the beginning, and an all cash industry is really not ideal for anybody. What’s the best way to make sure that any system goes corrupt? Well, just two a hundred percent cash and then nobody knows what’s going on. I think as the industry started progressing and the states started licensing cannabis businesses, they started to realize the tax revenue that can come from it. And today, there are several states where the tax revenue from cannabis exceeds the tax revenue from alcohol. So the states are into this, right? They’re not going to give up this revenue, and eventually the federal government’s going to come along and want their part of it too. And as this momentum has picked up, there have been many state level banks and credit unions that have stepped up to fill the need. People are looking for banking, and so people and companies have stepped up, financial institutions have stepped up to do this and provide this service.

Ian Rassman (06:43):

But as you know, there’s a little bit more reporting K Y C A M L, all surrounding cannabis businesses to make sure that they’re as compliant as can be within the laws that we have today. So more and more financial institutions have stepped up to fill this need and more are stepping up on a regular basis. I think the last estimates that I heard theres’s approximately 15,000 financial institutions in the United States between banks and credit unions, and somewhere around the seven 800 or so, mark is what we think is the number of financial institutions that are already willing and able to serve cannabis businesses. As you know, there’s more effort for them in that K Y C A M L, so they have a higher overhead to manage those CRBs when they bring them on, and a lot more reporting to do to demonstrate that they know where the funds are coming from. So payments and banking have been making their way steadily into the cannabis industry, and we see those numbers of financial institutions steadily increasing, and we’re hoping for a big federal change. And then I think that could be the watershed moment that normalizes banking and payments in the industry.

James Huber (08:10):

Yeah, I mean, you’re really involved with LA Normal, which is probably one of the bigger normal organizations. For those people that don’t know what is normal.

Ian Rassman (08:20):

Normal is the National Organization for the Reform of Marijuana Laws founded in August of 1970, so just turned 53 years old. The whole organization normal. My group, Los Angeles Normal was founded in 1973, so we just hit our 50 year anniversary this year, and normal is the oldest organization in existence today that’s been dedicated to consumer rights. This is way before any industry. This was about consumers, people not getting arrested and having the freedom. Really this is a freedom issue, having the freedom to choose. So normal’s been at the forefront of that for 53 years, and I am super honored and proud to be able to take up the mantle and stand upon some of the shoulders of the giants that have come before me.

James Huber (09:16):

Yeah, it’s a great organization. I remember when I was in college getting a little involved with it because I mean, one of the biggest problems is the overcrowding in jails and it’s people getting arrested for having a little bit of weeded on them, and they’re all minorities, so it does great work. How much advocacy, campaigning do you guys do up on the hill and how receptive is it? Because I want to lead into that of the banks need to have some aspect, some play in this, even if we go full peer to peer, we’re not getting rid of banks. We all like to think that we are, but we’re not going to, and most banks have at least some level of federal oversight, if not quite a bit. So what I’m leading into of how normal is addressing that, what kind of feedback they’re getting, I mean, my understanding is nobody’s going to touch this thing for a while. If we’d put Bernie up there, I think he’s said outright, he’s going to do it, but I don’t think anyone else is going to touch it. So what are you guys hearing?

Ian Rassman (10:26):

So the way that normal works is sort of at the local, the state, and the federal level. This is how the organization is divided up. So Los Angeles normal, we’re traditionally focused on Los Angeles area politics and whatnot, and California normal supports our statewide effort on cannabis reform. And then we all feed up to the larger national organization where we all contribute time, money, and resources to pushing forward on our federal agendas. So normal has been supporting and behind many of the initiatives that we’re all familiar with, the More Act, the Safe Banking Act, which you just mentioned, and I know that we’re all putting a lot of stock in what Safe Banking could do and most likely would do, but this has been in front of the House and the Senate some seven or eight times. I mean, it just keeps going to them and they keep not moving it forward. So I don’t know that I’m personally very hopeful that that’s going to see any significant change anytime soon. But now, we all saw the news coming out yesterday about how the, sorry, just trying to silence my phone there. I lost my train of thought. The news coming out yesterday was rather interesting, don’t you think?

Ian Rassman (12:00):

On the rescheduling? It’s quite interesting to see a proposal from the federal government to reschedule from Schedule one to schedule three. This is clearly a step forward. It’s not really everything that we’re hoping. I think that cannabis needs to be descheduled not rescheduled, and it needs to be treated more like alcohol. Let’s verify a certain age and then let’s make it adult use friendly. So yeah, been a lot of news on that, but I don’t know that we have any that we’re going to see any progress on safe banking anytime soon. We don’t really have the bulk of our leadership supporting it.

James Huber (12:40):

Yeah, I mean, I think one of the issue is it’s still very polarized living in California. I grew up in Vermont, it was very, I

Ian Rassman (12:49):

Grew up in Vermont. I didn’t know that. Oh,

James Huber (12:51):

Great. So it was very normal, the full length of the word. So in California, I’ve been going to a bunch of concerts lately, and they’re not even enforcing it. They’re just going do your thing, whatever. But if you go other places, I mean, how dare you drink or smoke and they’re getting wasted in the middle of the day and they’re still dry counties in Kentucky, Utah, yeah. Maybe I don’t even know if there is in Utah to, but there’s still this stigmatism behind it, and I felt like we talked about this a little bit of it might start to wash out because the hippie bashers from the sixties and seventies chasing around from Dazed and Confused, looking at Paddle the stoners, I think that’s getting gets washed out. But I don’t know. I don’t spend a bunch of time in the Midwest, unfortunately. I don’t know if that’s shared.

Ian Rassman (14:04):

The culture is certainly different in different parts of the country. Here in California, places like L A X and San Francisco have come out with San Francisco airport, have come out with clear policies on cannabis. They’re like, we’re hands off. We’re looking for bad guys and terrorists and weapons and all that, and we just don’t care about your cannabis. That’s the stated policy at L A X and S F O and several other California airports. But God help you if you get on that plane headed to Texas, you get off off that plane with your California legal cannabis. I would not recommend that. Right. So yeah, different parts of the country, extremely different attitudes on it

James Huber (14:50):

And that that’s part of the problem. If you’re a politician voting on this, you don’t want to be the person that people are very vocal when they’re like, no, I don’t know if people still say that’s a gateway drug and all of that, but I think to have full acceptance, you really need something at the federal level because you don’t have the banks. They’re all risking it. And although what I’m seeing, and we write a lot of opinion letters on different ways to do this business. I think about a month ago and Visa came down or I can’t remember Visa or MasterCard off the top of my head, that’s no more pinned debit and I’m writing opinion letters and people are coming up with their ideas on running scripts, running crypto, running this, that. The other thing, and I’m going, my opinion is safe banking has not passed, but that is very clear framework of we’re going to leave this alone. We’re not going to touch it.

Ian Rassman (15:57):

Yeah, I think a lot of us are putting a lot of stock in safe banking, but I don’t know how close we are to getting there. And if we had something like Safe Banking, I don’t think that we would be seeing these sort of announcements from MasterCard we saw a month ago about how they don’t want their platform being used for cannabis now. It’s not the first time. We’ve heard this from MasterCard, and it won’t be the last time Visa regularly comes out with announcements as well about this. And all the card brands come out with somewhat regular announcements. It sort of seems to be a regularly scheduled event. And I would say that it’s almost always in the last two weeks of December, as we’re closing in on the end of the year, it almost seems like somebody in compliance is like, Hey, we got a problem over here.

Ian Rassman (16:50):

Send out an email. Tell everybody to cease and desist. And okay, we’ve sort of done our job now by telling people not to do this. And that’s sort of how it feels to me. But it seems regular that these announcements come out because we are all operating in this gray area. The states have told us we have our state’s rights, we can do what we want, make our own laws. And the federal government is like, well, we don’t really care. So there’s this great ambiguity in this gray area that I think if the federal government were to come out with something like safe banking and basically say, Hey, if you’re running a state authorized program, we’re going to leave you alone. So that would be really a watershed moment. I think in the entire industry, banking payments, loans, taxes, all this stuff would open up given safe banking. So it has the potential to be a huge panacea of change. And then it also has the potential to leave us all languishing and waiting for it.

James Huber (17:54):

Right. Well, one thing that I love about being a payments attorney is anytime there’s change, it gets exciting. And so like you’ve said, is this industry has been changing quite a bit, almost regularly scheduled. The one thing I saw that was different about the pinned debit announcement was that MasterCard actually said, shut these down and send me confirmation, as opposed to a visa memo saying, cashless ATMs no good. That’s all for now. Yeah, no enforcement whatsoever. I’m not aware of any enforcement coming on the cashless a t M side.

Ian Rassman (18:34):

I’m also not aware of any enforcement coming on really any side on this. Well, it can happen mean that’s the threat that everybody’s living under is that enforcement suddenly does happen. And you don’t want to be on the receiving end of enforcement from the federal government do.

James Huber (18:53):

No, you don’t want to be the test case. But I’ve always told people, even if you are the test case you are in, maybe it’s second year of law school, glory argument of state’s rights versus the government rights, and when it was medical, they’re not going to touch it. That’s a state, right? Hands down recreational. I don’t know. And I don’t know what happened with prohibition, but I would imagine that was the same thing. I think everyone was just like, oh, to just ignore that rule. But if they were to enforce the marijuana rules, and I’ve only heard of one almost attempt, and I think it was in the beginning of Obama when nothing was happening or he wasn’t able to make anything happen yet he hadn’t got his traction. They were going to do a raid on an enforcement on a large marijuana conference, and then last minute they bust everybody onto an Indian reservation, and that was the only time that they had the 80 SWAT cars lined up and they’re ready to make a run. And then somebody gave them a tip and they’re like, oh, we’re over this line now, so you can’t come get us. But I don’t see it happening. I could see if that happened. Let’s say I am big dispensary, they go after Med men or they go after a bank. I could see organizations like normals being like, here’s our attorneys. We will fight this fight for you. Is that right?

Ian Rassman (20:25):

Yeah. I think certainly organizations like Normal and whatnot will definitely step up to support this sort of effort in any way that they can. Yeah, the enforcement certainly is interesting. You really, really don’t want to be on the end of any enforcement issues from the federal government do.

James Huber (20:53):

No, I mean, and right now you have a drug conviction that affects your ability to do all sorts of things, get loans and things like that. Well, so where are we at right now with payments? I mean, some banks are touching it. It’s mostly still the state chartered banks that have the

Ian Rassman (21:15):

Chartered banks and credit unions are the biggest ones that are still in this,

James Huber (21:20):

And are they making a lot of money off of it? They make money off their deposit accounts, the payment processing. I don’t think a lot of banks have still figured out how much money they can make, particularly the credit unions and those guys. But they should be doing pretty well off of the deposits of a dispensary, especially if you’re telling me that, well, did you say that marijuana sales are outpacing taxes, but that’s not gross dollars. People are still buying more, not Bud Light, because no one wants that

Ian Rassman (21:54):

Anymore. I think it was the tax revenue was the statistic that the tax revenue is bigger. So I mean, we all know that it’s taxed, disproportionate from any other product that we’ve ever even seen hit the market in pretty much every state that it’s come out in. Take a look here in California, our taxes are out of control, and that drives the illicit, unlicensed, unregulated market to higher extents. Everybody’s going back to their guy like, oh, I’m just going to call my guy. I’m not paying 60 or $70 for an eighth.

James Huber (22:30):

Right? Right. So right now, I mean, my understanding before pin debit was great. People were scared about the cashless ATMs, but my understanding is that’s pretty much the only solution right now. Unless you’re miscoding the transaction and you’re jumping around from square to Stripe or whatever and you’re up and down, but then banking is still a huge issue for people. I mean, what are you seeing in the market present day?

Ian Rassman (23:06):

You’re right. There’s no s i c code for cannabis. There’s no way to code it. Cashless a t m, there’s been crackdowns on cashless A T M as well. Everything’s been cracked down on a little bit and then pulled back. But you’re right, cashless ATM seems to be really sort of the tried and true, longest lasting solution so far. There are still options for pen debit and any other payment systems that are not explicitly against the card brands or Visa MasterCards rules that they don’t want to participate in the cannabis industry. Why don’t they want to participate in the cannabis industry? It goes back to what we were talking about before, the ambiguity. It’s just that there’s no clarity on whether it’s okay for them to do this. And I think in the larger context of how much money the card brands make off of every other industry on the planet, they make all the money, a lot of money on all these things, and what fraction of a percent is the cannabis industry compared to everything else that’s out there? It’s pretty small. So I don’t think that they’re willing to stick their necks out for a smidgen of revenue that’s not really going to make a big difference on their bottom line, and they’re going to be subjected to more or less a harassment by the federal government. So they’re mostly just avoiding it.

James Huber (24:43):

Yeah, I can see that. What about any peer-to-peer solutions? We’ve helped write and launch so many over the years, and they’re going, well, the customers just don’t want to do it. They don’t want to deal with it. I have a hard time believing that if I go to a venue and I buy my tickets, I have to download their app to do that. I don’t see what’s the pushback on that is that people are too high and they can’t figure it out.

Ian Rassman (25:18):

I think that we all just want to pay for things like we’re used to. You want to pull out the plastic that’s in your wallet and buy your stuff, and certainly this is what the retailers want us to do. Look at, I tell all my cannabis clients, look at what Walmart and Kmart are doing. Sorry, Kmart’s gone look at Walmart. What are they doing? When you go into Walmart, they’ve created an environment where you walk around and you do spontaneous emotional purchasing, right? You see something and you’re like, oh, yeah, I definitely need one of those. And oh yeah, I forgot that I wanted one of these. And you start throwing stuff in your cart because you’re not limited to the cash that may be in your pocket. So you’re not sort of walking around Walmart going, okay, 7 99 and this one’s 1250, and you’re just keeping this mental tally to keep it under the $80 that you have in your pocket.

Ian Rassman (26:11):

That’s crazy. Nobody goes to Walmart like that. That’s great point. You go to Walmart, you get what you need because you know when you get to the end of the checkout line, they’re going to have a dozen different payment options for you. Oh, you want to tap, you want to Google Pay, you want to Apple Pay, you want to a t m this? You want a credit card? This, it’s every option available. And this is the best case scenario for the merchants. You don’t want to dictate to your customers how they pay. It’s not your job as a merchant. Your job as a merchant is to sell more stuff and take whatever money they want to give you. And so I remind people that all the time. So you do want to have good options on your payments and don’t railroad your customers and say, oh, we only do this because you’re going to run into people that aren’t going to do that take, just take my poor mom as an example.

Ian Rassman (27:05):

She hits those roadblocks where they’re like, oh, well, you need to download our app. And the first thing that happens, I get a phone call, Ian, help me get through this. I’m stuck. I need to buy this and I don’t know how to buy it. These are all the roadblocks that nobody wants in their way. And the reality is that a lot of people struggle with some of those roadblocks, and I’ll be honest with you, they kind of annoy me too. I get annoyed anytime I have to go outside of what I’m expecting to, how I’m expecting to be able to pay. I’m a big air miles collector, I throw down my Amex card on everything, and I get that sort of indignant feeling when somebody’s like, oh, well, we don’t take American Express. I was like, I get a little huffy. I’m like, oh, I want my air miles. And we all do. We all want our points. We all want our rebates, we all want our miles, we all want everything. And this is what we want as consumers. And so when I spend money somewhere, I want to pay for it how I want to pay for it, and I don’t really care about anybody else’s opinion. I know how I want to pay for things.

James Huber (28:13):

Yeah, that’s a really good point. I mean, even if you’ve got an A t M in the store and I go in and I take out a hundred bucks, and then I walk in and I’m like, oh, gummy this running down the aisle filling my cart. And they’re like, that’s $7,000. And I’m going, oh, well, I only have a hundred and they’re, I put it all back. It’s a really good point. And so one of the things that I’ve always taken issue with the memo that came out that’s saying, no more cashless ATMs. I’m going, wait a minute. There’s an at m right there, and you probably know where that ATMs is, and I know that people move their ATMs around and there’s allegations that you say, put it over here and they move it. But even still, you can figure out where that at t m, how come you’re okay with that ATT M sitting right over there and you have a problem with the one at the cash register?

Ian Rassman (29:08):

I just enough separation between the two where there can be some reasonable doubt. I think that that’s what’s going on there. And by the way, I want to go shopping at a dispensary with you seven grand. Let’s go.

James Huber (29:21):

I haven’t been to a dispensary probably since last week. No, since it first went legal. I think I was like, I got to check this out. And I couldn’t believe it. Actually that happened. I went to Washington and I was like, oh my gosh, look at what you can do. And they’re like, you have to go run across the street. I was in Washington, so it’s pouring rain. Of course I’m soaking wet. I come back by the time, I’m like, who even cares at this point?

Ian Rassman (29:51):

Isn’t it in Washington DC where you buy a t-shirt and then they give you some free cannabis? You buy a $70, you buy your $70 and then you get your eighth,

James Huber (30:05):

Right? I mean, that’s kind of like running a script transaction too, is the same thing. Buy this piece of paper and cash it in, but it all ends up at the same place. Alright, well, we’ve been going for a while now. Where do you think this is going? What’s the future in cannabis payments? I mean, we all hope safe banking passes. It all comes from the top, unfortunately, let’s say wild hair. The incumbent candidate stays in office another four years. Do you think he’s going to touch this

Ian Rassman (30:44):

Hard to know what that guy’s going to do? Maybe if he owns some cannabis businesses, we’d see something move forward? I don’t know. I don’t know how much energy any of our politicians have to put into this. This is really an issue of freedom, and I’m disappointed that our politicians are not seeing it that way. At the end of the day, this is plant medicine. These, this plant has been growing in the ground for 10,000 years and humans have been consuming it for 10,000 years. And yeah, we’ve been mostly fine from it. This whole prohibition era that we’ve entered into in the last a hundred years is completely artificial creation. This plant’s been around for a long time. People have been picking it and rolling it and smoking it from forever. So where’s it going to go? Ultimately, I’m sure that, and I really have no idea on the timeline that this is going to take.

Ian Rassman (31:52):

In fact, interesting story. As I told you, normal is 53 years old. So I remember about seven years ago when the adult use market was really starting up in California. I had a conversation with Keith Strop. He’s the guy that founded Normal in 1970, and he was out here in LA and I met up with him at a party and I was talking with him and I was so proud of our California market. I’m like, all right, Keith, so tell me, you’ve been fighting this prohibition for nearly 50 years now. What do you think? And I was all excited. I’m like, what do you think about our California market? And he’s like, yeah, yeah, good positive changes. And I said, did you ever think that? I said, if you knew that you’d be working on this for 50 years, and we’ve only gotten to hear, would you still have started working on this 50 years ago?

Ian Rassman (32:46):

And he says, Ian, I’ll tell you something. When I started normal in 1970, I always thought that we were at maximum five to 10 years away from full federal legalization. I was like, wow, how about that? Okay, so here we are, 2017 adult uses in California, the world’s fifth largest economy. Now how long do you think we are from full federal legalization? And he looks at me completely serious, and he says, probably five to 10 years. So this man who has been in this arguably longer than anybody on the planet, hasn’t changed his opinion on we’re still five to 10 years out. So I certainly don’t have much more experience than Keith’s drop. So I have to acknowledge his opinion there. It’s hard to say when we’re going to get there, but when we do, what will it look like? What will the payments landscape look like?

Ian Rassman (33:45):

I think it will normalize, and then it will become a race to the bottom as it is with every other industry in the credit card processing space. As we all know, there’s always some payments guy knocking on your door telling you, oh, you’re paying 2.9%. I got you at 2.8. Come on over. And then another couple months, somebody shows up with 2.7 and another guy 2.6. It never really stops, does it? So it is a race to the bottom, like all the other industries. And I would, when we get there, which is still sometime in the future, I think I would caution merchants not to participate in that race to the bottom. As we all know, when, if we go out of town this weekend, you can stay at a hotel. You got a lot of choices. You can stay at the Ritz Carlton, pay a lot of money, get a lot of quality service and extras, or you can stay at the Marriott, go kind of more middle of the road, or you could go to Motel six and walk in and it’s as cheap as can be.

Ian Rassman (34:52):

And there’s really no services or anything like that. Payments is the same way. So you don’t want to get yourself down to the point where you’re paying Motel six pricing and you’re getting Motel six service. Now, I’m not picking on Motel six. I’ve stayed there plenty of times, but you just should know what you’re buying. You don’t pay for Motel six and think that you’re getting service like the Ritz-Carlton. That’s not the reality. And that’s where we’ll get to one day, I think in the payments industry is where it’s just a race to the bottom on pricing, and then the service slowly starts to slip away. And then one day you’re paying so little on your overhead that you can’t get anybody to pick up the phone for you. Yeah, I mean, it’s a good

James Huber (35:36):

Point. I think of one of the benefits of some of the companies that we’ve worked with in payment processing for marijuana and C B D is all the compliance tools that they’ve built into their systems. They’re helping you hit your reporting, helping you manage your staff, making sure that there’s no allegation that you’re paying them in the product or things like that. But you’re right, we’ve seen it in many other highly regulated industries. They’re going just down, down, down, down, down. And I’ll just bring in this side software to do all of that. But I agree with that. So we are running short of time, but I did want to hear a little bit about your nonprofit. I thought that was one of the more interesting businesses that I’ve heard in the cannabis space. So why don’t you tell us a little bit about that.

Ian Rassman (36:28):

Sure. So Los Angeles normal here behind me, this is my nonprofit. We’re a 5 0 1 C three educational company. As I sort of mentioned, normal’s traditional role over the last 53 years has been fighting for consumer rights in cannabis legalization. I live in Los Angeles. There’s no doubt that we are the largest cannabis friendly city on the planet by a long shot. So sort of when I was getting started with my team, we all kind of decided that nobody really had the energy to run down to City Hall and be knocking on the door and saying, oh, the Los Angeles cannabis laws are not any good, and we need improvement here and there. I mean, they’re not so terrible here in LA when we talk about places like Texas. So we decided what are we going to spend our energy on? So in March of 2003, California enacted Senate Bill number 34, also known as the Dennis Perone and Brownie Mary Act. These are two absolute legends in California cannabis culture in the eighties and nineties when the AIDS epidemic was really picking up speed and taking out a lot of people. These two were up in San Francisco giving out in Brownie Mary’s case, brownies that were loaded with cannabis.

Ian Rassman (37:55):

And Dennis prone was very active in the gay community, and cannabis was noticed very quickly to be helpful for the wasting disease that all these AIDS patients were suffering from. So these two, there’s no doubt that they changed the opinion of cannabis in California because they constantly talked about cannabis being a medicine. It’s not a drug that you’re injecting up in your arm. This is a medicine that helps people. So this concept of cannabis as a medicine, I think is hugely important to the movement and into changing the stigma both at the state and at the federal and at the international level. We’ve got to keep talking about this as a medicine. So my team and I decided to really take advantage of this legislation, which is completely unique in California. Nobody anywhere else on the planet is able to do anything like this. Here in California, the licensed industry is allowed to donate product back into the communities that they serve.

Ian Rassman (38:59):

So this is very big. My team and I have been raising awareness that this is a possibility to do this and bringing on more and more partners to donate medical products to the people that need them. And over the last three or three years, we have donated over $6 million worth of medical cannabis to veterans, cancer patients, lupus, Crohn’s, ms, Parkinson’s, all these things that people suffer for. We’ve been donating cannabis as a medicine. So it’s not sort of the traditional fighting for the proper laws, it’s more about fighting the stigma. So that’s the mission that we’ve taken up. We feel that it’s a beautiful mission of love, light, and mercy. And I think that this is what’s going to help us get to what we’ve been talking about about federal legalization. We just need to change everybody’s attitude that this is a medicine. And when you talk to the veterans, veterans are by far the largest group that we donate to.

Ian Rassman (40:01):

And you hear the same story from veterans every single time. They always tell you that the VA will give them unlimited amounts of opioids. All they got to do is walk in and ask for another bottle, and they get handed a bottle and then they go home, and then they sit on their couch just watching their life pass them by while they’re taking these opioids. And what you hear from the veterans is when they stop the opioids and they switch to cannabis as a medicine, that they get up off of that couch and they start reengaging with their friends and their family and their loved ones, and they start living their best authentic life. And we know that there’s an opioid crisis here in America. We hear about it all the time. So a program like this that helps reduce opioid use is really a win all the way around.

Ian Rassman (40:46):

And when you see these veterans talk about what it means to them, it’ll make you cry. It is absolutely tear jerking, and it pulls at your heartstrings. And nothing makes me happier than to sort of be in that environment and see the recipients of these donations get in their bag. And when they get a bag, we do this, for example, once a month at American Legion Post in Monterey Park. We serve about 50 veterans every third Sunday. And because we partnered with an American Legion Post, it’s easy to find the veterans. We know where they are. And when people come in, not only do they get a bag of medicine worth between four and $500 on average, but they also get a community and a peer group where they get to sit down and talk about what does this medicine mean for me and how is it helping me with my life? And so when you sit in on this and you hear them talk about this, it’s really amazing. So I’m thrilled as can be to be giving away wheat. What a great little side hustle, giving away millions of dollars worth of wheat. I can’t even tell you how thrilled I am about it. It’s exciting.

James Huber (42:04):


Jeremy Stock (42:05):

Ian Rassman, it’s been awesome. Sorry James, didn’t mean to cut you off there. Go ahead. I was just going to say it’s been awesome having you as a guest, those of you listening right now, you can find That’s R A S S M A Ian, we really appreciate it. James, last word.

James Huber (42:22):

That’s it. It was great. I’ve got to run. I want to find out where you grew up in Vermont, but I’ll do that offline. I’m running a little

Ian Rassman (42:27):

Late for a meeting. We’ll catch up after the show. But we got some fer Vermont stuff to talk about. Who would’ve thought.

James Huber (42:32):

Sure do Love it. Alright. Thank you, Ian. Thanks, Jeremy.

Ian Rassman (42:35):

Thank you so

Jeremy Stock (42:35):

Much. Thank you so much.

Ian Rassman (42:37):

Thank you so much, guys.

Jeremy Stock (42:38):

Thank you for listening to this episode of The Payments Experts podcast. New episodes first and third Thursdays. If you’re interested in learning more about PEP and how Global Legal Law Firm may be able to assist you, please visit us at global legal law To schedule a free consultation, give us a call at (888) 846-8901 or email us at And once again, thank you for listening. 1, 2, 3. Come on.

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