Paysafe, the online payment processor with a foothold in the gaming industry, has hired its first federal lobbyist to promote the U.K.-based company’s agenda on cannabis transactions, according to federal disclosures filed Jan. 26.
Dina Ellis Rochkind, of counsel to the Paul Hastings government affairs team in Washington, reported that she will lobby on “cannabis and related financial services issues” for Paysafe Merchant Services Corp., a Paysafe subsidiary in New York.
Dina Ellis Rochkind
Neither Rochkind nor a Paysafe representative responded to messages seeking comment Monday. A Paul Hastings spokesman declined to comment.
Nontraditional payment service providers have flocked to serve a state-legal cannabis industry that remains largely shunned by major banks, which fear federal money laundering charges should they serve marijuana-related businesses.
Companies such as Hypur Inc. and Tokken Inc. have taken various approaches to tracking and handling cannabis transactions online to entice legal industry operators shut out by banks and eager to avoid processing huge sums of cash.
Such ventures drew new attention this month after U.S. Attorney General Jeff Sessions rescinded the Cole memo and other guidance for states where marijuana use is legal. Obama-era guidelines for financial institutions serving the marijuana industry remain in effect, although the Financial Crimes Enforcement Network’s guidance relied on adherence to Cole memo principles. Thirty-one members of Congress signed a letter earlier this month urging U.S. Treasury Department officials to retain the financial guidelines.
In California, a state senator introduced legislation last week to create a state-chartered bank to serve the cannabis industry. The bill by Sen. Robert Hertzberg, D-Van Nuys, still lacks specifics and does not address how such a bank would be capitalized or how it would be insured since federal institutions would be unlikely to provide backing.
California Treasurer John Chiang, who convened a committee last year that studied cannabis banking, on Tuesday is expected to announce “next steps in exploring creation” of a bank to serve the industry.
Rochkind joined Paul Hastings in April from the office of U.S. Rep. Mike Coffman, R-Colorado, where she had been Washington director. She previously was in charge of government affairs for Quicken Loans and, earlier, director of government affairs for Chrysler Group. Rochkind focuses on financial technology and payments.
“Government relations continues to be an important, if not critical, area for our clients, many of whom are transforming their business models to adapt to evolving statutory and regulatory obligations and the technological revolution currently remaking financial services,” Paul Hastings partner Chris Daniel in Atlanta, co-chair of the firm’s payment systems practice, said in a statement last year announcing Rochkind’s hiring.
In New York, Paysafe engaged the government affairs firm Bolton-St. Johns for three months in 2017—at $15,000 a month—to advocate for the company on legislative and regulatory issues.
Paysafe had a brief lobbying presence in California between 2013 and 2016. The company retained Nielsen Merksamer Parrinello Gross & Leoni for work on a handful of bills dealing with online gaming, including regulation of daily fantasy sports. The New York Times reported in July that approximately half of Paysafe’s revenue comes from online gambling and gaming.