Oh, how many times I’ve wanted to write my heart about having an adult business and dealing with the whole banking system. Ughh. So much heart ache and hair tearing, and my experiences were nothing compared to others.
One thing I know though… if you are in the throes of adult business banking headaches, the best you can do is ask your friends who they use and if they accept you. I’m grateful I only remember a few big brush strokes, cause the aggravated dealings happened so very often. And how are you gonna be a business without a freakin’ bank? Huh marijuana industry??? The government loves entrepreneurs, manufacturers… unless they make dick (or some other sin-sational product).
Banking has always been a bit of chaos for my businesses. Back when I was on the road as an independent contractor, managing booths at art and renaissance festivals, I had three bank accounts. We had these so we could do banking in Florida, Colorado, Minnesota and Texas as well as California. Weekends we’d bring in a lot of cash and in the 90’s, right as we large cash deposits you had to sign paperwork swearing it wasn’t drug money. No one had a problem with pewter money, and I didn’t really seem like the kind of drug lord, but I’d drive to a bank on a Monday, a little fair hung over (think of a weekly convention drop), my ones and fives and tens and twenties all counted out and bundled, sometimes the hundreds as well. We never turned in coins as we’d need to be making more change the next week. We always kept a cash drawer of about $130. And if we had a good weekend, we’d have over $10,000 to deposit. I’d send the bulk in a check I overnighted to the company I worked with. It was easier to be a part of a bank rather than a stranger randomly bringing lots of cash. Norwest was great, service was friendly. Phone issues were nicely addressed. They had branches in Minnesota and Colorado so we did a lot of banking with them.
First thing Tantus did, once we had a DBA in Colorado, was open a bank account. We were not a cash business. We deposited checks regularly and we wrote checks. It was 1998 so there were no auto drafts going in or out. We opened up a new business checking account at Norwest. In Colorado we were simple. We didn’t even accept credit cards. Everything was on net30 or COD through UPS. We flew under the radar of our land lord, our bank, of being 10 miles from Focus on Your Own Damned Family at its peak. Then late 1998 Wells Fargo acquired Norwest. I remember the bs the bank cashiers told me, how it was Norwest that was gonna run the bank even though the name had gone Wells Fargo. Good bye customer service with a smile. Good bye phone customer support.
I remember actually closing that account finally. It seemed risky to close an adult business bank account once you had one. We’d kept it when we’d moved to Chula Vista but why? I have no idea. The service was horrible for businesses our size, even if they had no idea what we did. I’d been given disservice one too many times. Wells Fargo was no longer our main bank account, we’d just not gone through the process of closing the damned thing. I filled out the forms. Done and done.
In San Diego we found U.S. Bank. And for a minute they were pretty good. They actually came to the dildo factory to meet us. Everything was kosher. A year or so in we decided we really did need to accept credit cards. We were up to our neck in late payments from our very liberal net30. We were small and the bigger companies were notorious for slow paying their vendors. The bigger we got, the worse our financials became. Credit cards were the answer. We’d even give discounts for payments with credit cards. Honestly credit cards during the recession absolutely saved our asses.
We went into U.S. Bank and their business banker was nothing but smiles. They knew us, we brought checks in all the time. Credit Card Services, “We totally do that. Let’s set you up. Done and done.” Until three months later when corporate realized what we made. Then, we were cut off without a thought. We’d just gotten our customers paying and now… limbo.
I remember scrambling and reaching out to friends. Dan and Shay at Vibratex told me about Redwood who processed their credit cards. We made a call and set it up. It was a little more expensive. Credit Card services are a set fee per charge, a nickel or a dime, plus a percentage of sale. So maybe it was 7 cents back then instead of 5 cents per charge, but they got us up and running and I was incredibly grateful.
As clerks and managers came and went, the bank turned hostile. When the credit card thing happened, our local bank was as shocked as we were. I mean, they knew who we were, they’d been in the building. When that crew was gone though the focus of the local store front refocused towards being a “family bank”. They minimized business services at least at our branch and most memorable was the time I went in to make a deposit and the business line was empty. I walked up to the patrician that made the business dealings private from the general lines, and the clerk behind the locked door looked at me, waved her finger no as she moved her head from side to side and pointed me to the long general line. It wasn’t just that the line was closed, it was her surly attitude. I ripped the paper sign off the plexiglass that read “Business Banking Hours 10-2” and pointed at that back at her. I got a clapping ovation from the general line. Turned out most of them were there to do business banking. Funny end to this story was that next time I came in, they’d taped the sign back together and affixed it to the same spot. The sign was just a white letter printer paper. Couldn’t they print a new sign?
I should have warned you: I’m really nice until I’m not.
In 2008 we started a home party company LoveU. Another banking headache. This time though we had a friend. He’d left adult and gone into sales for a credit card processor. What luck. What could go wrong. Right as we started got our first representatives, our first sex educators kits ordered, our first parties going, all paid via credit cards… nothing processed was hitting our bank account. Three weeks we waited. We couldn’t get any straight answers. Our friend actually yelled at us and hung up on us. We scrambled and got back with Redwood and we took a loss for all those first charges. It was the cost of being an adult business…
Still, it’s a pain in the ass to change banks. We learn to put up with our business partners no matter how horrible they treat us. We get used to their nuances, do they bundle 5’s in stacks of 20 or 25 (I’ve been at banks that did one or the other), do all the ones face the same way, the tall gawky cashier is really funny, don’t bother to ask the woman with the pussy bow shirts anything, she just has to ask someone else, might as well go directly over her head.
At some point at US Bank things actually started getting hostile. “You’re lucky we even let you bank here” I was told by a manager. And the straw that broke the camels back was in Reno, where we had relocated, when we wanted to open a second account as a holding account so that credit cards funneled through and we could sort all the banking from two different credit card processing companies. It was then we were told in no uncertain terms “No. You only have the business checking account because it was grandfathered in.” Well, thank you very much.
I think it was about this time that Adam and Eve Corporate, PHE Inc, reached out to us. Tantus sold the first silicone toys (the Little Flirt) in the mail order catalog, the business that fought postal services in multiple states simultaneously and made shipping sex toys across state lines legal. They too banked with US Bank. They had banked there since they began in 1971. But sometime around 2011, US Bank sent them a letter. They had three months to find other banking as their accounts would be shut off at that time. They were the number one retailer and had so many fingers in so many pies, catalog, web, film, gay, leasing their name for their own branded sex toys, etc… and in one swoop. No more banking. They found banking, but not from us. We didn’t know where to send them. But after US Bank wouldn’t give us a holding account, we were on the hunt ourselves.
By this point we were much more knowledgeable about banking services (we hired outside industry people who were more in the know). Dan our CFO was the best of accountants (and later the worst, but that was a battle that’s tale is not for public consumption and I hope he’s doing well). He made outgoing calls to several banks and had their business managers come to present to us. We were paying through the roof for services by now. Fees for all the things. We should be able to get services for the amount we were paying. First up was The Bank of Omaha. Everyone had recommended them. They had an amazing reputation in Reno for being the bank that worked with you. Unfortunately, when they showed up at our conference table, they told us unfortunately, they didn’t want our dildo making business. No worries, two more interviews to go. We would find the right bank. The ethical bank that understood that pleasure was not immoral. One of the other banks sold us a great story. It was Umpqua who was new in Reno. They were very customer service oriented and embraced our business. They even had a telephone in the office that went straight through to the CEO of the whole organization if you had any complaints. They loved their bank. They were a mission-based business. They sold it thick and syrupy and we bought. We immediately opened the bank accounts and began transferring all our income channels and our bills. And yet… two weeks later while they deposited everything, they wouldn’t pay out a damned check we wrote. Three weeks later… same. At this point Dan was livid. He went into the bank got on the phone and no one picked up but he left a message. Ugh. All the sales people had left the branch. In that little time, there was no one we’d opened the accounts with that was still there and really, they could care less about our business.
One of the best things we had done when we moved Tantus to Reno, was the way we responded when a potential realty deal fell through. We had found a warehouse. It was 2010 and Reno was a warehouse ghost town but we had weird needs of actually needing office space in our warehouse and that was not so common. We’d found a place for rent with neighbors in the warehouse building that sold slot machines and that brewed beer. It wasn’t perfect, but it would do. We’d signed a lease. It was executed. And then next day- we got a call from our realtor who was so mad he was spitting into the phone. He’d never had any thing like this happen. The institution that owned the building, wanted to know how they could get out of the contract. “Rip it up” I told them. It would have been some nice cash in our account making them pay, which was our legal right. Instead, we earned the respect of “Old Reno.” We had people who vouched for us in ways we never knew. And when a few years later we were struggling for banking Old Reno showed up at our door.
There was a brand new business bank in town. It was a Nevada bank with branches in only Vegas and Reno. It was founded by a Fertitta from UFC and Andre Agassi with the owner of the Las Vegas Sun. The Reno branch was just opening and it was run by bankers who’d retired. They’d been the bankers who’d left the Bank of Omaha that had been so recommended. They were straight with us. They were not a personal bank. They were a business bank. And if what Tantus did was legal (and dildo manufacturing absolutely was) we would be absolutely welcomed.
I’d never gone to lunch with my bankers before. I did several times with Howard and Denny. We belonged to the same fishing group as Denny and camped with his family. If my signature looked funny on a check, they called. When we’d accidently over drafted one account, they called immediately so we could transfer funds. When we asked for a line of credit (omg yes, we dared to ask) they actually gave us one. When PPP funds were available, they gave us amazing services including staying until after 9 pm the night of the first cut off to get all applications (including ours) in. My son, in kindergarten or first grade, came with me into the bank after a difficult day at school, he walked straight into Denny’s office and confessed his misdeed that he got in trouble for. I could only assume it was a trial run at confessing to his dad.
After nearly 20 years, our bank was one that actually worked with us. If your business is in Nevada, or Phoenix AZ I can not recommend Meadows Bank well enough. Even after both Howard and Denny retired once again, the spirit of good partnership continued until the day we actually closed our business accounts. Closing those accounts actually made me cry.
Violet Blue wrote an in-depth story on banking adult businesses and the closings of accounts especially by Paypal and Square. I read her articles and I had questions. Afterall, we had affiliates whose accounts had been closed because they blogged about adult content. The real question was who rigged the banking system against us legal adult businesses. That was what she was after. Was it the banking corporations? Was it the FDIC? Was it the US Government itself? The article as much as she tried to get confirmations still gave no concrete answers. I had cocktails with her and asked what she thought. She admitted to having spoken with employees of the institutions that wouldn’t speak on the record- and she couldn’t confirm their confidences… it wasn’t comforting.
Being a small business is difficult on even the sunniest of days. When we moved to Reno, Nevada was hemorrhaging bankrupt and closed businesses, but to get an incentive to bring our business in we’d have had to have had 50 employees. We didn’t have 50 employees. We were the size of a small business. I think we hired something like 12, and all of those were well above minimum wage. Small businesses, manufacturing businesses, are crucial to local economies. They are the heart and soul of our economic development— adult or not.
Please, if you are in the industry please tell your banking tale… the only way we find change is to make it.
In good company.
Having personal accounts with Bank of America for more than 10 years, when it was time to look for a business bank we did what one expects -- go with who you know.
2009: Met the local banker and they were thrilled to have us.
2017: Without warning. Locked out of account; could not even view because the account was CLOSED. All funds frozen. Local banker said sorry there was nothing they could do.
3-months later: we get a check MINUS their fees including late fees for failing to pay credit cards on time (remember we can access or see accounts -- nor can we move money between checking to pay the credit card account).
Called Metis wherin she said to shop around for a community bank. We are in Texas. That was not going well. Approached Wells Fargo who had just been hit with fines for fraudulent accounts and the local banker called corporate and reviewed our situation.
Net-Net: Still going strong with Wells Fargo after 4-years but we don't keep all funds in that single institution for fear of a repeat CANCEL.
October 2022: PayPal just advised us after a local Fetish Flea Market that ll our transaction will be held for up to 30 days. Here we go again...
Thank you Metis for the opportunity to share.
I have no idea why the banking industry cares where money comes from, as long as it's legitimate. It seems like a bad business move on their part to shut out entire industries from their branches. Too bad I'm not a banker--it seems like an overripe niche to turn an easy profit...and all it would take is providing decent rates, a full menu of banking services, and good customer service. It's not like y'all are even asking for much.