Banks Receive Federal Guidelines on Business Transactions from Legal Marijuana
The Obama administration has provided banks with federal guidelines for conducting banking transactions with legal marijuana sellers, enabling a legalized marijuana industry to operate in states that approve it.
Guidance issued last Friday by the Justice and Treasury departments is the latest step by the federal government to make banks feel more comfortable working with marijuana businesses that are licensed and regulated, reports The Intelligencer / Wheeling News-Register.
Currently, processing money from marijuana sales puts federally insured banks at risk of being charged with drug racketeering, so many banks have refused to open accounts for marijuana-related businesses.
But legal marijuana sellers that are barred from utilizing banks cannot safely deposit cash, leaving them vulnerable to criminals and robbery. Also, state governments that allow marijuana sales want a channel to properly receive taxes from legal marijuana businesses.
In response to the federal guidelines, the American Bankers Association said “guidance or regulation doesn’t alter the underlying challenge for banks. As it stands, possession or distribution of marijuana violates federal law, and banks that provide support for those activities face the risk of prosecution and assorted sanctions.”
As the marijuana movement continues to gain momentum and more states move to legalize marijuana across the country, more banks will be forced to contend with this issue.