Posted on February 14, 2014 | By Jake Ellison
Attorney General Eric Holder told Congress a couple of weeks ago that the Department of Justice and the Treasury would be issuing guidance to banks for the acceptance of money made from the legal sales of marijuana.
The DOJ and the arm of the Treasury in charge of those rules issued them today.
The rules are meant to help marijuana businesses avoid the potential violence and corruption that comes with a cash-only business, especially a business doing millions of dollars of transactions a month — as had already been the case in Colorado where legal sales of recreational pot began on Jan. 1.
“Now that some states have elected to legalize and regulate the marijuana trade, FinCEN seeks to move from the shadows the historically covert financial operations of marijuana businesses,” noted FinCEN Director Jennifer Shasky Calvery in a news release. “Our guidance provides financial institutions with clarity on what they must do if they are going to provide financial services to marijuana businesses and what reporting will assist law enforcement.”
What one pro-legalization group says – as stated by Tom Angell, Chairman Marijuana Majority:
“Today’s action is another indication that the Obama administration is making a good faith effort to accommodate new marijuana legalization laws that enjoy broad voter support. However, since the guidance issued today could easily be reversed by a future administration, it may not provide all the protections that people in the marijuana and banking industries need to feel comfortable moving forward. Until federal laws are actually changed, many state-legal marijuana businesses may still be forced to operate on a cash-only basis, which is not only inconvenient for them; it’s a public safety risk. The president should take advantage of his administration’s power to reschedule marijuana and should use the platform his office provides to build the case for further changes to marijuana laws in Congress.”
Here’s what our region’s DOJ attorneys had to say in a news release:
STATEMENT OF U.S. ATTORNEYS JENNY A. DURKAN AND MICHAEL C. ORMSBY
“Cash businesses such as marijuana distribution can be a magnet for criminal violence. Today’s guidance seeks to mitigate the public safety concerns created by high volume cash based businesses without access to the banking and financial systems. The guidance also seeks to prevent criminal organizations from laundering their criminal proceeds beyond the reach of law enforcement. The guidance reaffirms the expectation that states that have enacted laws authorizing marijuana-related conduct will implement clear, strong and effective regulatory and enforcement systems. That obligation remains. This new guidance also makes it clear that banks have an obligation to continue to report and not offer services to businesses that operate outside such strong regulatory and enforcement regimes.”
You can read the full document here.
