Legal cannabis is coming to America, and you can take that to the bank.
Unfortunately, cannabis businesses still can’t take their money to the bank. Which is a big problem that Senator Elizabeth Warren and nine of her Senate colleagues are trying to mitigate.
The Associated Press and LA Times report that the senators are sending a letter to a key federal regulator, the Financial Crimes Enforcement Network, seeking additional guidance to help banks provide services to marijuana shop vendors.
Warren, a member of the Senate Banking Committee, sees several obvious benefits of helping marijuana-based businesses move away from a cash-only model and enjoy the benefits of legal banking.
“You make sure that people are really paying their taxes. You know that the money is not being diverted to some kind of criminal enterprise,” Warren says. “And it’s just a plain old safety issue. You don’t want people walking in with guns and masks and saying, ‘Give me all your cash’.”
The highway robbery worries stem from the regulatory hot potato of state vs. federal jurisdiction. While 28 states have legalized marijuana for medicinal or recreational use, the feds still classify marijuana as a Schedule 1 drug on par with heroin.
Taylor West, deputy director of the National Cannabis Industry Assn., a nationwide trade organization for marijuana businesses, agrees that access to banking is a top concern.
“What the industry needs is a sustainable solution that services the entire industry instead of tinkering around the edges,” says West. “You don’t have to be fully in favor of legalized marijuana to know that it helps no one to force these businesses outside the banking system.”
It’s a lesson that’s crystal clear for California politicians trying to fast-forward a sound legal strategy for what promises to be a billion-dollar industry statewide come Jan. 2018.
That’s why California Board of Equalization Chair Fiona Ma tells us (mg magazine cover story, December 2016) she’s determined to fix the woeful state of nonexistent banking for the cannabis industry, noting the absurd fact that, “There are billions of dollars circulating within the United States because the industry cannot put it into a bank legally.”
Also trying to cut through the regulatory kudzu is California Treasurer John Chiang who highlighted some of the problems in an open letter, asking President-Elect Donald Trump for clarification of his position:
“This conflict between federal and state rules creates a number of difficulties for states that have legalized cannabis use, including collecting taxes, increased risk of serious crime and the inability of a legal industry under state law to engage in banking and commerce.”
No word yet, however, on whether Donald Trump’s reputed business savvy will extend to the cannabis business.
