Latest Effort to Open Banking to Marijuana Businesses Sputters Out
One of the biggest challenges of running a legitimate marijuana dispensary or business is the lack of access to banking services. Because of federal laws that still consider marijuana an illegal, Schedule I narcotic with no medicinal value, banks have been reticent to extend services to any operation that is exchanging marijuana for currency, for fear of getting hemmed up on money laundering charges.
The result has been that marijuana dispensaries and businesses operate on a cash-only basis – despite the fact that more than half the U.S. population now lives in a state or jurisdiction where the drug is legal at least for medicinal use. These consumers want safe, legal access to the drug via a well-regulated business. Denial of banking services has made this tough.
Then, it seemed as if there might be some change. In June, the Senate Appropriations Committee voted 16-to-14 to give banks express permission to extend financial services to the marijuana industry. Unfortunately, the House nixed the move – for now, at least.
As representatives with the Drug Policy Alliance have noted, this is troubling because there is a growing recognition that when you have marijuana companies daily handling major quantities of cash with nowhere to safely deposit those funds – that gives rise to public safety concerns. It’s the responsibility of Congress to tackle this.
However, the Republicans in the House Rules Committee blocked a vote on an amendment introduced by Rep. Ed Perlmutter – the Fiscal Year 2017 Financial Services and General Government Appropriations, which included a provision that would have allowed banks to work with marijuana dispensaries.
Those who backed the bill said they were “frustrated” and called the decision “terrible.” The measure has had bipartisan support and was three years in the making. Suddenly, it was slapped with the label of “poisonous pill.”
Supporters of both measures noted a recent shooting at a dispensary in Aurora, CO, as reported by The Denver Post. Officers in the city responded to a report of a robbery with shots fired. The security guard inside the marijuana dispensary suffered several gunshot wounds. He was tragically later pronounced dead at the hospital. Police are on the lookout for two armed suspects.
Although authorities have not said whether cash or marijuana was the target of the robbery, it’s well-known that marijuana operations are forced to operate with cash-only, and therefore large amounts of it are known to be in the building at any one time. Dispensaries would be exponentially safer, it’s been argued, if they could:
- Accept debit/ credit card payments;
- Store their funds in a business bank account;
- Make transfers and pay bills online or via wire service, as opposed to hand-delivering cash.
Senators and Representatives who are stalling on this front are delaying the inevitable, and they are putting public safety at risk to do so.
Marijuana advocates will no doubt continue to press for change on this front. In the meantime, marijuana dispensaries should consult with an experienced L.A. marijuana attorney to learn more about their rights and legal options and responsibilities when handling large sums of cash.
The Los Angeles CANNABIS LAW Group represents growers, dispensaries, collectives, patients and those facing marijuana charges. Call us at 949-375-4734.
Effort to open banking system to marijuana businesses stalls, June 22, 2016, By Kristena Hansen, The Associated Press
More Blog Entries:
Colorado’s Teen Marijuana Use Lower After Legalization, June 23, 2016, L.A. Marijuana Lawyer Blog