One of the many ways the federal authorities have worked to erode the rights of medical marijuana dispensaries and patients is to ensure that these facilities can’t access banks in the same capacity as other businesses.
Currently, our Los Angeles marijuana lawyers know that federal prosecutors have threatened to impose or have actually imposed harsh punishments and penalties on banks that have historically done business with marijuana operations, regardless of whether those operations were legitimate, licensed and regulated.
This has effectively turned medical marijuana (and recreational marijuana, in states where that is now legal) into a cash crop, where patients must pay upfront in cash and dispensaries are unable to safely keep and track money in checking or savings accounts.
U.S. lawmakers are hoping that changes. U.S. House Bill 2652 was introduced earlier this month, sponsored by congressmen from Colorado and Washington state, along with 16 bipartisan co-sponsors, aims to reform federal banking laws to allow marijuana providers access.
The Marijuana Business Access to Banking Act of 2013 would permit marijuana facilities, both medical and recreational, that are regulated and authorized by the state to legally access financial institutions.
The measure would serve to update federal banking laws that currently pose conflicts with state laws – specifically those legitimizing marijuana dispensing operations. This, backers say, would serve to promote financial security for these owners, as well as safety within the community.
Officials often site robberies as part of the reason why they don’t want dispensaries in their neighborhoods. But the reality is that these operations are being forced to keep large quantities of cash on hand, which is inevitably going to be a draw for would-be robbers.
As it now stands, even some of the most basic banking services – merchant credit card processing, checking accounts and the ability to write checks to pay taxes or meet payroll – are largely unavailable to these entities.
This, in turn, sometimes puts them on the wrong side of the Internal Revenue Service. This gives federal prosecutors even more ammunition against these entities, even though there was never an intention to avoid paying taxes in the first place.
As one supportive representative was quoted as saying, its nearly unfathomable that any small business owner would be able to run a legitimate operation without access to the banking system. We have 18 states plus Washington D.C. allowing adult usage of marijuana in some capacity or another, and federal law should be updated to reflect that reality, he said.
Lawmakers say not only are lost tax revenue and public safety a concern, but banks should be allowed to make their own business decisions regarding their involvement with legal operations, without fear of federal regulatory penalties or even criminal charges.
The bill, if passed, would prohibit federal banking regulators from:
- Threatening or limiting depository institutions’ access to the Deposit Insurance Fund;
- Prohibiting, discouraging or penalizing depository institutions;
- Take any action against a loan made to a business that is covered;
- Strong-arm a depository institution into denying banking services to legitimate firms.
The legislation would cover any marijuana-related legitimate business, which would include manufacturers, growers, producers and any operation that legally handles, sells, transports, displays or distributes the drug or related products.
The Los Angeles CANNABIS LAW Group represents growers, dispensaries, collectives, patients and those facing marijuana charges. Call us at 949-375-4734.
WA, CO Congressmen Introduce Federal Bill to Allow Banking for Marijuana Industry, July 11, 2013, By Thomas H. Clarke, The Daily Chronic
More Blog Entries:
Congressional Leaders Move to Protect Marijuana Industries in Home States, July 1, 2013, Los Angeles Marijuana Lawyer Blog