More Banks Open Doors to Marijuana Dispensaries

For marijuana businesses, banking and investing can be complicated given federal prohibitions against marijuana sales. While a growing number of states are approving marijuana for medical use or recreational use, those involved in the marijuana business face a legal predicament with regards to banking.

Local and national financial institutions do not the risk of taking “drug money.” Many businesses have been forced to operate on a cash-only basis, leaving them vulnerable to theft and other crimes. Despite previous challenges, recent reports indicate that the banking industry and federal regulatory agencies may be opening doors to dispensaries.


Since Colorado legalized recreational pot at the start of 2014, more than 100 banks and credit unions nationwide have begun banking with marijuana dispensaries and other companies. While this is only 1% of the total banks in the country, it indicates marijuana business owners are getting more opportunities in the financial sector. Our Orange County marijuana dispensary attorneys are dedicated to protecting the rights of clients throughout Southern California. We are abreast of changes in marijuana law, compliance issues, as well as complex legal questions for pot business owners and operators. In addition to helping ensure compliance, we are also able to provide strategic representation in the event of a criminal investigation.

The number of banks working with marijuana businesses is up 20% since 2012. Federal regulators have also tried to reassure banks that they could provide services to marijuana customers if they meet certain procedural requirements. In February this year, the Treasury Department approved the opening of bank accounts for marijuana businesses, providing guidance which affirmed the federal position that marijuana is illegal but that banks can legally provide services to pot entrepreneurs. Banks are required to report any suspicious activities and document all transactions involving marijuana businesses. Federal guidelines for banks also require institutions to identify suspicious activity, including the use of an account to launder money for the sale of other illicit drugs.

A previous guidance memo stated that the Justice Department will only pursue criminal charges against marijuana businesses that violate one of the eight conditions. The “Cole Memo” prohibits businesses from some specific actions, including selling marijuana to minors. Marijuana business advocates in Colorado, as well as local banking institutions, have voiced concern that even with federal guidelines, many banks will still be reluctant to open accounts. Though many banks are waiting for a Congressional seal of approval, the guidance is a step in the right direction for businesses and financial institutions.

Despite the progress that businesses have made with some banks, it is unlikely that businesses will have equal access to financial institutions until Congress acts. Currently, a bill is under review that would approve banking for pot businesses that are operating legally under state law. The same bill would prohibit banking for marijuana businesses in states where pot is not yet legal.

The Los Angeles CANNABIS LAW Group represents growers, dispensaries, collectives, patients and those facing marijuana charges. Call us at 949-375-4734.

More Blog Entries:
Getting Started in the Medical Marijuana Industry, May 15, 2014, Los Angeles Marijuana Lawyer Blog
App Technology Highlights Future of Marijuana Business, July 9, 2014, Los Angeles Marijuana Lawyer Blog

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