This afternoon, the Obama Administration announced new guidelines that will allow banks to legally provide financial services to state-licensed marijuana businesses. Twenty states and Washington D.C. have legalized marijuana for medical use; two of those states (Colorado and Washington) recently legalized marijuana like alcohol.
Many banks have been afraid to open checking or savings accounts for legalized marijuana businesses out of fear of breaking federal law. As a result these businesses are forced to deal with large amounts of cash, creating public safety risks for employees, bystanders, and police officers.
In a joint statement, the U.S. Department of Justice and the Financial Crimes Enforcement Network, a bureau of the U.S. Department of the Treasury, said the move gives “greater financial transparency” to an industry that remains illegal in nearly every state. It also makes clear that banks would be helping law enforcement with “information that is particularly valuable” in filing regular reports that offer insights about how marijuana businesses work.
Holder’s announcement closely follows guidance issued in August by the Justice Department that indicated the Obama administration will not undermine state marijuana legalization provided states are responsibly regulating marijuana businesses. In a recent interview with The New Yorker, President Obama said marijuana is less harmful to people who use it than alcohol, the war on marijuana is creating unjust racial disparities, and it is important for legalization to move forward in Colorado and Washington “because it’s important for society not to have a situation in which a large portion of people have at one time or another broken the law and only a select few get punished.”
Statement from Ethan Nadelmann, executive director of the Drug Policy Alliance:
“It appears that the Obama Administration is trying to provide as much protection as possible for the marijuana industry, given the constraints of federal law,” said Ethan Nadelmann, executive director of the Drug Policy Alliance. “The assurances the administration have provided appear fairly substantial and will hopefully prove sufficient so that banks will feel safe doing business with the marijuana industry. I have to say I’m impressed by how the White House is trying to make this work, especially given the inability of Congress to do anything constructive in this area.”