Murray, Cantwell say legal marijuana relies on banking
Two weeks ago, U.S. Attorney General Jeff Sessions rescinded Obama-era marijuana rules. These rules included the Cole memo, which states the federal government will not interfere with state-approved marijuana laws. Sessions has still not clarified if he will issue new rules or simply revert to old policy.
In light of the uncertain future of the marijuana industry, Washington Sens. Patty Murray and Maria Cantwell sent a bipartisan letter to the Department of Treasury urging its Financial Crimes Enforcement Network to keep intact 2014 rules that allow cannabis industry banking. The rules are outlined in the Bank Secrecy Act.
“This guidance was developed and issued in conjunction with the Department of Justice and has provided much needed stability to a growing market,” the letter reads. “We urge FinCEN to preserve this guidance to continue to support banking infrastructure and access to financial institutions for businesses that are operating in accordance with state and local law and abiding by eight other stated factors in your guidance.”
In Washington, 12 financial institutions conduct business with cannabis retailers. The ability to utilize banking services is vital to marijuana businesses as the Washington State Liquor and Cannabis Board doesn’t accept tax payments in cash. Gov. Jay Inslee said earlier this month the state’s cannabis industry, which is projected to bring in $730 million in revenue in the next two years, is the foundation of Washington’s success.
“This guidance must remain intact because the risks involved in removing it are too great,” the letter reads.
Jim Mullen, co-owner of The Herbery and president of the Washington Cannabis Business Association, said if these rules are rolled back it would be detrimental to the cannabis industry.
“I believe it would be extremely disruptive and I believe it would be a serious public safety issue,” Mullen said. “I can see both sides of the equation but our hope is that we’re allowed at the very least to continue with the banking that we do have.”
The issues associated with a lack of banking vary from depositing cash safely to being able to pay utility bills and employees.
“We’re looking to work as any other mainstream business does,” he added.
As it is, Mullen said, many cannabis businesses continue to struggle to find a bank. Mullen and his business partner were able to establish themselves as clients with Salal Credit Union in Seattle before opening The Herbery, but others aren’t as lucky.
“Wells Fargo, Bank of America, Chase, they’ve all closed accounts of people in the industry because those people are moving cannabis money through their accounts,” he said.
Even though Mullen said he’s nervous about what might happen, he knows there’s a lot of support coming from legislators nationwide.
“I know it’s not everybody out to get us,” he said. “I think what Sessions did actually was to get people off the fence. A lot of people, specifically Republicans, are coming out now and saying they’re in support of who we are and what we do as long as we’re following specific criteria.”
Being in line with the law and operating a safe, regulated industry is what cannabis retailers want to do, Mullen added.