The Justice and Treasury departments on Friday outlined the new policy to federal prosecutors and financial institutions nationwide. The guidance stopped short of promising immunity for banks and credit unions that would do business with the marijuana industry, but the guidance did clarify the government position.
Criminal prosecution for money laundering and other crimes is unlikely if the financial institutions meet a series of conditions.
Those conditions include significant due diligence on the part of banks and credit unions aimed at potential customers who are in the marijuana trade. In order to ensure compliance with the guidelines, among other requirements the banks and credit unions must verify licenses, review license applications and other documentation, monitor publicly available sources for adverse information about the businesses and continually monitor accounts for suspicious activities.
"I'm thankful for all the work they've done," he said. "I know this has been challenging. I'm guardedly optimistic that there will be some of my state charters who will read this through, and be comfortable making a decision to bank
Initiative 502, passed by
Because no licenses have yet been issued in
He noted that the latest guidance does not apply to the medical marijuana industry in
"The guidance adds a little more comfort, but it's not a green light," he said. "We believe it's not definitive enough for us to proceed. Until we get something more definitive, at that point we'll decide. It hasn't crossed the goal line yet. We're going to suggest people proceed very cautiously."
"We are reviewing this important guidance. It does provide an important first step in the ability of banks to consider whether to offer these services to this emerging industry. It will set forth a fairly complicated process that banks will have to go through. Each financial institution will have to decide on their own whether to set up those systems and set up the due diligence."
The guidance, he said, "does provide a pathway. What we don't know is whether financial institutions will go down the pathway."
Credit unions as well as banks have been deciding whether to provide services to the industry.
"We encourage our credit union management and legal staff to carefully review the guidance and compliance requirements before determining whether to proceed," she said in a statement. "It is important to note that the policy issued today is guidance and not law. Congressional action is still needed, to mitigate risks long term. We expect further guidance from the
"It is currently
According to the guidance issued by the
The guidance goes on to say, "Because federal law prohibits the distribution and sale of marijuana, financial transactions involving marijuana-related business would generally involve funds derived from illegal activity."
The guidance should persuade banks to at least accept the companies' deposits, she said.
"I think it's going to be enough for these banks who have been chomping at the bit to get a piece of this action," Bricken said.
Bricken also predicted marijuana businesses would now have an easier time accepting credit cards and debit cards. But she isn't so sure it would persuade banks to make loans to the businesses.
The guidance could also remove an obstacle to finding investors, Bricken said. Some have been leery because of questions of how they would keep track of the money they invest in the industry.
He said the bank hasn't yet agreed to take his business, but he's confident he'll be able to secure a bank account somewhere.
The alternative would involve, among other things, handing tax collectors millions of dollars in cash. "We want to be able to write a check to pay taxes," he said.
"I'm curious how this plays," she said. "We're used to jumping through hoops. I will jump through all the hoops they want me to jump through. I'm hopeful that this is enough to let the banks move forward. That's what I'm hoping. Everybody is so scared and worried. I'm hopeful and I'm thrilled that they are finally addressing it. It's a wonderful move."
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