The attorneys general of 17 states, the District of Columbia and Guam joined forces on Tuesday to press the federal government to allow legal marijuana businesses to access the banking system.
“We are a bipartisan group of state attorneys general who recognize that the states and federal government share a strong interest in protecting public safety and bringing grey market activities into the regulated banking sector,” they wrote in a letter to congressional leaders. “To address these goals, we urge Congress to advance legislation that would allow states that have legalized medical or recreational use of marijuana to bring that commerce into the banking system.”
Due to overarching federal prohibition and criminalization, many banks are wary of working with state-legal cannabis businesses. As a result, many marijuana growers, processors and sellers operate on a cash-only basis, which can make them targets for robberies.
“Banks and other depository institutions are currently hindered by federal law from providing financial services to cannabis businesses,” Hawaii Attorney General Doug Chin said in a press release. “This encourages a cash-only, grey market that hurts law enforcement and tax collections.”
— Hawaii AG Doug Chin (@AtghIgov) January 16, 2018
“To address these challenges, we are requesting legislation that would provide a safe harbor for depository institutions that provide a financial product or service to a covered business in a state that has implemented laws and regulations that ensure accountability in the marijuana industry such as the SAFE Banking Act (S. 1152 and H.R. 2215) or similar legislation,” the state attorneys general wrote in the letter to federal lawmakers. “This would bring billions of dollars into the banking sector, and give law enforcement the ability to monitor these transactions. Moreover, compliance with tax requirements would be simpler and easier to enforce with a better-defined tracking of funds. This would, in turn, result in higher tax revenue.”
The future of small and local licensed businesses has been threatened by the Trump Administration's relentless attacks on progress, in conflict with the will of voters 2/2 https://t.co/Oir3EAT04m
— Xavier Becerra (@AGBecerra) January 16, 2018
“California voters have made it clear: when it comes to the cannabis industry, California is moving forward, not backwards,” California Attorney General Xavier Becerra said in a press release. “This is an issue that is impacting both red and blue states. The future of small and local licensed businesses has been clouded by the Trump Administration’s relentless attacks on progress, in conflict with the will of voters. Congress has the power to protect a growing $6.7 billion industry and the public safety of our communities. My team at the Department of Justice is committed to implementing and enforcing the law in California in a way that most effectively protects the health and safety of our people.”
Alaska Attorney General Jahna Lindemuth said, “Allowing banks to work with these businesses is good policy, which is why the concept has bipartisan support. Most importantly, bringing the cash from state-licensed marijuana businesses into the banking system will alleviate the public safety issues that come with having to rely on cash, instead of depositing money in a bank. It will also help state regulators better oversee the new industry and go after bad actors.”
Read the full text of the marijuana banking letter from attorneys general below: