It’s well known that many banks are reluctant to open accounts for marijuana businesses out of fear of running afoul of the U.S’s government’s continued criminalization of the drug.
But one major institution just took the financial services industry’s cannabis cash paranoia a step further, saying—in what appears to be a first—that it won’t do business with a political candidate because she has received donations from cannabis industry interests.
Wells Fargo, the fourth-largest bank in the U.S., fired Florida agriculture commissioner candidate Nikki Fried as a client this month because her campaign has received donations from “lobbyists from the medical marijuana industry,” according to copies of emails her campaign made public on Monday.
“As part of the onboarding of the client it was uncovered some information regarding the customers [sic] political platform and that they are advocating for expanding patient access to medical marijuana,” Antoinette Infante, a vice president and senior relationship manager at Wells Fargo, wrote in a July 11 email to the Fried campaign’s compliance officer.
After the campaign confirmed in a reply that Fried has indeed received contributions from cannabis industry leaders—and had no intention of stopping—Wells Fargo confirmed the closure of the account in an August 3 letter.
“Periodically, we review our account relationships as part of our responsibility to oversee and manage banking risks,” the letter said. “As a result of a recent review of your account relationship, we determined that we need to discontinue our business relationship and close the account above within 30 days from the date of this letter.”
If the move represents a new companywide policy—whether or not it spreads to other banking institutions—it could have implications for dozens of members of Congress and other politicians who regularly accept campaign contributions from people involved in the marijuana industry.
It could also affect the bank accounts for campaign committees and nonprofit groups working to advocate for marijuana policy change through legislatures and via ballot measures.
“This is yet another clear signal to Congress that they need to address the banking issue for the cannabis industry,” Mason Tvert, a spokesman for the Marijuana Policy Project (MPP), said in a statement. “It is absurd enough that state-regulated businesses are being denied standard banking services, but it is absolutely ludicrous that political candidates and nonprofit advocacy organizations are also being affected. There is no rational reason for Congress to go another session without fixing this growing problem, which has serious societal implications.”
MPP itself had its account closed by PNC Bank last year.
Fried, a Democrat, held a press conference at the Florida capitol on Monday morning to “address this arbitrary, unprecedented action against the fundamental rights to speech of a candidate for public office, and call attention to the out of touch institutions, laws and politicians that allowed this transgression to occur in the first place,” according to a news advisory.
In an email on Monday afternoon, Michael H. Gray, a Wells Fargo assistant vice president for corporate communications defended the company’s move.
“It is Wells Fargo’s policy not to knowingly bank or provide services to marijuana businesses or for activities related to those businesses, based on federal laws under which the sale and use of marijuana is illegal even if state laws differ,” he said. “We continually review our banking relationships to ensure we adhere to strict regulatory and risk guidelines.”
When asked if that meant the company would be canceling the accounts of members of Congress who bank with Wells Fargo, Gray responded, “The policy applies to everyone.”
Because of ongoing federal marijuana prohibition, many banks have remained wary about working with marijuana businesses, even as a growing number of states move to legalize the drug for recreational or medical purposes.
But Wells Fargo’s move appears to be the first time a financial institution has denied banking services to a candidate for public office as a result of donations from the cannabis industry.
Florida voters overwhelmingly approved a medical cannabis ballot measure in November 2016, but its implementation has been slow and contentious as advocates and state officials battle over issues such as a ban on smoking the drug.
While Fried would not have significant oversight of medical marijuana issues if elected as commissioner of agriculture and consumer services, she has regularly mentioned the issue during the course of her campaign.
“There is no clearer example of our broken government than medical marijuana,” she said in video announcing her candidacy.
Fried herself was a medical cannabis lobbyist prior to running for office.
Despite the fears that many banks have about working with the marijuana industry, recent federal data shows that a growing number of financial institutions are actively opening and maintaining accounts for cannabis businesses.