Bipartisan Group of Senators Presses Federal Regulator for Clear Guidance on Banking Services for Vendors Working with Legal Marijuana Businesses
Landlords, chemists, security companies and more have had their bank accounts frozen for doing business with legal marijuana businesses
WASHINGTON, D.C. – Today, a bipartisan group of Senators led by Oregon’s Senator Jeff Merkley pressed a key federal regulator to take further action to ensure that vendors working with legal marijuana businesses in states that have legalized recreational or medicinal marijuana do not have their banking services taken away.
In states that have legalized recreational or medicinal marijuana, conflicting federal policies have led most financial institutions to deny banking services to legal marijuana businesses, creating huge logistical and safety problems for communities across the country. In some cases, banks have even revoked services to businesses—for example, landlords and security companies—that contract to offer their services to legal marijuana businesses. With eight states having voted to allow or expand some form of legal marijuana usage this November, the problem is only set to grow.
In a letter to the head of the Financial Crimes Enforcement Network (FinCEN), U.S. Senators Merkley, Ron Wyden (D-OR), Kirsten Gillibrand (D-NY), Patty Murray (D-WA), Elizabeth Warren (D-MA), Bernie Sanders (I-VT), Al Franken (D-MN), Angus King (I-ME), Lisa Murkowski (R-AK) and Cory Booker (D-NJ) wrote:
“Most banks and credit unions have either closed accounts or simply refused to offer services to indirect and ancillary businesses that service the marijuana industry. A large number of professionals have been unable to access the financial system because they are doing business with marijuana growers and dispensaries. This long list of professionals includes chemists who have had their checking accounts closed due to their role in testing marijuana for the presence of harmful materials like arsenic; the security industry, which marijuana businesses heavily rely on due to the massive amounts of cash they handle; and lawyers offering legal services to marijuana businesses, who have reported banks denying applications for bank accounts and credit cards.
“To be clear, these legitimate, indirect businesses have been unable to open checking accounts and accept credit cards or checks. In some cases they have also lost access to existing accounts, such as retirement accounts, and have been forced to pay their employees, taxes, and bills in cash. Locking lawyers, landlords, plumbers, electricians, security companies, and the like out of the nation’s banking and finance systems serves no one’s interest.
“Forcing all these direct and indirect businesses to operate in cash not only creates a huge target for criminals, but also complicates the collection of state and federal taxes. … This business environment is an invitation to tax fraud, robberies, money laundering, and organized crime.”
The Senators pressed FinCEN to issue updated guidance on this issue without delay. The full text of the letter follows below.
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