The General
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Marijuana entrepreneurs in states that have legalized the drug for either medical or recreational purposes have had trouble finding banking partners. Because marijuana remains an illegal substance under federal law, few financial firms have been willing to provide checking accounts and other services to those growing, processing and selling the drug.
Previously it was difficult to know the exact scope of this problem. But earlier this week a federal official involved in policing financial crimes offered some details: just 105 institutions in more than one-third of states are "engaged in banking relationships with marijuana related businesses," Jennifer Shasky Calvery, the director of the Financial Crimes Enforcement Network, said in a speech. (In addition to Colorado's and Washington's policies allowing recreational use, 35 states have legalized some form of marijuana consumption for medical purposes.) Ms. Calvery also said that financial firms had made 475 filings alerting regulators to the fact that they had terminated relationships with marijuana businesses as of Aug. 8 "in order to maintain an effective anti-money laundering compliance program."
Earlier this year, Ms. Calvery's agency issued a guidance that was ostensibly meant to encourage financial firms to do business with marijuana entrepreneurs operating in compliance with state law. And in her speech, Ms. Calvery said the statistics she offered suggest that the guidance "is having the intended effect." Actually the data suggests that cannabis businesses will continue to struggle to find financial partners as long as marijuana remains on Schedule I of the Controlled Substances Act–a classification that the editorial board opposes.
Regardless of what one thinks about legalizing marijuana for medical and recreational use, there is good reason to encourage more banks to work with cannabis entrepreneurs in states where the drug is legal. Businesses that operate entirely in cash are often targets of armed robberies. They are also difficult to audit since it is easier for them to engage in tax evasion, wage theft and money laundering.
News Moderator - The General @ 420 MAGAZINE ®
Source: Takingnote.blogs.nytimes.com
Author: Vikas Bajaj
Contact: Contact Us
Website: Checking-accounts-for-marijuana-businesses
Previously it was difficult to know the exact scope of this problem. But earlier this week a federal official involved in policing financial crimes offered some details: just 105 institutions in more than one-third of states are "engaged in banking relationships with marijuana related businesses," Jennifer Shasky Calvery, the director of the Financial Crimes Enforcement Network, said in a speech. (In addition to Colorado's and Washington's policies allowing recreational use, 35 states have legalized some form of marijuana consumption for medical purposes.) Ms. Calvery also said that financial firms had made 475 filings alerting regulators to the fact that they had terminated relationships with marijuana businesses as of Aug. 8 "in order to maintain an effective anti-money laundering compliance program."
Earlier this year, Ms. Calvery's agency issued a guidance that was ostensibly meant to encourage financial firms to do business with marijuana entrepreneurs operating in compliance with state law. And in her speech, Ms. Calvery said the statistics she offered suggest that the guidance "is having the intended effect." Actually the data suggests that cannabis businesses will continue to struggle to find financial partners as long as marijuana remains on Schedule I of the Controlled Substances Act–a classification that the editorial board opposes.
Regardless of what one thinks about legalizing marijuana for medical and recreational use, there is good reason to encourage more banks to work with cannabis entrepreneurs in states where the drug is legal. Businesses that operate entirely in cash are often targets of armed robberies. They are also difficult to audit since it is easier for them to engage in tax evasion, wage theft and money laundering.
News Moderator - The General @ 420 MAGAZINE ®
Source: Takingnote.blogs.nytimes.com
Author: Vikas Bajaj
Contact: Contact Us
Website: Checking-accounts-for-marijuana-businesses
