Share

California considers plan to encourage marijuana banking

Share

LOS ANGELES (AP) — California legislators considered a plan Monday intended to encourage more banks to do business with marijuana companies that have been frozen out of thousands of financial institutions.

Most Americans live in states where marijuana is legally available in some form. But most financial institutions don’t want anything to do with money from the cannabis industry for fear it could expose them to legal trouble since the federal government still considers marijuana illegal.

The conflict between state and federal law has left businesses in California’s emerging legal pot industry in a legal dilemma, shutting many out of everyday services such as opening a bank account or obtaining a credit card. It also has forced many businesses to operate only in cash — sometimes vast amounts — making them ripe targets for crime.

An Assembly bill would authorize state regulators to share detailed sales, cultivation and shipping information collected from cannabis companies with banks, a step supporters hope will provide additional assurances to financial institutions that a pot shop or grower is operating within the law.

During the Obama administration, the Justice Department issued guidelines to help banks avoid federal prosecution when dealing with pot businesses in states where the drug is legal.

But most banks don’t see those rules as a shield against charges that could include aiding drug trafficking. And they say the rules are difficult to follow, in effect placing the burden on banks to determine if a pot business is complying with all legal rules.

Cara Martinson of the California State Association of Counties told members of an Assembly committee that the bill represented an incremental step until a solution is reached at the federal level.

“This could help move the ball,” she said.

The number of banks and credit unions willing to handle pot money is growing — it’s over 400 nationally — but they still represent only a small fraction of the industry.

The Western Journal has not reviewed this Associated Press story prior to publication. Therefore, it may contain editorial bias or may in some other way not meet our normal editorial standards. It is provided to our readers as a service from The Western Journal.

Truth and Accuracy

Submit a Correction →



We are committed to truth and accuracy in all of our journalism. Read our editorial standards.

Tags:
Share
The Associated Press is an independent, not-for-profit news cooperative headquartered in New York City. Their teams in over 100 countries tell the world’s stories, from breaking news to investigative reporting. They provide content and services to help engage audiences worldwide, working with companies of all types, from broadcasters to brands. Photo credit: @AP on Twitter
The Associated Press was the first private sector organization in the U.S. to operate on a national scale. Over the past 170 years, they have been first to inform the world of many of history's most important moments, from the assassination of Abraham Lincoln and the bombing of Pearl Harbor to the fall of the Shah of Iran and the death of Pope John Paul.

Today, they operate in 263 locations in more than 100 countries relaying breaking news, covering war and conflict and producing enterprise reports that tell the world's stories.
Location
New York City




Advertise with The Western Journal and reach millions of highly engaged readers, while supporting our work. Advertise Today.

Conversation