** FILE **
President Obama speaks at a campaign rally in Las Vegas, Oct. 24, 2012. (Associated Press)
DENVER — Bankers should beware of the
Obama administration’s newly issued green light for banks doing business with the legal marijuana industry, according to the head of the
Colorado Bankers Association.
Memos released Friday by the
Justice Department and
Treasury Department’s
Financial Crimes Enforcement Network were intended to give banks leeway
to open accounts for marijuana businesses in states like Colorado and
Washington that have legalized retail pot. Instead, the guidance “only
reinforces and reiterates that banks can be prosecuted for providing
accounts to marijuana related businesses,” said the
CBA in a Friday statement.
“In fact, it is even stronger than original guidance issued by the
Department of Justice and the Treasury,” said
CBA president and CEO
Don Childears.
“After a series of red lights, we expected this guidance to be a yellow
one. This isn’t close to that. At best, this amounts to ‘serve these
customers at your own risk’ and it emphasizes all of the risks. This
light is red.”
Colorado’s first-ever legal marijuana market, which
kicked off Jan. 1, has been hampered by a lack of access to bank
accounts and small-business loans. Many of the state’s retail pot shops
are cash-only enterprises, making them vulnerable to crime.
Washington
is expected to start sales of retail pot in June. Voters in Colorado
and Washington approved in 2012 ballot measures legalizing limited
amounts of recreational marijuana for adults 21 and over.
“Now
that some states have elected to legalize and regulate the marijuana
trade, FinCEN seeks to move from the shadows the historically covert
financial operations of marijuana businesses,” said FinCEN Director
Jennifer Shasky Calvery in a statement.
“Our
guidance provides financial institutions with clarity on what they must
do if they are going to provide financial services to marijuana
businesses and what reporting will assist law enforcement,” she said.
But
the FinCen memo makes it clear that banks must avoid doing business
with illegal marijuana operators or those that violate the eight
priorities laid out in the
Justice Department’s so-called Cole Memo, issued in August by Deputy Attorney General James Cole.
Read More Here
.....
The Feds' Scary Reassurances To Banks That Deal With State-Licensed Marijuana Businesses
On Friday the Treasury Department and the Justice Department
issued guidelines for banks that do business with state-licensed marijuana suppliers. According to Attorney General Eric Holder, the
aim of
the memos is to reassure financial institutions that are leery of
accepting cannabusinesses as customers because they worry it will
attract unwanted attention from federal regulators and prosecutors. But
as with the
August 29 memo in
which Deputy Attorey General James Cole said that prosecuting properly
regulated marijuana growers and sellers would not be a high priority,
there are
no guarantees, and that fact is likely to
deter traditionally cautious banks more than plucky cannabis entrepreneurs.
The
Treasury memo,
issued by the department’s Financial Crimes Enforcement Network
(FinCEN), says the Bank Secrecy Act (BSA) requires financial
institutions to file “suspicious activity reports” (SARs) for all
marijuana businesses. But FinCEN draws a distinction between marijuana
businesses that violate state law or implicate one of the Justice
Department’s “enforcement priorities” and marijuana businesses that do
neither. The former merit “marijuana priority” reports, while the latter
fall into a newly invented “marijuana limited” category. According to
the memo, this distinction “aligns the information provided by financial
institutions in BSA reports with federal and state law enforcement
priorities.”
What are those priorities? Cole’s August 29 memo lists eight: 1)
“preventing the distribution of marijuana to minors,” 2) “preventing the
diversion of marijuana from states where it is legal under state law in
some form to other states,” 3) “preventing drugged driving and the
exacerbation of other adverse public health consequences associated with
marijuana use,” 4) “preventing the growing of marijuana on public
lands,” 5) “preventing marijuana possession or use on federal property,”
6) “preventing revenue from the sale of marijuana from going to
criminal enterprises,” 7) “preventing violence and the use of firearms
in the cultivation and distribution of marijuana,” and 8) “preventing
state-authorized marijuana activity from being used as a cover or
pretext for the trafficking of other illegal drugs.” At the end of the
memo, Cole adds that the feds might also intervene for other,
unspecified reasons.
The FinCEN memo lists “red flags” that suggest a marijuana business
deserves special scrutiny, including “international or interstate
activity,” an inability to “demonstrate the legitimate source of
significant outside investments,” signs that the business is “using a
state-licensed marijuana-related business as a front or pretext to
launder money derived from other criminal activity,” and “negative
information, such as a criminal record, involvement in the illegal
purchase or sale of drugs, violence, or other potential connections to
illicit activity.” Such red flags are supposed to inform banks’
decisions about which customers to reject or drop as well as which sort
of SAR to file. FinCEN warns that the red flags it mentions “do not
constitute an exhaustive list.” Although FinCEN says its advice “should
enhance the availability of financial services for, and the financial
transparency of, marijuana-related businesses,” it never actually says
banks that follow the guidelines need not worry about getting into
trouble with regulators.
Read More Here
.....
South Carolina passes bill to nullify federal hemp ban
South Carolina Passes Bill To Nullify Federal Hemp Ban | Ben Swann Truth In Media
