Bank officials have urged Congress to fully open the doors of the U.S. banking system into the legal cannabis sector. Most Americans live in area where marijuana is legally available in some sort, either through medicinal or recreational means.
But there’s a problem.
Bigger banks generally don’t want anything to do with money coming from the cannabis industry for fear it may expose them to legal trouble from the federal government, which is still federally illegal.
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California Treasurer Fiona Ma said the new proposition from congress,”would provide the needed permission” for more financial institutions to welcome the cannabis industry.
The Republicans aren’t totally on board, predictably.
Republican Rep. Blaine Luetkemeyer of Missouri said the proposition would create confusion while marijuana remains illegal at the federal level. He questioned the way banks could identify offender operators and pointed to how Congress handled hemp, the low-THC cousin of the cannabis plant, that was removed from the list of controlled substances.
With the banking laws,”we are putting the cart before the horse,” he explained.
Legalization advocates have reason to observe the hearing took place before the Consumer Protection and Financial Institutions Subcommittee. The proposal, or similar versions, have languished for years.
They are just looking at if banking solutions should be available to these businesses in states where it’s already legal,” said Mason Tvert of the Marijuana Policy Project, an advocacy group.
The amount of banks and credit unions willing to manage cannabis money is increasing, but they still represent just a very small fraction of the business.
The hearing came just days after Oregon Sen. Ron Wyden proposed legislation which would provide states a free hand to allow lawful cannabis markets with no threat of national criminal intervention. The proposition would take bud off the federal controlled substances list and remove federal criminal penalties for people and companies acting in compliance with state marijuana legislation. The same proposal is pending from the House.