Tim Blakeley, manager of Sunset Junction medical marijuana dispensary, fills a marijuana prescription on May 11, 2010 in Los Angeles, CA.(Photo by Kevork Djansezian/Getty Images)
(USA Today) WASHINGTON - The Obama administration Friday provided new guidelines to the banking industry aimed at making it easier for state-legalized marijuana businesses to have greater access to financial institutions.
In separate advisories issued by the Treasury and Justice departments, the administration's action follows concerns expressed last month by Attorney General Eric Holder that legal marijuana operations were dealing largely in cash because banks feared that any relationship with the dealers put them at risk of prosecution under existing federal drug and money laundering statutes.
Twenty states and Washington, D.C., have legalized marijuana for medical use. Two of those states - Colorado and Washington - also have legalized marijuana for recreational use.
The guidance, similar to a Justice directive issued in August to address state laws that allow for medical and recreational marijuana use, advises banks that they likely could avoid federal law enforcement scrutiny if they submitted to eight specific conditions, including avoiding dealers that distributed marijuana to minors and those that directed revenue from marijuana sales to gangs and cartels.
"The (Justice) department shares the concerns of public officials and law enforcement about the public safety risks associated with businesses that handle significant amounts of cash,'' said Allison Price, Justice spokeswoman. "These guidelines, together with the Treasury Department's guidance to financial institutions, are intended to increase the availability of financial services for marijuana businesses - that are licensed and regulated - while at the same time preserving and enhancing important law enforcement tools.''
While the Treasury advisory was directed to the banking industry, the separate Justice advisory was issued to federal prosecutors across the nation.
"This... guidance should enhance the availability of financial services for, and the financial transparency of, marijuana-related businesses,'' Treasury's Financial Crimes Enforcement Network said in a written statement.
The Treasury advisory urged banks to conduct their own reviews to verify the legitimacy of the businesses that are required to be "duly licensed and registered'' in their respective states.
Treasury also is requiring the banks to regularly file reports that outline their dealings with legitimate marijuana businesses and flag any contacts with suspicious dealers.
In a memo issued on its website, the American Bankers Association said that because marijuana remains illegal under federal statute, "guidance alone isn't enough.''
"There's a great deal of guidance that banks would want to see in terms of banking with these types of businesses but guidance alone doesn't change the fundamental prohibition,'' the memo states. "In order for banks to be comfortable banking marijuana businesses, the federal statute must be changed by Congress.''
Advocates for marijuana decriminalization, however, said the government's action marked another breakthrough.
"This is a huge victory for our members, our communities and the banks that take this opportunity to serve a thriving new market,'' National Cannabis Industry Association Executive Director Aaron Smith said. "The legal, regulated cannabis industry is legitimate, professional and prospering and our businesses deserve to be treated like those in any other American industry.''
In a speech last month at the University of Virginia, Holder said the guidelines were "an attempt to deal with reality that exists in these states.''
"There's a public safety component to this,'' he said. "Huge amounts of cash, substantial amounts of cash, just kind of lying around with no place for it to be appropriately deposited is something that would worry me just from a law enforcement perspective.''
You may also like...
Fight for a Bill in Florida:
-Medical pot has enough signatures for ballot
-FL Supreme Court oks medical marijuana initiative for Nov. ballot
-Medical marijuana bill filed in Florida
-Is marijuana more dangerous than alcohol?
-Sanjay Gupta: I was wrong about weed
-Medical marijuana initiative could help Dems in governor's race
-Gov. Scott will vote against medical marijuana
-Medical marijuana gets traction in the Deep South
-Did he inhale? Rubio won't say whether he ever smoked marijuana
-Debate hits Sarasota: Sheriff vs. John Morgan
The Business Side:
-Cannabis College opens in Tampa
-New guidelines help banks deal with marijuana business
-Marijuana stocks light up the market
-Recreational pot sales: Where the grass is much greener