Departments of Justice and Treasury Release Marijuana Banking Guidance

  • by Erik Altieri, NORML Executive Director February 14, 2014

    Today, the Department of Justice and the Financial Crimes Enforcement Network division of the Treasury Department released long anticipated guidance to banks and other financial institutions on how they can interact with marijuana businesses that are licensed under state law.

    Under current regulations, financial institutions are required to file suspicious activity reports when they suspect the transaction has a drug connection. The new guidance creates a three tiered system for these reports: marijuana limited, marijuana priority, and marijuana termination. This will allow these institutions to work with marijuana businesses as long as they were operating in accordance with state laws and regulations. The Department of Justice reserved the right to pursue criminal charges when they suspect businesses are breaking the guidelines they released late last year and would still require banks to report any activity they suspect to be as operating outside of state regulations.

    “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,” noted FinCEN Director Jennifer Shasky Calvery in a press release. “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.”

    “This reduces the burden on banks,” FinCEN stated during a briefing on the memo, “Marijuana under federal law requires a SAR. Now, the necessity is limited, reducing the banks’ burden a bit and more importantly clarifies where law enforcement focuses its attention.”

    While this is a good start when it comes to allowing marijuana businesses to operate the same as those in any other regulated industry, memos such as these can be ultimately overturned by future administrations. To make this change lasting and binding, Congress must now act to codify it into law. The Marijuana Business Access to Banking Act is currently pending before the House of Representatives and would do just that. You can click here to quickly and easily write your representative and urge him/her to support this important legislation.

    You can view the full text of the memo from FinCEN here. The DOJ memo can be viewed here.

    25 responses to “Departments of Justice and Treasury Release Marijuana Banking Guidance”

    1. Don says:

      BAD DEAL!!!Only “Banks” will escape the wrath if the Fed`s should decide they want to go on a raiding Binge and seize ALL assets of everyone involved, DON`T FORGET – Cannabis is STILL listed as a Schedule I substance and I am afraid that all this will accomplish is to have all the money in one convenient place when the Fed`s decide to take it ALL Away, State Taxes you say? Have fun paying State And local taxes when they confiscate EVERYTHING you have under the Controlled Substances act and and then you are left owing a massive Tax bill, Then the IRS will calculate your sales and send a TAX bill for that TOO. NO, I WILL Not feel comfortable – And Nobody else should either- until it get`s Re-Classified or Eliminated from the Controlled Substances List, PERIOD!!!!

    2. devark says:

      Yeah, it needs to be off the controlled substances list now. I agree.

    3. Mr. Mitch says:

      Does this mean that banks will have guidelines that make lending money to marijuana businesses possible/easier? Would this make it much easier for an individual/group to start up a dispensary, if so?

      Correct me if I’m wrong, but haven’t the dispensaries in Colorado been holding their cash and using cash only payments? If the goal is to increase bank-dispensary compatibility will electronic payment be possible as well?

      Also, what other obstacles do dispensaries face with the banking system? What more action is needed to solidify this? And how much less of a burden would be lifted if rescheduling occurred?

      I’m also curious about the suspicion reports. The goal is to treat marijuana trade like any other legitimate business, but would bank institutions have to make any reports if say a company was operating alcohol or tobacco outside state regulations?

      Someone please enlighten me and give me your opinion.

      I can only hope that the right decisions are made from here on.

    4. Anonymous says:

      Sorry DOJ and FinCEN, try again. No business or bank in their right mind is going to proceed to do business with each other under these feeble guidelines. Get real, you’re so pathetic. Full legalization is inevitable at this point, you have to be a fool not to get that. So just give in and give up already fed gov’t, it’s only a matter of time. Every day of lost tax revenue from marijuana industry sales is gone forever, wise up, you, every state, and every bank need all the money you can get.

    5. bongstar420 says:

      Don, find an instance where the Supreme Court would actually hear a challenge to the Controlled Substances Act. You will not. They won’t actually try the law as it has no objective foundation. You see, it operates on a series of disproved facts that the court is aware of. Additionally, the authority to enforce the Controlled Substances Act is based on unprovable assumptions if you have not actually engaged in interstate commerce.

      I any case, the banks would be held just as liable given the circumstances you outlined as they would be documented participants. Additionally, the federal agencies charged with enforcement of the Controlled Substances Act have internal policies set by Supreme Court precedence that dictates non-action for amounts less than 100 plants or 100 pounds. I believe an annual clocking is the time frame for these amounts. At that rate, an individual can wholesale 75 lbs from 75 plants a year netting $90k annually without even eliciting a tick on the Fed’s radar according to their own internal policies set by Supreme Court precedent. Another way to put it is that a Federal agency will not bother with anyone below those numbers because the Supreme Court would not hear that case due to precedent that dictates the laws enforceability on that level (unless you were literally caught with merchandise in multiple states).

    6. Ray says:

      It’s another baby step. Full legalization will happen but this is painful to wait and watch.

      Maybe our government is afraid that they may have have to admit they made yet another mistake based on racial hatred. Yes, I’m talking about marijuana prohibition.

      By the way, Colorado didn’t burn in hell fire yet. If anything they are taking a stand for human compassion, dignity, and less government in our lives. Freedom must be fought for, it is never handed to you.

    7. Julian says:

      Yes, nullify the whole C.S.Act,… But in the meantime… THere are marijuana businesses dealing in cash… And did it ever occur to anyone what thus means for NORML PAC and marijuana investment firms?

    8. ANTON ROY says:


    9. nick says:

      The people of the United States of America and the Federal government need to recognize that the classification and scheduling of marijuana was signed into law back in 70 when one of the most corrupt presidents that didn’t even finish his term and a scrambled congress and senate from vietnam and protesters all the hippies so clearly this is so outdated as far as how the federal government looks at marijuana. This is a new century the taxed money the states can receive from marijuana businesses can clearly go to upgraded border patrol and security, healthcare and education. The publics opinion of marijuana clearly has changed from 40 years ago and studies on marijuana have proved to people that there is many uses to marijuana or hemp compared to alcohol even. The Controlled Substance Act doesn’t even makes absolutely no sense to me because how does a substance become a schedule 1 the worst of all and doesn’t even kill you. Clearly outdated.

    10. Don says:

      It seems to be that the Fed is baby stepping into legalization if you consider all the positive steps taken. They are setting up all “background” stuff so when weed is removed from sch 1 there wont be a lot of legal hurdles to jump over