need to address the public safety, crime and lost tax revenue associated when
these legal and regulated businesses are operating in a cash-only system"
Today, U.S. Reps. Ed Perlmutter
(CO-07) and Denny Heck (WA - 10), along with a bipartisan group of 16 other Republicans and Democrats, are proposing
sensible reforms of federal banking laws relating to marijuana
businesses. The Perlmutter/Heck bill updates federal banking rules to
resolve conflicts between federal and state laws, promoting community safety
and financial security.
Currently, under federal banking laws, many legal, regulated
legitimate marijuana businesses that follow state law are prevented from
opening bank accounts and operating as any other
businesses would. They are therefore forced to operate as cash-only
enterprises, inviting crime such as robbery and tax evasion and adding to the
burden of setting up a legitimate small business.
"We need to address the public safety, crime and
lost tax revenue associated when these legal and regulated businesses are
operating in a cash-only system,” said Congressman Ed Perlmutter (CO-07).
“We also need to provide financial institutions assurance that they can make
their own business decisions related to legal, financial transactions without
fear of regulatory penalties or criminal prosecution."
“As a small business owner, I can’t imagine trying to
operate a legitimate business without access to the banking system. Forcing
legitimate businesses to operate on a cash-only basis without bank accounts is an
invitation for robbery, tax evasion and organized crime. With twenty-one states
and D.C. now allowing for some form of legal adult marijuana usage, federal law
needs to be updated to reflect the reality of the situation in the states,”
said Congressman Denny Heck (WA-10).
Colorado and Washington recently legalized recreational
adult-use of marijuana and are in the process of crafting rules, regulations
and tax mechanisms for the product. Additionally, 19 other states and the
District of Columbia have approved medical marijuana programs.
In all of these states, federal laws are presenting criminal
and regulatory barriers to financial institutions, prohibiting them from
accepting licensed growers, retailers and dispensaries as ordinary banking
The result is legitimate, licensed and regulated businesses
have extreme difficulty accessing the banking system to accept credit cards,
deposit revenues, or write checks to meet payroll or pay taxes.
The Marijuana Business Access to Banking Act would allow
banks, credit unions and other depository institutions the legal clearance to
provide banking services to a marijuana-related legitimate business, ensuring
these businesses do not have to operate on a cash-only basis.
Bi-partisan Co-Sponsors include:Denny Heck (WA), Jim McDermott (WA), Earl Blumenauer (OR), Jared Polis
(CO), Adam Smith (WA), Sam Farr (CA), Derek Kilmer (WA), James Moran (VA),
Eleanor Holmes Norton (DC), Michael Capuano (MA), Suzan DelBene (WA), Mike
Coffman (CO), Diana DeGette (CO), Peter DeFazio (OR), Alan Lowenthal (CA),
Chellie Pingree (ME), and Dana Rohrabacher (CA).
Below are more details about the bill and news reports
highlighting the need for the legislation.
Under the bill, federal banking
regulators may not:
- threaten or
limit a depository institutions' access to the Deposit Insurance Fund
prohibit, or penalize depository institutions
- take any
action against a loan made to a covered business
- force a
depository institution to halt providing any kind of banking services
Additionally, any depository
institution and/or the employees shall be immune from federal prosecution or
investigation solely for providing banking services to a covered business.
Under the legislation, a covered
"financial product and service" includes:
and/or extending credit and servicing such loans
- extending or
brokering leases of real property, providing real estate settlement
- engaging in
depository-taking activities, transmitting or exchanging funds on behalf of
providing, or issuing stored value or payment instruments
check cashing, check collection or check guaranty services
payments or other financial data processing products or services
financial advisory services
debt related to any consumer financial product or service
The legislation covers the
following "marijuana-related legitimate business" which hold
and maintain s a license from a state or local government to engage in
grower and producer
- any business
who handles, sells, transports, displays or distributes marijuana or
- "Marijuana taxes as a cash cow? Think again"
- "Pot Shops Can’t Take American Express or Deposit in Banks"
Post - "Pot businesses in Colorado cannot bank and no solution is
Sound Business Sound - "You pay taxes, but can't get a bank account
because your business is selling marijuana"
- "Selling Pot Legally? Good Luck Opening a Bank Account"