This Wednesday, The U.S. House of representatives approved a bill that restricts the SEC’s and U.S. Treasury Department’s abilities to penalize financial institutions for working with legal cannabis companies. The Heck-Perlmutter-Lee-Rohrabacher Amendment passed with a bipartisan vote of 231-192.
Here’s the important language in the bill:
“None of the funds made available in this Act may be used, with respect to the States of Alabama, Alaska, Arizona, California, Colorado, Connecticut, Delaware, Florida, Hawaii, Illinois, Iowa, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, Oregon, Rhode Island, South Carolina, Tennessee, Utah, Vermont, Washington, or Wisconsin or the District of Columbia, to prohibit, penalize, or otherwise discourage a financial institution from providing financial services to an entity solely because the entity is a manufacturer, producer, or person that participates in any business or organized activity that involves handling marijuana or marijuana products and engages in such activity pursuant to a law established by a State or a unit of local government.”
This is a HUGE step towards Federal loosening of cannabis laws.
Because the DEA classifies cannabis as a schedule 1 drug, bank employees could be arrested for money laundering by accepting money that marijuana companies had legally earned per state laws. Banks faced huge fines and could be shut down for knowingly taking cannabis money.
We finally got PayPal to process credit cards for us and everything is fine now. We’d like to applaud PayPal for knowing the definition of free market American capitalism.
The problem caused by cannabis companies not being able to put their money in banks is crime. Security is always a concern for cash businesses. Think about why liquor stores, pawn shops, and ‘cash for gold’ places always have bars on the windows and bullet proof glass.
When criminals know that there is a ton of cash somewhere, that becomes a robbery target. A marijuana dispensary with $100k in cash is a great score for a piece of sh*t thief. Most states don’t allow dispensary owners and employees to carry guns, which makes them even easier targets. This is why dispensaries always have an armed security guard in the store.
Cannabis companies having bank accounts and credit card processing services is one more step towards legitimizing this real industry.
Make no mistake, though; this decision was not made for reasons of sanity or compassion. The banking industry’s lobby pressured this decision. The banks see the $billions of cash that the cannabis industry is literally growing and they want their piece of the action.
Once the IRS figures out how to tax pot, we’ll probably see cannabis growing on 1600 Pennsylvania Avenue.
Regardless of why congress passed this amendment, it is only good for us medical cannabis companies!