The state-legal marijuana sector operates in a largely cash-based economy—only about 400 banks and credit unions in the U.S. actively provide financial services to this sector—because marijuana remains illegal under federal law, despite the increasing number of states acting to legalize medical and/or recreational use. There is no carveout for state-legal activity and no safe harbor for financial institutions to serve customers engaged in such activity.
Until last week, though, banks and credit unions wanting to work with this sector could rely to some degree on guidance from the U.S. Department of Justice (DOJ) and from the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN). Now, with the DOJ guidance withdrawn and the fate of the FinCEN guidance in question, the future of marijuana banking faces even more uncertainty.
Continue Reading The Challenges of Marijuana Banking Just Got Even More Challenging