According to the Marijuana Moment online publication, the FinCEN data shows that at the end of the last quarter of 2018, there were 438 banks and 113 credit unions actively servicing cannabis businesses. By March 2019, those numbers grew to 493 and 140, respectively.
The Treasury Department’s Financial Crimes Enforcement Network (FinCEN), tracks financial services for the marijuana industry by analyzing suspicious activity reports, or SARs, that institutions file in accordance with cannabis banking guidance issued by the Obama administration in 2014.
"While banks run the risk of being penalized by financial regulators by accepting cannabis business accounts because their products are still federally controlled substances, an increasing number of them are willing to take that chance. The latest update of quarterly numbers, posted late last month, comes as bipartisan legislation that would protect banks that service state-legal markets advances toward the House floor for a vote," the publication says.
“As of 31 March 2019, FinCEN has received a total of 81,725 SARs using the key phrases associated with [marijuana related businesses],” the federal agency wrote.
FinCEN also breaks down the types of SARs the banks and credit unions reported for marijuana businesses. The vast majority (61,036) were considered “marijuana limited,” a term that refers to cannabis businesses that appear to be operating in compliance with state law and meet the agency’s standard for being serviceable under existing federal guidelines.
About 6,000 were defined as “marijuana priority,” which means they “may raise one or more of the red flags” under federal guidelines or they “may not be fully compliant with the appropriate state’s regulations” and are thus under investigation while the banks continue to service the businesses.
Finally, about 20,000 were marked as “marijuana termination.” That means has the cannabis business has violated at least one federal enforcement priority or state regulation and so “the financial institution has decided to terminate its relationship with” the business.
The Secure and Fair Enforcement (SAFE) Banking Act would do a lot to resolve uncertainty in the banking sector as it concerns marijuana. The bill cleared the House Financial Services Committee in March and is expected to get a full House floor vote next month.
Advocates argue that providing for the lawful banking of cannabis businesses would increase financial transparency, mitigate public safety risks associated with operating on a largely cash basis and simplify the tax process.
The legislation enjoys broad support outside of Congress as well. Twenty U.S. governors recently signed a letter encouraging its passage, as did banking associations representing all 50 states, a coalition of state attorneys general and another comprised of state treasurers.
“State and federal governments have a shared interest in upholding the rule of law, protecting public safety, and transitioning markets out of the shadows and into our transparent and regulated banking system,” they wrote. “Without access to banking services, state-licensed cannabis businesses operate predominantly on a cash basis.”
“Despite legalization of cannabis at the state-level—in many cases to provide medical treatment—our financial institutions face enormous barriers, legal risks, and criminal and civil liability under the Controlled Substances Act that prevent them from providing banking services to state-licensed businesses. As a result, very few banks and credit unions will provide these services, leaving many businesses in this sector unbanked,” the governors say.
Proud to join nineteen governors in urging Congress to allow state-licensed cannabis businesses to access federally regulated banking services, allowing them to implement better practices that will enhance public safety and encourage transparency. pic.twitter.com/9nrysPDIS0— Governor Phil Murphy (@GovMurphy) June 14, 2019
Meanwhile, an annual spending bill that covers the Treasury Department and includes temporary language protecting banks from being punished for working with cannabis businesses is on the House floor this week.
- Countries: United_States
- Cannabis may be a safer alternative for people who use drugs during sex
- Tweets about cannabis’ health benefits are full of mistruths
- Drug experts on the new guidance for medicinal cannabis
- JAMAICA | Import/Export Regulations for Cannabis Soon
- Jamaica should Benefit From Reforms Relating to Cannabis – CLA Director