Now that Democrats have gained control of the U.S. House of Representatives, it seems they are committed to bringing the cannabis issue to the center stage. Their first line of business—a bill aimed at giving the marijuana industry access to banks. Although more than half the nation has legalized the leaf in some form or fashion, marijuana businesses have been mostly left to operate on a cash-only basis.
Not only has this presented safety issues—armed robberies where criminals are seeking large amounts of cash being among the biggest—but it has also made it difficult for these companies to pay their bills and set up payroll in a manner of which is appreciated by other members of traditional commerce.
But next week, a subcommittee of the House Financial Services Committee will hold a hearing intended to fix the banking problem. House members will examine a piece of legislation, which would allow banks to do business with the cannabis trade without the risk of prosecution for money laundering.
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Even though marijuana businesses might be legal in their neck of the woods, any money filtered through financial institutions is technically illegal since the federal government still considers the substances a Schedule I drug. And while no bank has been hassled as a result of these types of transactions, the risk is enough to prevent many of the larger firms from opening accounts connected to weed.
The new bill would provide protections for those banks operating inside the scope of state law.
“The legislation would provide credit unions and other financial institutions accepting deposits from, extending credit or providing payment services to an individual or business engaged in marijuana-related commerce in states where such activity is legal with appropriate legal protections, so long as they are compliant with all other applicable laws and regulations,” said Jim Nussle President of the Credit Union National Association.
Although giving pot companies access to banking solutions seems like a no-brainer, lawmakers have struggled in the past to get any kind of marijuana banking protections pushed through on Capitol Hill. The hang-up has been mostly the fault of Republican control. For whatever reason, the majority of these Elephant-eared politicians are not quite ready to give banks permission to do business with the cannabis industry. In fact, Republican control in the Senate could jam up this issue even more.
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Even if the bill gets through the House, it would still need to make it through Senate gatekeeper Mitch McConnell before it stands a fighting chance at going the distance. It remains to be seen, however, whether the upper chamber will present problems for this particular issue. We’ll have to wait and see.
One thing is sure, the banking measure will be the bill to watch, as its success or failure will dictate the course of marijuana reform in Congress for 2019. If it passes, other measures could find an easier passage. But if lawmakers cannot come to terms on a simple banking bill, there really isn’t much hope that anything more significant will land either in the coming months.
The subcommittee hearing is slated for February 13, with a full committee vote expected to take place before Spring.