Feds To Loosen Banking Regs, Stop Prosecution For Dealing With Pot Shops [VIDEO]
January 24, 2014 3:55pm PST
If you live in a state that has legalized marijuana, you know that the only way you can get your hands on the magnificent green goods is to pay with cash, and only cash. The reason for this is that under federal law, banks can be prosecuted for money laundering if they handle the transactions from the dispensaries and shops where it’s legal. This has been a problem for shop owners, who not only can have hundreds of thousands of dollars worth of product in stock at any given time, but also have all the cash from their customers, making them a target for would-be thieves and others up to no good. The other problem the business owners face is not being able to get financing for expansion, construction, or pretty much anything to do with their business since under federal law they’re not even supposed to be doing it and the banks see it as too much of a risk since they could get raided at any time.
Slight reprieve came for the business owners back in August when Eric Holder announced his Justice Department would be giving the states that want to experiment with legalization and taxation some latitude, taking some of the worry of getting busted off of the shoulders of business owners. However they still faced the problem of not being able to get loans or accept debit/credit cards and having to deal in all cash.
(Read More: Obama: Alcohol More Dangerous Than Marijuana)
Currently Colorado is the only state that allows the sale of marijuana for recreational use, with Washington state soon to follow and other states having it legalized for medical purposes only.
Well on Thursday at the University of Virginia, Eric Holder announced that the Treasury and law enforcement agencies, like the DEA and ATF, will be issuing new regulations that help to address the issues that the banks and business owners both face.
“You don’t want just huge amounts of cash in these places,” Holder said, adding that “They want to be able to use the banking system. And so we will be issuing some regulations I think very soon to deal with that issue.”
(Read More: Coming Soon: Marijuana Smoking Clubs?)
He didn’t get into any specifics on when the new regulations would be rolled out, but he did mention that from a law enforcement perspective the current situation isn’t desirable;
“There’s a public safety component to this,” he said. “Huge amounts of cash – substantial amounts of cash just kind of lying around with no place for it to be appropriately deposited – is something that would worry me just from a law enforcement perspective.”
Should this happen you’ll see a sudden surge in marijuana sales and shops in the states where it’s legalized as both banks and businesses jump at the opportunity to welcome more customers, expand, and accept more forms of payment. It’ll be a welcome boost to the economies that allow it, and may prompt other states to work towards legalization as well.
While I personally am in favor of legalization because of the income possibilities from both a tax and a business perspective, I can’t help but wonder if these rule changes are politically motivated for the democrats to take advantage of in the coming elections. Recent polls have shown that both Obama and the democrats are taking a hit amongst the youth vote because of the disastrous rollout of Obamacare, and polls also show that our nation’s youth are the ones most in favor of legalization. Let’s also not forget that just about everything this administration does is politically motivated in one way or another, and this seems to directly aimed at gaining favor back from those who are turning on them.
Even if it is politically motivated, this is one policy issue I believe I can agree on.