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Treasury Secretary Wants Banks to Accept Marijuana Money

U.S. Treasury Secretary wants banks to open accounts for marijuana businesses so that the government can collect taxes.

Bipartisan groups in both the House and Senate Want Cannabis Banking Protection

U.S. Treasury Secretary Steven Mnuchin told the House Financial Services Committee that he wants banks to open accounts for marijuana businesses so that the government can collect taxes and “other things.” Mnuchin made the comments while testifying on Tuesday for the Committee, according to Forbes Magazine.

Mnuchin responded to the Committee’s public safety concerns regarding the amount of cash on hand that businesses can’t secure by saying that the Treasury Department doesn’t “want bags of cash,” laying around, adding that the safety issue is being dealt with by the Treasury Department.

The Treasury Department’s Financial Crimes Enforcement Network’s (FinCEN) previous recommendations permitted financial institutions to do businesses with marijuana businesses. FinCEN was created under President Obama to provide banks guidance when dealing with cannabis company customers.

The FinCEN requires banks to file a report on all marijuana customers, but many banks are still opting to decline opening accounts with such businesses because marijuana is still illegal under federal law.

Because Attorney General Jeff Sessions recently rescinded the Cole Memo, another Obama-Era policy that protected states with legal marijuana from federal prosecution, banks are even more wary about opening accounts for pot shops. They worry that the new administration will rescind the banking protections as well without warning. Mnuchin said that Sessions did not notify the Treasury Department prior to revoking the Cole Memo.

Mnuchin said that he is sensitive to the public safety issue and would like to see some sort of replacement guideline rather than removing the banking protections completely. "The intent is not to take it down without a replacement that can deal with the current situation," said Mnuchin.

Bipartisan groups in both the House and Senate have written letters requesting that the current administration maintain the banking protection guidelines set forth by President Obama.

Banking is undoubtedly the greatest point of weakness for the cannabis community and the Sessions memo directly forces financial institutions to rethink their comfort with marijuana business which would otherwise be safe under the Cole memo.