Bradley attorney Whitt Steineker was quoted in Super Lawyers on the risks banks face when working with marijuana industry companies. Many states have recently legalized the recreational and/or medicinal use of marijuana and other cannabis products. To fill this new demand, a wide variety of cannabis businesses have popped up all around the country. However, marijuana use remains prohibited at the federal level, which makes it complicated for banks to provide services to the industry.
“Right now, banks are in a difficult position,” Steineker said. “It is likely to be a violation of the money laundering statutes for a financial institution in the United States to accept the proceeds of the growth or sale of marijuana. If we were talking about hemp, for example, then, under certain circumstances, it would not be unlawful … and wouldn’t implicate money laundering issues.”
“There certainly are banks and credit unions in the United States that are accepting deposits from marijuana companies—we know that, anecdotally,” Steineker said. “As far as I can tell, those financial institutions have just made a judgment call, that the benefits of providing those services and the revenue they generate from those services outweigh the risks that federal law will be enforced. The reality is that you don’t hear many stories about banks being prosecuted for money laundering in states where it’s legal—under state law—to grow or sell marijuana for some purpose.”
“I will say that it’s passage in the Senate seems more likely than it did six months ago, or a year ago, and that would really fundamentally change this whole system,” Steineker added. “Bu that’s not the law yet, and even if it passes, there’s probably some dead period where they would wait on the Treasury Department to issue guidance.”
The complete article, “Can a Bank Work With a Cannabis Business Legally?,” first appeared in Super Lawyers on October 28, 2019.