Banks May Soon Be Allowed to Process Marijuana Sales

Monday, 13 Jan 2014 07:16 AM

By Dan Weil

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While federal law now forbids banks and credit card companies from processing marijuana transactions, that could change soon.

"Discussion with [the Justice Department] to bring clarity to these issues for banks are underway," Steve Hudak, spokesman for the Treasury Department's Financial Crimes Enforcement Network, told CNBC.

"Banks are obligated to report suspicious activity, but everyone involved is earnestly looking for a solution to this problem."

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A total of 20 states have legalized pot for medical use, and Colorado and Washington have legalized it for recreational use. But federal law is lagging when it comes to banks.

"Everyone at this point is working together, so it's just a matter of having a lot of different government agencies and bureaucracies . . . all on the same page," said Dan Riffle, director of federal policies for the lobbying group Marijuana Policy Project, according to CNBC.

"We can find a solution that will make the banking services available to this industry."

Banks are now afraid of doing business at all with marijuana sellers out of fear the banks may face money-laundering charges, Riffle said.

Meanwhile, in Colorado, Visa and MasterCard are ignoring their own rules prohibiting the use of their debit and credit cards for marijuana purchases, people familiar with the situation told The Wall Street Journal.

The card companies have decided to mimic the federal government, which has decided against appealing laws that legalize marijuana.

Although big banks and other major processors generally won't handle marijuana transactions, numerous independent middlemen are stepping into the void, The Journal reported.

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