State & Local Government Policy, Business and Technology

Trump Administration's Shift on Marijuana Could Imperil Banking Arrangements

Stateline: By rolling back an Obama-era memo that shielded legal marijuana users, growers and distributors from federal prosecution, U.S. Attorney General Jeff Sessions may compel many banks and credit unions to stop working with marijuana businesses.

That’s because the memo Sessions rescinded, drafted by former Deputy Attorney General James Cole, is the foundation of Treasury Department guidance that created legal space for banks and credit unions to offer accounts to marijuana dispensaries, grow operations, distributors and manufacturers.

Without access to the banking system, the rapidly growing marijuana industry — valued at $6.7 billion in 2016 — would have to rely on cash. That would make cannabis businesses, owners and employees vulnerable to theft and complicate state efforts to collect taxes on drug sales.

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