Washington took a big step towards ending the costly war on drugs in 2012 by legalizing the growth, retail, and use of recreational marijuana. Since then, the Liquor Control Board has been working hard to develop rules and regulations to govern this newly legal industry. However, there are still several institutional issues that must be dealt with. One such issue is where and how marijuana businesses will do their banking.
Currently, financial institutions that allow marijuana businesses to open bank accounts and processes transactions can be charged with violating federal drug laws. This has, understandably, led banks to refuse to render financial services to growers and retailers of recreational marijuana. In turn, most businesses are looking at operating as cash-only enterprises, which makes them more vulnerable to armed robbery and makes tax evasion much more difficult to detect.
U.S. Representative Denny Heck , elected in 2012 in Washington’s brand new 10th Congressional District, has introduced the Marijuana Business Access to Banking Act. The legislation would protect banks from prosecution by reconciling federal banking and drug laws with new state policies. It would allow marijuana businesses to make deposits, apply for loans and accept credit cards without putting the financial institutions at risk.
Heck and Colorado Representative Ed Perlmutter (CO-7) are the leading sponsors of the bill. Colorado voters also legalized recreational marijuana in 2012. It still has a long way to go in the legislative process, but progress is being made to tackle issue around recreational marijuana not just at a state level, but also federally as well.