Medical Marijuana Businesses Face Banking Woes Amid Push for Legal Pot
Colorado and Washington have legalized the sale of recreational marijuana, and at least four more states are likely to follow suit this year. But those pushing for legal pot are overlooking the problems that even medical marijuana dealers face in availing basic banking services.
At the beginning of this year, America's first recreational marijuana stores opened in Colorado, where voters approved marijuana legalization in November 2012 along with Washington. And smoking weed may become legal in Alaska, Oregon, California and Arizona in 2014, according to USA Today.
There are 18 other states, excluding the District of Columbia, that allow medical marijuana use.
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But the Controlled Substances Act of 1970 still categorizes marijuana as a drug that is as dangerous as heroin, LSD and ecstasy. Therefore, it's natural for banks, including state-chartered ones, to show reluctance in providing services to marijuana businesses, whether they deal in recreational or medical marijuana.
Marijuana businesses are conducted almost entirely in cash, reports The New York Times, explaining that banks fear federal regulators and law enforcement authorities can potentially take punitive action, including large fines, against them for violating federal laws and regulations.
"Banking is the most urgent issue facing the legal cannabis industry today," Aaron Smith, executive director of the National Cannabis Industry Association in Washington, D.C., tells Times. Smith adds that legal marijuana sales in the country could reach $3 billion in 2014. "So much money floating around outside the banking system is not safe, and it is not in anyone's interest. Federal law needs to be harmonized with state laws."
Many businesses choose nondescript company names, but banks shut down their accounts sooner or later. Some legitimate marijuana business go through a half-dozen bank accounts in a few years, Times said. For example, a credit union, BECU, in Washington State shut down about 20 accounts in the last three years after discovering they were for businesses in the legal marijuana trade.
When it comes to recreational marijuana, there's also a social hurdle.
While a CNN/ORC International survey released last Monday indicated that the number of people who say smoking pot is morally wrong has plunged, the findings suggested the increase in support cannot be generalized.
Fifty-five percent of respondents said marijuana should be made legal, but 44 percent disagreed, according to the survey.
"There are big differences on age, region, party ID, and gender, with senior citizens, Republicans, and Southerners the only major demographic groups who still oppose the legal use of pot," said CNN Polling Director Keating Holland.
Two-thirds of those between the ages of 18 and 34 said marijuana should be legal, but only 39 percent of those age 65 and older agreed.
Regionally, 60 percent in the Northeast favored legalization of marijuana, 58 percent in the West, 57 percent in the Midwest, but just 48 percent in the South.
Among Democrats, the support stood at 62 percent. And 59 percent of Independents agreed, but just 36 percent of Republicans backed legalizing marijuana.
Gender wise, 59 percent of men but just 51 percent of women supported making pot legal.
