Push To Protect Banks on Legal Pot Businesses
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Push To Protect Banks on Legal Pot Businesses
Posted by CN Staff on May 25, 2010 at 04:36:39 PT
By Kathleen Pender
Source: San Francisco Chronicle
California -- Fifteen U.S. representatives, including seven from California, are urging the Treasury Department to say it won't "target or pursue" national banks that do business with medical marijuana distributors operating legally under state laws.In a letter to Treasury Secretary Timothy Geithner, the lawmakers said, "dispensary operators are finding it increasingly difficult to maintain accounts with financial institutions."
That may be true of national banks, but many state-chartered banks are happy to do business with medical marijuana dispensaries, as long as they are operating legally.Medical marijuana is legal in 14 states, including California, and many more states - out of compassion or the need for new tax revenues - are considering legalizing it. California voters will decide in November whether to make it legal for recreational use as well.But growing and distributing marijuana is still illegal under federal law and for that reason, many national banks won't do business with medical marijuana distributors. Bank of America, Chase and U.S. Bank all confirmed that they won't do business with medical marijuana distributors, even in states where it is legal.Wells Fargo said it stopped opening new accounts with medical marijuana dispensaries this month and is reviewing its existing accounts with them. "In general, we follow federal, not state, law," says Wells spokesman Chris Hammond. "The decision was made to have a consistent standard." State vs. Federal  National banks have often claimed that they are exempt from state consumer protection and other laws because federal laws pre-empt them. In many cases, the courts have agreed with them. So it could appear inconsistent for a national bank to claim exemption from some state laws yet agree to do business under others.Federal pre-emption is a big issue in the financial reform bill being debated in Congress.Some Bay Area dispensaries say they've had no problem opening business checking accounts. Snipped   Complete Article: San Francisco Chronicle (CA)Author: Kathleen PenderPublished: Tuesday, May 25, 2010Copyright: 2010 San Francisco Chronicle Contact: letters sfchronicle.comWebsite: CannabisNews  Medical Marijuana Archives
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