Congress Asked to Address Medical Cannabis Banking Conflict
Questions have always loomed about how dispensaries here in Hawai‘i will be able to use banks locally to safeguard their cash reserve.
Hawai‘i Commissioner of Financial Institutions Iris Ikeda joined a coalition of thirteen state banking regulators—lead by Pennsylvania’s Robin L. Wiessmann—asking Congressional leaders to consider legislation that creates a safe harbor for financial institutions to serve businesses operating legally under state law or to entrust states with the full oversight and jurisdiction of cannabis-related activity.
Commissioner Ikeda and regulators from the other states sent a letter to Congress describing the well-documented conflict between federal and state law, which has created barriers for financial institutions desiring to serve businesses involved in state-licensed cannabis activities. The regulators cite a lack of clarity by the federal government for how financial institutions can serve this industry, without the threat of forfeiture of assets or criminal penalties, which results in many transactions occurring in cash. They shared their concerns with respect to public safety, increased difficulty of tracking the flow of funds, and contributions to a loss of economic activity, workforce development, and community development opportunities.
“With 31—and possibly more—states allowing legal medical cannabis programs, we must find a solution to address the serious public safety concerns in having a cash intensive industry,” stated Ikeda. “We believe it is important to craft policy to respond to emerging challenges in this rapidly growing industry. We cannot ignore this federal-state conflict in laws which may make consumers who need to use this solution for treating their medical conditions feel like criminals.”
As of Aug. 1, 2018, 31 states, the District of Columbia and the territories of Guam and Puerto Rico have legalized medical and/or recreational cannabis usage.