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ReadersSpeak





        Are states rights on the horizon for marijuana businesses?                 thorities might punish them for
                                                                                   violating money-laundering laws,
                     e received the following perspective from Josh Herndon, an attor-  as well as other federal statutes and
                     ney at Global Legal Law Firm:                                 regulations. That, in turn, has pre-
                                                                                   vented marijuana businesses from
        W Marijuana is currently listed as a federally controlled substance        opening  and maintaining  bank  ac-
        in the Controlled Substances Act (CSA). That, in turn, has negatively impacted   counts, obtaining capital invest-
        marijuana businesses, which have been forced to conduct business almost en-  ments and loans, and accepting debit
        tirely in cash. That is because banks (which are federally regulated) have been   and credit cards.
        reluctant to provide services to marijuana businesses for fear that federal au-
                                                                                   However, the Strengthening the Tenth
                                                                                   Amendment Through Entrusting States
                                                                                   (STATES) Act would amend the CSA
                                                                                   and  remove  marijuana from the
                                                                                   schedule of drugs that are illegal in
                                                                                   states that have legalized recreation-
                                                                                   al and/or medicinal marijuana, such
                                                                                   as California and Colorado. In es-
                                                                                   sence, the act would end the federal
                                                                                   prohibition of marijuana in states
                                                                                   where recreational and/or medicinal
                                                                                   marijuana is legal.

                                                                                   If the STATES Act passes, it will be
                                                                                   enormously beneficial to marijuana
                                                                                   businesses because banks and finan-
                                                                                   cial  institutions  in states  that  have
                                                                                   legalized recreational and/or medic-
                                                                                   inal marijuana will be free to work
                                                                                   with and offer services to any canna-
                                                                                   bis business that complies with the
                                                                                   laws of those states.

                                                                                   Although the status of the STATES
                                                                                   Act is uncertain, President Trump
                                                                                   has indicated he supports the rights
                                                                                   of states to legalize marijuana, even
                                                                                   though such rights are opposed by
                                                                                   elected officials in his own party.
                                                                                   Interestingly, the act has exposed a
                                                                                   rift between Republican elected of-
                                                                                   ficials who oppose legalization and
                                                                                   growing numbers of rank-and-file
                                                                                   Republicans who favor federal pro-
                                                                                   tections such as the STATES Act for
                                                                                   their states' marijuana businesses.
                                                                                   Stay tuned for future developments
                                                                                   concerning this act.
                                                                                   Do you have an opinion to share?

                                                                                   We appreciate Josh Herndon for
                                                                                   sending in this note on pending
                                                                                   legislation that could dramatically
                                                                                   affect the payments industry's ability
                                                                                   to process payments for cannabis-
                                                                                   related businesses. Why not send
                                                                                   in your opinions, too? Please send
                                                                                   up to 300 words for this page to
                                                                                   editor@greensheet.com.

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