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Green day for banks as feds to adjust rules for legal pot shops

Published time: January 24, 2014 14:46
AFP Photo / Desiree Martin

AFP Photo / Desiree Martin

​The Obama administration has decided that state-sanctioned pot dispensaries should have access to the US banking system, even though marijuana remains illegal under federal law.

Details remain scant at the moment, but Holder said the new rules will help marijuana growers and retailers, in the 20 states that have legalized the drug for recreational or medical use, operate beyond a cash only basis.

Currently, proprietors of pot dispensaries are forced to keep large amounts of cash on hand to purchase inventory, pay employees and make transactions, rendering them optimal targets for robbery.

It also gums up book keeping for state-level tax collection.

"You don’t want just huge amounts of cash in these places. [Marijuana sellers] want to be able to use the banking system," Attorney General Eric Holder said on Thursday.

“There’s a public safety component to this. Huge amounts of cash—substantial amounts of cash just kind of lying around with no place for it to be appropriately deposited - is something that would worry me, just from a law enforcement perspective."

Processing money from marijuana sales, however, puts federally insured banks at risk of drug racketeering charges, making the entire industry a no-go zone for the industry.

Holder said “we’re in the process now of working with our colleagues at the Treasury Department to come up with regulations that will deal with this issue."

However, he made it clear they would not amount to federal approval for the pot market.

"It is an attempt to deal with a reality that exists in these states," he said.

A Justice Department spokesman later "clarified" Holder's remarks, saying that the government was preparing to issue “guidance” to prosecutors and federal law enforcement agencies.

It will take legal guarantees that banks won’t be slapped with money laundering charges for dealing with pot proprietors to get them on board.

Earlier this week, President Obama came out saying he believed marijuana was no more harmful than alcohol or cigarettes.

Obama expressed his approval for the Justice Department’s promise to target drug dealers rather than individual drug users.

“We should not be locking up kids or individual users for long stretches of jail time, when some of the folks who are writing those laws have probably done the same thing,” Obama said. He added it was “important for society not to have a situation in which a large portion of people have at one time or another broken the law and only a select few get punished.”

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