California Bill Looking to Legalize Banking for Cannabis Industry
Late last month, a proposed bill was introduced by state Sen. Robert Hertzberg (D-Van Nuys) to allow banks to open accounts for people involved in the cannabis industry. The bill, Senate Bill 930, would allow California chartered banks, credit unions and other financial institutions to open checking and savings accounts and issue checks for marijuana retailers. SB 930 is an attempt to deal with U.S. Drug Enforcement Administration rules that still classify cannabis as a Schedule I drug, which forbids banks from opening accounts for marijuana businesses. Senator Hertzberg stated,
These businesses handle significant economic activity, yet they are forced to operate under the table and with little government oversight, as if they’re a black-market operation. [This bill] will integrate these businesses into the fabric of the California economy.
Federal law has forced marijuana retailers to conduct almost all its business in cash. Fiona Ma, a member of the California State Board of Equalization, claims that the bill would authorize privately insured financial firms to open accounts, issue checks, and take deposits. The bill would also allow marijuana retailers to pay employees with checks and make electronic and wire payments. Ma also acknowledged there will be some opposition to the bill, but that it would ultimately be good for the government by “[providing] a paper trail so the government can make sure everybody is paying their fair share of taxes.” We will have to wait and see if the bill is passed, and if it is passed, how the federal government will respond.