November 27th, 2020
Banking remains one of the top pain points for most cannabis businesses who have either opened accounts under false pretenses, or are paying exorbitant fees coupled with overbearing bank compliance officers to operate their businesses like any other.
Since 2017, the position of Senate Banking Committee Chairman has been held by Mike Crapo (R-Idaho). Earlier this month Crapo praised the Office of the Comptroller (OCC) and was quoted saying, “We are seeing a disturbing trend in the financial services industry – the intentional discrimination of entire industries, such as firearms manufacturers, by the largest banks in the United States. I commend the OCC for reaffirming that banks must not deny services or limit fair access to legal businesses and individuals. Business lending decisions should be based on creditworthiness, rather than politics or political pressure.”
Crapo’s seeming disgust in seeing people discriminated against might have you believe that he would be a champion for solving the current cannabis banking issues. However, Crapo digs guns more than pot; so when he says, “entire industries”, he means only industries that he likes. In December 2019 Crapo stated, “I remain firmly opposed to efforts to legalize marijuana on the federal level, and I am opposed to legalization in the State of Idaho. I also do not support the SAFE Banking Act that passed in the House of Representatives.” Oddly enough recent polls show 72% of Idahoans are in favor of legalizing marijuana, at least for medical purposes. Apparently “will of the people” doesn’t mean much to Crapo.
The good news (unless you live in Idaho and enjoy cannabis), is that Crapo’s chair seat will soon be occupied by Sen. Pat Toomey (R-PA). Senator Toomey represents a state which two years ago approved medical cannabis and may likely vote in full recreational use in the near future. Just this month dispensary sales in Pennsylvania surpassed $1 billion since the medical programs inception. Now that neighboring New Jersey is fully legal, Pennsylvania lawmakers are becoming increasingly concerned that New Jersey will become the recipient of marijuana tax dollars they could be collecting instead. I fully expect recreational cannabis in Pennsylvania to be legal by this time next year.
As for cannabis banking, incoming Chairman Toomey has stated, “I am sympathetic to the idea that people who are involved in the cannabis industry—in an entirely legal fashion, in the state in which they operate—ought to be able to have ordinary banking services.” Encouraging words for an industry who pays more than their fair share and asks for nothing more than equal treatment.