Now The Attorney General Has Decided Also Not To Enforce Banking Regulations Against Banks That Deal With Marijuana Sellers

January 26th, 2014

As it stands, the government has taken the position that they will not prosecute people for possessing marijuana in Colorado and Washington, where it is legal under state law. Now, the Attorney General has suggested that the government will promulgate a “regulation” (who needs statutes when you have regulations?) saying that these banks will not be prosecuted.

The Obama administration will soon announce regulations to make it easier for banks to do business with legal marijuana sellers, Attorney General Eric Holder said Thursday.

“You don’t want just huge amounts of cash in these places. They want to be able to use the banking system,” Holder said during an appearance at the University of Virginia’s Miller Center. “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.”

While Holder spoke twice of new “regulations” that were being prepared, a Justice Department spokesman said later that the attorney general was referring to legal “guidance” for prosecutors and federal law enforcement. Such a legal memo wouldn’t be enforceable in court and would amount to less than the kind of clear safe harbor many banks say they would want before accepting money from pot businesses. …

“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,” Holder said. He added that the new rules were likely to emerge “very soon” and were not intended to amount to a blessing of marijuana by the federal government. “It is an attempt to deal with a reality that exists in these states,” he said.

Isn’t that reassuring? I’m sure heavily regulated banks will run this gamble. Of course, what happens if Attorney General Chris Christie changes his mind. Would all the banks who did business with these pot distributors be culpable?

If true, that likely won’t be enough reassurance for banks. How do they know that once they have loans outstanding to marijuana retailers, Ted Cruz won’t be elected president in 2016 and simply change the prosecution directive? “Banks will need a lot of detail from regulators to get the satisfaction and comfort they are looking for,” Richard Riese, senior vice president for regulatory compliance at the American Bankers Association, told the Times.

The lawlessness of selective prosecution continues unabated.