Removing Barriers Blog

Marijuana Legalized in California, Maine, Massachusetts and Nevada; Rejected in Arizona
Posted November 11, 2016 by CUNA Advocacy

Yesterday, voters in California, Maine, Massachusetts and Nevada voted to legalize the use of recreational marijuana while Arizona voters rejected legalization. Medicinal marijuana was also legalized in Arkansas, Florida and North Dakota in yesterday’s elections.

Many in the marijuana movement believe legalization in California, due to its large economy, will lead to intense pressure for federal legislation. Currently, marijuana businesses operating under state laws that have legalized medicinal or recreational marijuana have, for the most part, been denied access to the mainstream financial system because institutions that provide financial services can be prosecuted under federal law. This has led many of these businesses to operate using large amounts of cash, creating safety risks and making taxation difficult. 

Legislation previously introduced in the House and the Senate provides a safe harbor for depository institutions providing financial services to a legitimate marijuana-related business, prohibiting a federal banking regulator from:  

  • Terminating or limiting the deposit or share insurance of a depository institution solely because it provides financial services to a marijuana-related legitimate business; or  
  • Prohibiting, penalizing, or otherwise discouraging a depository institution from offering such services. Financial institutions would still be required to comply with current FinCEN guidance.

CUNA provided technical assistance to lawmakers on the legislation. CUNA and the leagues also supported a successful National Conference of State Legislators resolution urging Congress to help legal cannabis businesses access banking services and let states determine their own path forward on cannabis regulation.