Marijuana Legalization May Be on the Horizon in Virginia, But Questions Remain for Banks
Lawmakers in Virginia may be on the verge of legalizing marijuana. But, nobody is taking that news to the bank just yet.
Even if Virginia legalizes marijuana, it'll still be illegal at the federal level. That means banks consider proceeds from the cannabis industry money laundering.
Jenn Michelle Pedini at Virginia NORML says the medical marijuana industry in Virginia already operates as a cash-only business.
"On the consumer side, operators in Virginia aren't generally able to accept credit cards or ATM cards directly," Pedini explains. "So they are accepting cash and installing ATMs in the lobbies of their dispensaries and they are using apps that allow cashless payment."
Virginia legal exert Rich Kelsey says banking is a highly regulated business that puts a premium on compliance.
"The risk of running afoul of federal law whether you're truly going to be prosecuted, which many people think wouldn't happen, or whether you're just going to be dinged by your federal regulator, which most people think would happen," Kelsey says. "Banks just aren't going to do it."
The House of Representatives has already passed a bill that would allow banks to do business in states that have legalized. That bill had support from all of Virginia's Democrats in the House as well as Republican Congressmen Morgan Griffith and Denver Riggleman. But it hasn't seen any movement in the Senate yet.