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DEA Wary Banks Back Away from MMJ Operations
Posted by CN Staff on June 17, 2011 at 10:47:11 PT
By Reuters
Source: Chicago Tribune 
USA -- Marijuana dispensaries in U.S. states that sell legalized medical pot are struggling to obtain service from banks and credit-card companies, pressured by federal authorities who consider illegal the business estimated at $1.7 billion annually.Operators and supporters of marijuana dispensaries say banks are turning away their business because they risk falling afoul of anti-money-laundering and drug-trafficking laws.
The largest U.S. bank, Bank of America Corp, said it started withdrawing services from dispensaries after receiving a warning from the Drug Enforcement Administration in late 2007 or early 2008. The DEA said it has also told other big banks that they face potential legal liabilities if they do business with the dispensaries."It was a nightmare," Sue Harank, co-owner of Denver-based dispensary Alpine Herbal Wellness, said of her efforts to find a bank. The shop opened in March 2010, and two banks and a credit union closed her accounts within six months, she said."Both banks and the credit union pursued our business initially and said they had talked to the corporate office and run it through legal, but a month or two later they all reversed themselves," she said.A study by financial-analysis firm See Change Strategy said the medical marijuana business would be worth $1.7 billion in 2011 and is growing. While some states have legalized dispensaries, the federal government does not recognize states' authority to do so and it considers the businesses illegal."They're operating according to state law, but because of conflict with federal law, they can't get credit card processing services and they can't keep bank accounts open," said Keith Stroup, founder of NORML, a lobbying organization working to legalize marijuana.NORML says 16 states and the District of Columbia have enacted various medical-marijuana use statutes. Some states allow sales through dispensaries, while others require the users to grow the marijuana themselves.Supporters of medical marijuana say the drug helps patients with chronic illnesses including cancer, AIDS and multiple sclerosis. Critics say the dispensaries cater more to recreational pot users than patients.The biggest two states for the medical marijuana business are California, with a market size of $1.3 billion, and Colorado, which is considered the most business friendly.In October 2009, Deputy U.S. Atty. Gen. David Ogden issued a memorandum that said the Justice Department was unlikely to pursue individual cancer patients and others who use marijuana as intended by state medical-use laws.But Ogden also said "prosecution of commercial enterprises that unlawfully market and sell marijuana for profit continues to be an enforcement priority of the department."The memo says that evidence of money laundering or excessive profits might be a reason for targeting a dispensary.Bank of America spokeswoman Shirley Norton said the bank started exiting its relationships with dispensaries after getting the DEA alert. "We do not provide banking services to medical marijuana businesses," Norton said.DEA spokesman Rusty Payne confirmed that the administration advised Bank of America that marijuana, medical or otherwise, is illegal under federal law and that offering financial services to dispensaries "can open you up to liability."Financial institutions have not been specifically targeted by the Justice Department for prosecution for serving dispensaries, and President Barack Obama has stuck by a campaign vow to halt widespread raids of medical-marijuana facilities.However, department spokeswoman Jessica Smith pointed to guidance letters drafted by federal prosecutors in California, Illinois and Arizona which characterized dispensaries, in general, as drug traffickers.Source: Chicago Tribune (IL)Published: June 17, 2011Copyright: 2011 Chicago Tribune CompanyContact: http://drugsense.org/url/2a8fnVeRWebsite: http://www.chicagotribune.com/URL: http://drugsense.org/url/XzF188H7CannabisNews Medical Marijuana Archiveshttp://cannabisnews.com/news/list/medical.shtml
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Comment #10 posted by Hope on June 18, 2011 at 11:55:59 PT
Afterburner....
It is a great opinion piece, isn't it? And a great man... no doubt.
[ Post Comment ]


Comment #9 posted by afterburner on June 18, 2011 at 09:24:08 PT
Hope #7 - Jimmy :D :D :D :D :D :D :D
Jimmy :D :D :D :D :D :D :D :D :D :D :D :D :D :D :D The kind of heart & vision that America needs... Today! 
:D :D :D :D :D :D :D :D :D :D :D :D :D :D :D :D 
[ Post Comment ]


Comment #8 posted by Tim on June 18, 2011 at 04:07:17 PT:
Election
Let's elect Jimmy Carter for President again!
[ Post Comment ]


Comment #7 posted by Hope on June 18, 2011 at 01:44:16 PT
Jimmy Carter, the 39th president
Call Off the Global Drug War
By JIMMY CARTERhttp://www.nytimes.com/2011/06/17/opinion/17carter.html
[ Post Comment ]


Comment #6 posted by dongenero on June 17, 2011 at 13:26:21 PT
Bank of America
DEA spokesman Rusty Payne confirmed that the administration advised Bank of America that marijuana, medical or otherwise, is illegal under federal law and that offering financial services to dispensaries "can open you up to liability."And of course Bank of America and all the other major banks are still relying on massive injections of liquidity from the Feds to keep them from being dragged under by their liabilities on the unregulated and disastrous derivatives market...which has still not been addresses from the 2008 crash.Drugs?....this is your financial industry on greed and unmitigated risk. How about a "War on Financial Industry Malfeasance". 
[ Post Comment ]


Comment #5 posted by dongenero on June 17, 2011 at 13:11:15 PT
We The People
If you need to fix legislation, you fix your legislators.
[ Post Comment ]


Comment #4 posted by dongenero on June 17, 2011 at 13:08:47 PT
Land of the ..........?
Legalize it.Make Americans free again.
[ Post Comment ]


Comment #3 posted by CaptainAjnag on June 17, 2011 at 12:54:56 PT:
We the people,
NEED A NEW PRESIDENT.
[ Post Comment ]


Comment #2 posted by HempWorld on June 17, 2011 at 12:27:41 PT
Meanwhile in Mexico ...
Banks Financing Mexico Gangs Admitted in Wells Fargo Deal
By Michael Smith - Jun 28, 2010 9:00 PM PT June 29 (Bloomberg) -- Wells Fargo & Co., which bought Wachovia Corp. in 2008, has admitted in court that its unit failed to monitor and report suspected money laundering by narcotics traffickers. Bloomberg's Erik Schatzker reports. (Source: Bloomberg) June 29 (Bloomberg) -- Martin Woods, former director of Wachovia Corp.'s anti-money-laundering unit in London, talks with Bloomberg's Julie Hyman and Mark Crumpton about the use of Wachovia Corp. and others by Mexican drug cartels to launder funds. Bloomberg Markets Magazine senior writer Michael Smith reports in the magazine's August 2010 issue that Wells Fargo & Co., which bought Wachovia in 2008, admitted in court that its unit failed to monitor and report suspected money laundering by narcotics traffickers. (Source: Bloomberg) June 29 (Bloomberg) -- Bloomberg Markets Magazine senior writer Michael Smith discusses the use of Wachovia Corp., Bank of America Corp. and others by Mexican drug cartels to launder funds. In the magazine's August 2010 issue, Smith reports that Wells Fargo & Co., which bought Wachovia in 2008, admitted in court that its unit failed to monitor and report suspected money laundering by narcotics traffickers. Smith speaks with Betty Liu on Bloomberg Television’s “In the Loop.” (Source: Bloomberg) A U.S. Customs and Border Protection agent inspects a vehicle heading into the U.S. at the San Ysidro border crossing in San Diego. Photographer: Scott Dalton/Bloomberg Markets via Bloomberg A U.S. Customs and Border Protection agent inspects a vehicle heading into Mexico at the San Ysidro border crossing in San Diego. Photographer: Scott Dalton/Bloomberg Markets via Bloomberg A marker shows where the international border lies between San Diego, California and Tijuana, Mexico. Photographer: Scott Dalton/Bloomberg Markets via Bloomberg 
.
Just before sunset on April 10, 2006, a DC-9 jet landed at the international airport in the port city of Ciudad del Carmen, 500 miles east of Mexico City. As soldiers on the ground approached the plane, the crew tried to shoo them away, saying there was a dangerous oil leak. So the troops grew suspicious and searched the jet. 
Banks Financing Mexico Gangs Admitted in Wells Fargo Deal
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Comment #1 posted by Sam Adams on June 17, 2011 at 10:48:46 PT
the DEA and banks
oh yes, the banks would rather go back to laundering drug money in secret for much higher fees! Not hard to figure them out.
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