Thursday, February 6, 2014

Foibles of Federalism; The Legal/Illegal Environment of Cannibus

Marijuana is now either legalized, legalized for medical use or decriminalized by state law in nearly one-half of the United States. However, it is still illegal under federal law. The US Supreme Court determined in Gonzales v. Raich that the powers granted the federal government in the Commerce Clause support federal legislative authority to act. The years since that case have seen troughs and peaks of federal enforcement, promises not to enforce and those promises broken.  Now as businesses begin the  task of selling marijuana under state law, they discover that banks are unwilling to handle their money. Fearful of running afoul of federal law and facing disciplinary action or worse, federally licensed banks are refusing to handle marijuana money that is legally obtained under state law but are illegal proceeds of a crime under federal law. The DOJ recently promised to give banks guidance on how to legally handle this money without risking enforcement action. Banks are skeptical. These are the kinds of policy promises that have been broken before and, of course, are non-binding on future administrations who can prosecute past actions.  So it looks like marijuana dispensary entrepreneurs will be burying a lot of cash in coffee cans in their backyards.  The more things change . . .

Warning: This video includes the word "f**k"

Is this how legal recreational use of marijuana will affect businesses?

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