WASHINGTON: It’s official. Bank of America (BOA) takes no issue with accepting I-502 money from the State of Washington. Currently, BOA holds and manages the State’s main bank accounts. While the Feds have not given a green light to banks to allow for transparent banking in the cannabis industry, BOA seems confident that it won’t run into any issues in the future by virtue of only handling the State’s pot dollars.
Specifically, when asked about concerns over Federal asset forfeiture or legal action and enforcement, Washington State Treasurer, Jim McIntire, told The Olympian that he’s “not too worried about it,” and that “[i]t’s actually one of the advantages of having Bank of America as your contractor. It’s unlikely . . . that the federal government would raid them. And they’re big enough to look out for themselves on this.” If banks like BOA are too big too fail, hopefully they’re also too big to prosecute for taking State-sanctioned cannabis money.
As recently as this July, Liquor Control Board member Chris Marr said that, unless the Feds gave the official okay, no I-502 money could be deposited with other State funds without unlawful commingling. However, according to Assistant Washington State Treasurer, Wolfgang Opitz, BOA has “checked this out with their compliance department and they don’t see it as any different than say, medical marijuana or any other activity.” Even though we’re ecstatic to hear that a large bank is happy to accept cannabis profits, we find BOA’s laissez-faire attitude toward the issue hard to believe; it’s a well-known fact that banks refuse to openly do any business whatsoever with the cannabis industry because of Federal anti-money laundering laws.
So, we have to ask: does BOA’s newly-found tolerance for cannabis money stem from the recently released Cole memo? Is it based on the fact that BOA thinks it will have more security against the Feds with the I-502 market because that market will be heavily regulated and therefore less criminal activity will take place? Is it because BOA has been negotiating with the Feds in closed-door talks? Or is it because BOA is looking to infiltrate a new cutting edge market and just doesn’t care about the perceived risk?
Regardless of its reasons for taking Washington state money, the question is whether BOA will also bank with the cannabis industry at large. Whether the money is going into a State bank account or into that of a State-licensed retailer, it’s all cannabis money and it’s all still Federally illegal. In turn, if BOA is willing to bear the risk of accepting State cannabis funds, it shouldn’t take any issue with banking for I-502 licensees either (regardless of its motives).
We recently blogged about Rep. Denny Heck’s banking bill that would allow banks to do business with State-licensed cannabis operations without the threat of Federal prosecution. While there’s little chance that Heck’s bill will pass, BOA’s newly-developed policy on cannabis banking is encouraging because it indicates that banks might be willing to take the risk of managing cannabis stakeholder accounts without Congressional legislation on the issue. Hopefully, BOA’s willingness to take State pot money also extends to licensees, but only time will tell.