Despite protections remaining in place to keep the medical marijuana industry unscathed from the federal government’s crackdown, a bank in Illinois, which the cannabis industry has long relied on, pulled out.
Cannabis businesses in Illinois are left roiled after the Bank of Springfield, which they relied upon to process their money transactions has excused itself, the Chicago Tribune reported on Monday.
The Bank of Springfield informed cannabis clients last month it would close their accounts May 21, the Tribune reported.
A March letter obtained by the Tribune showed the bank had informed its cannabis clients in mid-January that it was reviewing its relationships with businesses in the industry.
The timing coincides with U.S. Attorney General Jeff Sessions move in early January to rescind an Obama-era policy, which allowed U.S. state where marijuana is legal, to operate freely without any federal government interference.
Marijuana on a federal level is prohibited.
But despite the reversal of the Obama-era policy, “protections remain to prohibit the department from spending federal money to prevent states from implementing medical marijuana laws,” the Tribune reported.
However, the bank’s spokesman Andrew Mack said those protections didn’t provide “enough comfort” to continue working with the industry.
“The bank’s stance is that protecting their customers is paramount,” he said.
“The Bank of Springfield will not jeopardize any of their customers by working with businesses that operate in the legal gray zone.”
The spokesman also said there was no “clarity” over the government’s intention.
“The trend had been toward more clarity, and that clarity has gone away.”
Mack declined to disclose how many clients Bank of Springfield worked with in Illinois’ medical marijuana industry.
This pressures businesses to deal mainly with cash.
In Colorado, the first U.S. state to legalize recreational marijuana in 2012, has some of its companies reportedly paying their bills with duffel bags full of cash.[share-btn]