Page 12 - GS131001

News

Stars align for medical

marijuana sales

n a statement released in August 2013, the U.S.
Department of Justice said it will no longer pur-
sue prosecutions of marijuana dispensaries that
I operate in accordance with state laws and regula-
tions.

The decision, in the form of a memorandum to federal
prosecutors, came in the lead-up to a U.S. Senate
hearing in which department officials stated they are
working with the U.S. Department of the Treasury on
a plan that allows marijuana dispensaries to maintain
bank accounts. Senate Judiciary Committee Chairman
Sen. Patrick Leahy, D-Vt., called the hearing to examine
conflicts between state and federal marijuana laws.

To date, 21 states have legalized marijuana for medical
purposes; 16 of those also have decriminalized
possession of small amounts of pot. Washington and
Colorado were the latest to join the group, having
legalized the possession of small amounts of marijuana
and set in motion processes for state regulations that
address how pot is produced and distributed in those
states.

"These new laws are just the latest examples of the
growing tension between federal and state marijuana
laws, and they underscore the persistent uncertainty
about how such conflicts will be resolved," Sen. Leahy
said.

Backing away from prosecutions
Two years ago, the DOJ forced shut downs of several
marijuana dispensaries in California on grounds that
they violated federal law. That had a chilling effect
on relationships between dispensaries and financial
services companies. Banks have been refusing to open
accounts for marijuana dispensaries, as have merchant
services providers, fearing the federal government
would prosecute them for working with criminal
enterprises. As a result, many dispensaries operate as
cash-only businesses, even going so far as to pay taxes
and state licensing fees in cash.

In late August, the DOJ issued a memo instructing
federal prosecutors to de-prioritize enforcement of
marijuana laws against state-licensed dispensaries,
provided they are in compliance with state regulations.
And in response to questions posed by Sen. Leahy,
Deputy U.S. Attorney General James Cole said his
office is working with Treasury officials on the banking
conundrum, although he didn't elaborate.

12
12