August 24, 2014

FinCEN: Marijuana-biz guidance working as it should

Aug. 13, 2014 – Suspicious activity reports filed between February and early August show there are currently 105 individual financial institutions engaged in banking relationships with marijuana-related businesses, Financial Crimes Enforcement Network Director Jennifer Shasky Calvery said in a speech Tuesday.

Shasky Calvery delivered remarks Tuesday at the 2014 Mid-Atlantic AML Conference, where she discussed today's challenges with combating money laundering. She also discussed the agency's guidance for those financial institutions serving marijuana-related businesses.

FinCEN guidance released in February says an institution handling monetary transactions for a marijuana business has to follow the same Bank Secrecy Act rules it follows in dealing with any other business. However, since marijuana businesses are legal only at the state level, a credit union or bank has to file a SAR each time it handles a transaction for one of them. Shasky Calvery noted during her remarks that the agency has received more than 1,000 SARs since the guidance was issued.

She said the "guidance is having the intended effect" and that it is "facilitating access to financial services, while ensuring that this activity is transparent and the funds are going into regulated financial institutions responsible for implementing appropriate AML [anti-money laundering] safeguards."

NAFCU says the guidance still doesn't address the legal issue of whether an institution is violating federal law in providing services to marijuana businesses.

Shasky Calvery will speak during NAFCU's Congressional Caucus, Sept. 9-12 in Washington. Registration is open for members and nonmembers.