When the Justice Department abruptly announced its revocation of the Cole Memo — the set of federal guidelines that allowed the legal marijuana industry to operate at the state level despite its status as an illegal Schedule 1 narcotic — it neglected to contact the team at FinCEN (Financial Crimes Enforcement Network), the branch of the Treasury Department that had heretofore been tasked with overseeing financial services regulation for the legal(ish) cannabis industry.
Caught flat-footed, the agency reports having spent the time since the big news responding to the wave of phone calls from both constituents and congressional offices with questions about what happens now.
Except FinCEN reportedly has no idea what happens now — because they found out about the Justice Department’s decision exactly when everyone else did, and thus has not really calibrated its policies to the new order.
The Justice Department has declined to comment about whether it had coordinated with FinCEN in advance.
Today around 400 banks and credit unions do business with the U.S. marijuana industry.
“I imagine that Sessions did not even contemplate that his action could trigger potentially billions of dollars of cash from being unbanked,” said Saphira Galoob, whose firm, The Liaison Group, lobbies on behalf of cannabis clients.
And indeed, the Justice Department made no mention of the banking guidance issued in tandem with the Cole Memo by FinCEN in February 2014 that offered banks a framework for how to offer legal financial services to the industry in states where it is legal.
And, for now, the guidance remains in place.
Stephen Hudak, a FinCEN spokesman, said as much in a public statement — despite the Justice Department’s actions.