Regulators are giving banks the go-ahead to do business with hemp growers and cultivators, however marijuana is still a controlled substance under federal law.
Banks are no longer required to file suspicious activity reports (SAR) for customers solely because they grow or cultivate hemp, said the Federal Reserve, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Financial Crimes Enforcement Network (FinCEN) and the Conference of State Bank Supervisors in a joint statement (no pun intended) today.
The banks are being told to do business with hemp growers and cultivators they must have a Bank Secrecy Act/Anti Money Laundering compliance program.
“When deciding to serve hemp-related businesses, banks must comply with applicable regulatory requirements for customer identification, suspicious activity reporting, currency transaction reporting, and risk-based customer due diligence, including the collection of beneficial ownership information for legal entity customers,” the federal and state regulators said.
The statement noted hemp may be grown only with a valid U.S. Department of Agriculture-issued license or under a USDA-approved state or tribal plan.
However, a state or tribal government may prohibit the production of hemp, even though it is legal under federal law.
FinCEN will be issuing additional guidance on a proposed USDA interim rule regarding hemp.
The interim rule, issued October 31, says state departments of agriculture and tribal governments may submit plans for monitoring and regulating the domestic production of hemp to the USDA for approval.
It also establishes a federal licensing plan for regulating hemp producers in states and tribal territories that do not have their own USDA-approved plans
To see the full, 3-page statement click on: