Federal and state bank regulators announced Tuesday that they were scrapping a burdensome requirement that banks said kept them away from the hemp business, The New York Times reports. Banks will no longer have to treat their hemp customers as suspicious and file reams of paperwork to anti-money-laundering authorities for each interaction.
Hemp products are made from the same plants that produce marijuana, but they are cultivated to have far less of the chemical that produces a “high” when ingested. The plants’ stalks can be woven into fabric and their seeds processed into oils used in food, but they cannot be made into drugs.
Federal law long considered hemp to be as forbidden as cocaine and heroin. But with the legalization of marijuana spreading across the country—33 states, including Louisiana, have legalized the drug for medical use and 11 states will allow sales for recreational use by January—lawmakers in Washington decided to do away with the designation for its milder sibling.
The step forward for banking could signal a positive step for the tangentially related medical marijuana industry as well, which has struggled to find banking options in Louisiana as growers and pharmacies began to produce and provide the products to patients over the past year.
Read a Business Report story on the medical marijuana banking situation, and The New York Times story here.
