California Wrestles With How to Create a Banking System for Marijuana

LOS ANGELES (CN) — When California voted to legalize recreational marijuana, the state immediately faced a conundrum: how to provide banking services to marijuana businesses when federal law places the drug in the same category as heroin and cocaine.

Californians approved Proposition 64 In the November 2016 general election, voting to legalize commercial sale of cannabis for adult recreational use.

But like other states, California is struggling to solve the pressing issue of how a burgeoning marijuana industry can thrive if banks and financial institutions refuse to open their doors to them.

Cannabis businesses typically cannot open bank accounts because under the Controlled Substances Act the use, possession and sale of marijuana is a federal crime.

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