DEA-DOJ Coordinationhigh
DOJ and DEA Issue Joint Memorandum on Cannabis Business Banking Compliance Expectations
Memorandum outlines minimum compliance expectations for financial institutions banking cannabis-related businesses; does not create safe harbor but signals enforcement tolerance parameters.
Announced: August 22, 2024
DEA Office: DEA Office of Diversion Control / DOJ Criminal Division
MarijuanaSchedule I
Summary
The Department of Justice and the Drug Enforcement Administration issued a joint memorandum in August 2024 addressing banking compliance expectations for financial institutions that choose to provide services to state-licensed cannabis businesses.
The memorandum does not create a legal safe harbor for banks providing cannabis banking services — such a safe harbor would require Congressional action. However, it articulates DOJ and DEA's minimum compliance expectations for institutions that elect to serve cannabis-related businesses (CRBs).
Key compliance expectations articulated in the memorandum include: (1) robust Bank Secrecy Act/Anti-Money Laundering (BSA/AML) programs specifically calibrated to CRB customer due diligence; (2) FinCEN Suspicious Activity Report (SAR) filing for all CRBs consistent with FinCEN's 2014 guidance; (3) enhanced due diligence protocols for CRBs operating near state-legal borders; and (4) transaction monitoring calibrated to cannabis-specific money laundering typologies.
The memorandum implicitly signals that DOJ and DEA will exercise prosecutorial restraint against financial institutions that comply with these expectations, consistent with the broader federal policy of not systematically prosecuting state-compliant cannabis activity.
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What Operators Should Do Now
For cannabis operators with banking relationships:
1. Request a copy of your bank's CRB compliance program and confirm that it addresses the four pillars in the joint memorandum. Your bank's program quality directly affects your account stability.
2. Provide proactive compliance documentation to your financial institutions: current state license, current operating permit, recent track-and-trace reports, and a compliance certification from your legal counsel.
3. Implement internal controls that make your transaction patterns legible to bank AML programs: consistent deposit patterns, detailed transaction descriptions, and documented reconciliation between sales records and deposits.
4. If you are located near a state border, anticipate enhanced monitoring from your financial institution and be prepared to demonstrate that your sales do not involve cross-border diversion.