Federal Agency Smack Down on a Michigan Credit Union’s Cannabis Banking

KLAW Blog · March 26

Apple to Apples

An independent federal agency has recently cited a Michigan credit union for non-compliance with regulations regarding banking services for the marijuana industry. Consequently, the financial institution has been directed to halt the opening of new cannabis accounts.

The National Credit Union Administration’s cease-and-desist order emphasizes the need for financial institutions to maintain compliance when providing services to marijuana businesses.

Attorney Michael Komorn

State / Federal Legal Defense

With extensive experience in criminal legal defense since 1993 from pre-arrest, District, Circuit, Appeals, Supreme and the Federal court systems.

KOMORN LAW (248) 357-2550

The Financial Crimes Enforcement Network (FinCEN), a division of the U.S. Treasury, has issued regulations to financial institutions regarding the surveillance and reporting of suspicious activities, including potential money laundering.

The credit union had a manual system, which resulted in the late filing or missed suspicious activity reports.

But what about this –> Cannabis cash transactions aren’t suspicious says IRS

According to the order the credit union waived its right to appeal and agreed to take the following steps:

Immediately cease opening new marijuana accounts and suspend transactional activity on certain existing accounts. Implement an automated system to effectively monitor, identify and file suspicious activity reports in accordance with FinCEN regulations. Engage a third party to validate compliance.

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