U.S. marijuana companies were expected to generate as much as $10bn in retail sales last year, a figure that is only going to increase as more states consider legalizing recreational marijuana.
But much of that money will go unbanked by financial institutions concerned about possible federal sanctions for servicing businesses considered illegal under federal law.
As of December 31, medical marijuana was legal in 33 states, while ten states had legalized the recreational use of cannabis.
“This is an unbanked industry,” said Dan Kim, assistant general counsel, global financial crimes legal with JP Morgan Chase. “Our position aligns with federal law.”
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