If you’re keeping track of what so far has been the creeping acceptance and legalization of marijuana in the U.S., on Friday things took a huge leap forward.

The U.S. Treasury issued guidelines stating, in effect, that it’s legal for banks to provide financial services to marijuana-related businesses. That removes a huge impediment to the growth of the businesses, for up to now federal banking restrictions have forced them to operate in cash.

The Obama administration plainly recognizes that with the sale or use of marijuana now legal in some form in 20 states and the District of Columbia, the old restrictions are anachronistic. Worse, they foster crime: The essence of anti-money-laundering enforcement is to move business activity out of cash and into auditable, trackable transactions, such as bank and credit card accounts.

What we’re seeing is a fascinating example of how a long-standing social and legal norm starts to change. Think same-sex relationships and gay marriage. The impetus for change originates in a few states; they demonstrate that presumed consequences don’t follow, and the old norm yields to the new norm, first slowly and then at greater speed; and at some interim point the federal government -- whether through legislation, executive order or judicial directive -- adjusts to the new world and forces the last holdouts to join in.


Allowing marijuana businesses to get straight with the banking system is a key step along that continuum, though it represents less than total surrender. As my colleague Timothy M. Phelps reports, Friday’s guidance from the Treasury’s Financial Crimes Enforcement Network, or FinCEN, takes the liberalization of pot laws and regulations about as far as the administration thinks it can go. It’s not overturning federal drug law, which still defines marijuana as a controlled substance illegal to sell or distribute. It’s not endorsing the state initiatives.

But the Treasury is building on liberalized criminal guidelines issued last August by the Department of Justice. The DOJ similarly bowed to reality by relegating the pursuit of routine pot users and sellers to a very low priority. Instead, the DOJ listed its chief enforcement concerns as (among a few other things) preventing the sale of marijuana to minors, diverting revenue that goes to criminal enterprises or gangs and keeping pot trading from being used as a cover for the trafficking of harder drugs.

Pressure on the feds to lighten up has come particularly from the state governments of Colorado and Washington, which have gone further than any other states in legalizing marijuana. But the new guidelines still are freighted with the loopiness of America’s drug laws, which consistently have been applied more harshly in minority and poor communities than white and middle- or upper-class precincts.

Since marijuana isn’t being made legal in the eyes of federal law, it’s unclear whether banks, or which banks, will accept deposits or offer loans to marijuana-sellers, or whether you’ll be able to use Visa or MasterCard at your local dealerhip. For example, since pot is still technically illegal, banks will still be required to file “suspicious activity reports,” which identify transactions they think may be related to criminal activities, on any dealings with marijuana businesses.


They will be permitted to file “marijuana limited” suspicious activity reports, which state in effect that, yes, we know this is illegal, but it’s only marijuana. But they’ll also be expected to keep a lookout for red flags -- businesses that seem to be making a lot more money from marijuana than would be expected in their state, say, or a lot more than their competitors. In a way, marijuana businesses may end up with a lot more scrutiny from their bankers than they expected.

Yet as acceptance and legalization of marijuana spreads, today may be looked back on as a landmark moment: the birth of Ganja Inc.