In a letter to the heads of the financial regulatory agencies on Friday, the American Bankers Association called for greater clarification on how banks may serve businesses dealing with hemp—a low-THC strain of marijuana that was removed from the Controlled Substances Act by Congress as part of the 2018 Farm Bill.
Despite this legislative action, regulators have yet to issue a clear directive on distinguishing legal hemp and illegal marijuana, leaving many banks uncertain about whether they can legally serve these businesses, ABA noted. “Banks want to serve their communities and support their local economies but need clear, unequivocal assurance from their regulators that hemp is distinguishable from cannabis, and that serving the industry will not expose them to criminal and civil liability, or regulatory censure.”
ABA asked regulators to confirm that hemp is no longer considered a controlled substance and that banks do not need to file suspicious activity reports solely because a transaction relates to hemp or hemp-related products. The association also called for guidance on retail products containing hemp or hemp-derived CBD and the appropriate procedures for sourcing those products back to legal processors.