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Expand chart
Adapted from a Financial Crimes Enforcement Network report; Chart: Axios Visuals

More banks and credit unions are offering checking and savings accounts, wire transfer services, and even loans to marijuana companies — and, so far, regulators have been watchful but accepting.

What's going on: Since marijuana is considered a criminal substance under federal law, banks that handle marijuana-linked money risk of being charged with money laundering. So they charge high fees for the privilege.

The Treasury Department's Financial Crimes Enforcement Network — FinCEN — tracks banks that serve what it calls MRBs (marijuana-related businesses).

  • Banks that do serve pot businesses — after completing due diligence to make sure a company isn't involved in illicit activity —must keep tabs on every single transaction and report customer activity to regulators.
  • Banks pass on the cost of all that paperwork — in theory, charging these customers whatever they want.
  • If a regulator says the bank isn't being thorough enough, fines can be levied.
  • Even so, there are still few options for marijuana companies that need a place to store cash, pay bills and so forth.

What we're hearing: "A cannabis operator can count on [paying] several thousand dollars a month in banking fees. It'd probably be in the hundreds of dollars for [a non-cannabis] company," Chris Call, CEO of North Bay Credit Union, which offers banking services for marijuana companies, tells Axios.

What to watch: The SAFE Banking Act — a bill in Congress that would shield banks from federal penalties for serving marijuana business customers — is gaining momentum. But in the meantime, states are trying to take matters into their own hands.

  • Nevada is testing a Venmo-like system that would allow marijuana businesses to transfer money.
  • California lawmakers are mulling a bill that would create state-sponsored, marijuana-friendly banks.

Higher taxes: Not only do marijuana companies pay higher banking fees, the illegality of marijuana means they pay more in federal taxes.

  • One tax regulation prevents most cannabis companies from deducting the business expenses that non-marijuana companies can.
  • One study found that the effective tax rate of MRBs was more than double the rate paid by “similarly situated” non-marijuana businesses.

Bonus: Cannabis companies don’t get a charitable deduction for any gifts they make. And charities are wary about accepting money from weed-affiliated businesses.

Go deeper:

Go deeper

Surprising pandemic side effect: Soaring trade deficits

Source: Census Bureau and Bureau of Economic Analysis; Chart: Axios Visuals

Inflation and jobs may get all the economic headlines, but meanwhile a big shift is taking place in the underpinnings of the world economy: The U.S. trade deficit is soaring.

What's happening: Americans' spending on imported physical goods has gone through the roof, while exports are growing slowly, making the U.S. the world's consumer of last resort.

Mike Allen, author of AM
2 hours ago - Politics & Policy

Third Way: "Big Lie" could become "Big Coup"

Graphic: Third Way

Third Way, the center-left think tank, is urging fellow Democrats to respond to the Capitol riot with "the size, scope, and seriousness of a presidential campaign," co-founder Matt Bennett tells me.

Driving the news: "For the first time in U.S. history, a party must mount two parallel presidential campaigns: one to win the election, and the other to prevent its theft," Bennett said, calling this "a Paul Revere moment."

Advocates say Biden has let Haitian migrants down

Photo illustration: Aïda Amer/Axios. Photos: Chip Somodevilla/Getty Images, Christian Torres/Anadolu Agency via Getty Images

Continued turmoil in Haiti is causing a growing number of Haitians to try to make it to American shores — and some advocates say the Biden administration isn't supporting this community in its time of crisis.

The big picture: Haitian-American activists in South Florida told Axios Today they feel like President Biden has gone back on campaign promises he made to the community to stand up for them.

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