Grassley blasts Obama weed memo

Grassley blasts Obama weed memo
© Greg Nash

Sen. Charles GrassleyCharles (Chuck) Ernest GrassleyCriminal justice groups offer support for Durbin amid fight for Judiciary spot Capitol physician advises lawmakers against attending dinners, receptions during COVID-19 spike Congress ends its year under shadow of COVID-19 MORE (R-Iowa) says the Treasury Department is overstepping its bounds with a memo outlining how banks can provide services for businesses selling marijuana.

Grassley, the top Republican on the Senate Judiciary Committee, said it’s illegal for banks to deal with marijuana sale proceeds, and that only Congress can change those laws.

“The administration can’t change the law with a memo,” he said in a statement released late on Friday. “While the Justice Department’s memo tries to guide prosecutorial discretion, that discretion shouldn’t be used to facilitate illegal conduct.”


Grassley said the Justice Department was encouraging an “improper use of prosecutorial discretion,” and tied it to the more general GOP criticism that the administration is seeking to do too much with executive authority.

“This is just one more area in which the Obama administration is undermining our system of checks and balances and the rule of law,” he said. 

Marijuana is officially a Schedule 1 substance in the eyes of the federal government, but medical pot is legal in 20 states and the District of Columbia. In Colorado and Washington, it is legal to buy, sell and use marijuana for recreational purposes.

The Obama administration has taken a hands-off approach to those state laws, and pledged not to interfere. Last summer, the Justice Department issued a memo advising prosecutors to prioritize keeping childen safe and other goals, instead of cracking down on low-level drug busts. 

Still, banks have been reluctant to get involved with marijuana dispensaries and other businesses. They have expressed concern that serving those companies could open them up to federal prosecution for money laundering.

On Friday, the Treasury Department issued guidelines allowing banks to do business with companies that sell marijuana, so long as they make sure that the businesses have the proper state licenses. 

Under the guidelines, banks are also told to watch out for suspicious behavior such as a business owners’ inability to show the correct paperwork or “cash that smells like marijuana” from someone trying to hide their weed business.  

President Obama has admitted that he personally smoked pot as a kid and said in a recent interview that the drug was akin to smoking cigarettes.