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Senate Marijuana Hearing Raises Hopes, Concerns

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By Brett Snider, Esq. on September 13, 2013 9:23 AM

A Senate hearing on the merits of state-legalized pot was held by the Judiciary Committee on Tuesday, focusing primiarly on the conflict between federal and state laws.

The hearing was prompted by the Justice Department's announcement that it would back off on prosecuting "legal" marijuana possession and use in states like Colorado and Washington, where voters have approved non-medicinal marijuana use for adults over 21. The DOJ says it's focusing instead on areas which are illegal under both state and federal law (e.g., the sale of marijuana to minors).

According to USA Today, this change in policy was what led Sen. Patrick Leahy (D-Vermont) to request a hearing, questioning whether "federal prosecutions of marijuana users are the best use of taxpayer dollars."

Enforcing Federal Law in 'Legalized' States

Although Colorado and Washington are currently the only two states that have legalized recreational possession and use of marijuana, 20 states and Washington, D.C., have approved pot for medical use.

The DOJ made a similar proclamation about not prosecuting medical marijuana users who complied with state laws in 2009, although marijuana in all forms remains illegal under federal law.

So if the DOJ doesn't mind looking the other way, what's the problem?

Enter Sen. Chuck Grassley (R-Iowa) who, according to the Associated Press, reminded committee members that the DOJ is essentially "giving the green light" to a cannabis industry that is entirely illegal under federal law.

The Los Angeles Times reports that Grassley supported his argument by citing problems with marijuana pouring over into states where it is illegal, like Iowa. He called into question the effectiveness of state governments to regulate recreational or even medicinal pot.

Pot Business Banking Issues

Even for those who support the continuation of state legalization programs, there are logistical problems that need to be worked out.

Specifically, banks are unavailable to marijuana business owners, since these financial institutions were warned by Deputy Attorney General James Cole to avoid "engag[ing] in transactions," the AP reports. Pot retailers could potentially face money laundering and other federal charges.

Without access to banks, marijuana-based businesses are doomed to be cash-only, with legal dispensaries fearful of not only DEA raids but also criminal elements gunning for their hard-earned cash.

As more states consider changing their marijuana laws, federal barriers to successful implementation of those laws may start to bend.

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