Illinois State Treasurer Michael Frerichs recently announced in a press release that the Treasurer’s Office is working with lawmakers at the state and federal levels to bring clarity and predictability to Illinois banking regulations, to protect and support financial institutions that serve cannabis-related businesses, and to design solutions that will boost economic development in the state of Illinois.

“Today, we have a banking crisis because rules built decades ago have not kept up with changes in law and acceptable behavior,” Frerichs said. “Working together, we can use common sense to bring safety and security to this legal industry and everyone who lives in Illinois.”

According to the press release, as the state’s Chief Investment Officer and Chief Banking Officer, the Treasurer’s Office is responsible for receiving the revenues and all other public monies of the state. However, banks and credit unions are often not willing to provide financial services to cannabis-related businesses because cannabis is still illegal under federal law. Due to inconsistencies between federal and state laws, banks and credit unions in Illinois risk losing their assets, insurance, and licenses if they work with legitimate cannabis-related businesses authorized under Illinois state law.

This legal conflict has pushed Illinois’ legitimate cannabis industry primarily into a cash-based business. In 2018, there were an estimated $136 million in legal cannabis sales in Illinois alone. That much cash in any industry is ripe for theft, fraud, and tax evasion. By encouraging financial institutions to provide basic banking services to cannabis-related businesses, these businesses will be able to pay their taxes and fees transparently, comply with regulations, and thrive just like any other legal commercial enterprise.

“As State Treasurer, our office is working with lawmakers at the state and federal levels to bring clarity and predictability to our banking regulations, to protect and support financial institutions that serve cannabis-related businesses, and to design solutions that will boost economic development in the State of Illinois,” Frerichs said. To this end, the Treasurer’s Office has:

–Established banking services to collect taxes and fees from cannabis-related businesses on behalf of the state’s multiple agencies.

–Created the Community Invest–Cannabis Banking Services Program to support banks and credit unions in providing basic banking services to cannabis-related businesses.

–Introduced legislation to protect financial institutions in Illinois that provide services to cannabis-related businesses.

–Hosted Cannabis Banking Summits to bring industry players and experts together to help generate innovative solutions and form productive new partnerships.

–Contacted federal lawmakers to advocate for clarity and predictability in federal banking regulations.

–Co-authored a resolution before the National Association of State Treasurers to promote bipartisan solutions at the federal and state levels.

Read the rest of the press release here.

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