Sorry Colorado and Washington, You Still Can't Buy Pot With a Credit Card
In the future, consumers will be able to log onto a website like Seamless or Grubhub, and, with a credit card and a couple of clicks, arrange for someone to bring them a pan of gourmet pot brownies or a box of bubble hash. In the present, not even medical marijuana patients can use credit cards to buy pot.
While the Justice Department announced in late August that it would allow Washington and Colorado to tax and regulate recreational marijuana, credit card companies won’t be party to any pot-related transactions:
American Express and the banks through which most of us acquire our credit cards, generally refuse to do business with marijuana marketers or to authorize credit card transactions that involve cannabis.
American Express told CreditCards.com that it does not anticipate softening its current ban and will not authorize such sales, even in the wake of Holder's announcement.
The reason? Despite the change in federal enforcement policy regarding pot, the federal Controlled Substances Act still outlaws the production and selling of the substance.
"AmEx has made a decision to not allow card acceptance for medical marijuana," said Sanette Chao, a spokeswoman for American Express. "It is our policy to continue to adhere to federal law in such matters."
American Express’s decision might seem a little obtuse, but it's sensible from a CYA perspective. The ceasefire between the Justice Department and marijuana businesses hinges on states effectively regulating pot production and sales, but also on a number of factors beyond states' control. The feds have promised to revert to their old ways if state-legal marijuana is trafficked to states where it’s still illegal, if teen use increases, and/or if states experience an increase in drugged driving. The circumstances under which the ceasefire may collapse, in other words, are as varied as they are vague.
And here’s another thing: Unless the Controlled Substances Act is amended to exclude marijuana from federal law (or, to make it legal at the federal level), the DOJ’s pot policy will essentially expire in 2016. A new president will bring a new attorney general, and (possibly) a renewed antagonism toward state-legal marijuana.
Representative Ed Perlmutter of Colorado would like his colleagues to “provide financial institutions certainty they can make their own business decisions related to legal, financial transactions without fear of regulatory penalties.” But until Congress actually provides that certainty, you can’t blame credit card companies for their reluctance.