This quote from the article is the crux of the issue. Even state public banks who knowingly accept proceeds from an illegal activity are guilty of money laundering (technically). Every bank or CU needs a federally issued master account in order to transfer money across institutions. Without this, you really don’t have a bank in the modern sense.
When Colorado tried to create a credit union for the marijuana industry there, “the Fed denied the credit union access to a master account, which is necessary for transferring money, and the National Credit Union Administration refused to insure its deposits,” the nonprofit Pew Charitable Trusts noted.
That’s some catch, that catch-22…It’s the best there is.
