Biden admin to candidates: Maybe don’t invest in cannabis companies

The recently updated guidelines are the latest illustration of the federal government trying to grapple with its cannabis-related human resource policies as the product has become an accepted legal business, drug, and recreational substance in states across the country. A total of 37 states, the District of Columbia and some territories have legalized cannabis for medical or recreational use.

The White House has taken a more lenient stance than its predecessors. Early in his term, President Joe Biden issued a memo saying that prior marijuana use would not automatically disqualify candidates — the most lenient policy of any administration since before President Ronald Reagan.

But he was not entirely forgiving. Last year, the White House fired some employees and rescinded job offers over prior marijuana use early in the administration. According to the internal presentation, the White House has not changed its position, despite calls from House Democrats to do so.

The growth of the weed industry presented additional complications. The new “clarifying guidance” was presented in a memo to agency heads in December by Avril Haines, the director of national intelligence, as GovExec reported in January. The presentation noted that any marijuana-related investment “through a publicly traded diversified mutual fund in the United States” should be presumed to have been made unintentionally. At the same time, the presentation ended with a warning graphic stating: “NOT KNOWING IS NO EXCUSE”. The new guidelines also state that “disinvestment or decoupling from deliberate and direct investment in such activities should be considered a mitigating factor.”

As the guidelines have made their way through the sprawling executive branch, they have annoyed some in the Biden administration who think the rules are outdated.

A thorough review of marijuana investments is not new to the federal government. Under the Trump administration, the United States banned certain Canadian citizens from entering the country to invest or plan to invest directly in marijuana businesses. Private investment is the main source of capital for the marijuana industry, as it largely lacks access to bank loans due to its federal illegality.

What is unclear, however, are the marijuana stocks the White House is referring to. US marijuana companies are not traded on US exchanges, as they are not federally legal companies. Instead, US-based marijuana companies trade on the Canadian Securities Exchange, a lower-tier exchange in a country where cannabis is federally legal. All cannabis companies traded on US exchanges only sell legal CBD products or manufacture and sell marijuana in a country where it is federally legal, such as Canada. The White House and the Office of the Director of National Intelligence declined to clarify that language.

As such, the release of the new guidelines could suggest that the White House is gearing up to continue normalizing the cannabis trade and is seeking to ensure that there are no conflicts of interest if the government federal government begins the complex process. additional regulations.

Asked about the new policy, an ODNI spokesperson told POLITICO that “increased legalization of marijuana use at the state and local levels has raised questions about how the federal government is dealing with the involvement of an individual with marijuana”. The spokesperson added, “The December 21, 2021 memo … provides clarifying guidance to federal agencies responsible for determining this eligibility.”

By modernizing their language, however, the White House risks sending mixed messages. The guidelines say that not knowing the rules is “no excuse”, but also that arbitrators must “consider whether a person knowingly facilitates violations of the Controlled Substances Act”.

Cannabis activists have often called Biden “late” on cannabis policy. Sixty-eight percent of all Americans — including 83 percent of Democrats — support federal marijuana legalization, according to Gallup. But in 2020, Biden did not join his main Democratic challengers in pledging to legalize marijuana nationwide, simply saying no one should be in jail for using marijuana and promising to return research on the medical marijuana easier to conduct.


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