In a recent interview, Stafford Fitzgerald Haney (former United States Ambassador to Costa Rica) was asked if he saw any contradictions with cannabis regulation and the role his country is having in the drug trade, still ongoing, in Latin America.
His response was predictable: “We have federal and state regulations, and on the federal level, marijuana is still completely illegal.”
To provide some context for the matter; the U.S government typically issues security “donations” throughout the continent. Nevertheless, and rather paradoxically, this hasn’t seen a rise in the regulation of drug production in Latin America, but it has in the States, where cannabis production is regulated since 2012.
To put it in simpler terms, the U.S drug production regulation is benefiting their government as well as their citizens, providing new tax dollars to fix roads and improve schools.
In Latin America, sadly, the death toll created by the “war on drugs” is increasing every day, and the federal prohibition withstanding (on a federal level) has only created roadblocks for Central American countries to find alternative solutions for their security issues (according to U.N stats, Central America is the region with the highest murder rate per person, on the entire planet).
The legal, and regulated, drug markets within the U.S have increased the number of cannabis or hemp related products brought to Latin America; however, anyone who produces, grows or elaborates these products for those specific export destinations have a higher probability of being arrested by the federal government.
These policies implemented by the United States have so much repercussion in Latin America that even the legal markets are in peril.
In Uruguay, for example, several banks have recently announced the shutdown of various accounts, which belong to pharmacies aligned with the distribution of state regulated marijuana (Uruguay is a pioneer in this area, legalizing cannabis back in 2014).
This act of retaliation is unprecedented, at least by a financial entity.
For example, Jorge Polgar, director of the Central Oriental Bank of Uruguay (BROU, because of its Spanish initials), announced that they will shut down said accounts, joining Scotiabank and Banco Santander (other independent, private banks) in the enforcement of this guideline.
As you probably guessed, the Uruguayan banks work under orders from their superiors in the U.S, which cannot profit from any assets involved with the distribution of a Schedule I controlled substance (in this case, marijuana).
¿Are the Banks acting as accomplices?
By taking a closer look at the Latin American proposals against money laundering and drug trafficking, you can see very little reforms to the financial system, as well as the loan platforms being used by criminal organizations to launder assets, like the infamous “drop by drop loans” and regular cash loans.
International financial entities have separated both issues, creating the archetypical narrative of “good guys” (them) versus the “bad guys”, this is ironic because the traditional banking system has a great deal of responsibility in money laundering, off shore Capitals and tax havens as it is.
In a way, this could be called economic terrorism and collaborating with felons.
Ever since the Uruguayan situation, isolated as it was, a proverbial distress signal has been activated; by operating this way, the U.S banks are letting independent pharmacies and legal cannabis distributors know that they prefer the traditional system, that allows drug trafficking as it always has been.
Senators from Colorado and California (where cannabis is legal) want to promote legislation that protects them from federal abandonment, now that the cannabis industry (booming as it is) could experience it, in a harsher manner, for years to come.
However, the question remains; would this proposed reform apply only to their home states, or could this be the beginning of a worldwide change?
For now, the former seems more likely than the latter.
Translation: Raúl Cabrera