NCUA releases additional guidance to credit unions serving hemp businesses
Recently, the NCUA released updated guidance to federally insured credit unions on serving hemp businesses. As previously covered by InfoBytes, in August 2019, NCUA released interim guidance allowing federally insured credit unions to service hemp businesses. The guidance explained that the Agriculture Improvement Act of 2018 (2018 Farm Bill) removed hemp from Schedule I of the Controlled Substances Act, but noted that hemp could not be produced lawfully under federal law, beyond a 2014 pilot program, until the USDA promulgated regulations and guidelines to implement the hemp production provisions of the 2018 Farm Bill. In October 2019, the USDA issued an interim final rule, which outlined provisions to approve plans submitted by state or Native American tribes that want to retain primary regulatory authority over the production of hemp and a federal licensing plan for producers in states and tribal territories that do not have their own USDA-approved plans.
The newly released guidance reminds credit unions to stay current with the federal, state, and Native American tribal laws and regulations that apply to any hemp-related businesses, as the interim final rule does not preempt or limit any law state or tribal law that that is more stringent than the 2018 Farm Bill. Among other things, the guidance notes that NCUA examiners will collect data concerning the types of services credit unions are providing to hemp-related businesses and states that the NCUA expects credit unions to employ sufficient customer due diligence procedures as part of their BSA/AML compliance program to ensure hemp growers possess a valid state or USDA license.