American Express Nixes Purchase Of Medical Marijuana
by Ilana Greene, May 23, 2011
Starting April 30th, consumers using their American Express cards to buy medical marijuana received notice that their cards were declined. The rejection of the cards is due to American Express' decision to no longer allow purchases of such products with their cards. American Express made this move despite the fact that the purchase of medical marijuana is legal in 15 states.
So far, American Express has given no reason for the new rule, leaving medical marijuana dispensaries and their customers guessing at possible causes. One theory is that the card issuer has received complaints from companies about their employees using their American Express cards to purchase medical marijuana. American Express may also have received a high number of fraudulent or unauthorized charges from medical marijuana dispensaries due to people using forged or stolen cards to obtain pot.
While legal marijuana may be used for illegal purposes, a lot of sick patients need the drug. Many would argue that American Express’ move is an audacious one, wondering how the company can overrule a practice that 15 states have made legal.
Visa, Discover and MasterCard have not established similar policies. Only time will tell if the companies will follow suit, leaving medical marijuana dispensaries as cash and check only enterprises.