US Senators introduced legislation on Wednesday to ensure that legal cannabis businesses can access banking services.
The Secure and Fair Enforcement (SAFE) Banking Act of 2017 would solve a key logistical and public safety problem in states that have legalized medicinal or recreational cannabis, according to the Senators. Oregon Democrat Senator Jeff Merkley led a bipartisan group of Senators – including Senator Cory Gardner (R-CO), Senator Ron Wyden (D-OR), Senator Rand Paul (R-KY), Senator Michael Bennet (D-CO), Senator Patty Murray (D-WA), Senator Elizabeth Warren (D-MA), Senator Catherine Cortez Masto (D-NV) and Senator Brian Schatz (D-HI) in introducing the legislation.
Currently, cannabis businesses operating under state laws that have legalized medicinal or recreational cannabis have been mostly denied access to the banking system because banks that provide them services can be prosecuted under federal law. Without the ability to access bank accounts, accept credit cards, or write checks, businesses must operate using large amounts of cash. This creates safety risks for businesses and surrounding communities, and makes it more difficult for local and state governments to collect taxes“Forcing legal businesses to operate in all cash is an invitation to money laundering and robbery,” said Merkley. “It’s absurd that cannabis business owners in Oregon have to shuttle around gym bags full of cash to pay their taxes or compensate their employees. This is a public safety issue, and rather than making it even harder for banks to serve these legal businesses, President Trump and Attorney General Sessions should work with us to end this unnecessary risk for communities across America.”
“Conflicting federal and state marijuana laws make it difficult for legitimate businesses to use the basic financial services they need access to and this bipartisan legislation gives them that access they need,” said Senator Gardner. “We must also take into account the risk to public safety as these businesses are being forced to carry around bags of money to pay for their employees and rent. Legal businesses should not be treated like this, and I’m glad that Republicans and Democrats are working together to address this issue.”
“Oregon legalized marijuana use for adults three years ago, yet outdated regulations leave law-abiding individuals and business owners in our state facing unequal treatment in the eyes of the federal government,” said Wyden. “The bottom line is, legal businesses in Oregon and other states should not be unjustly relegated to lugging around sacks full of cash like thieves in the night. This bill would respect the will of voters in Oregon and all the states that have legalized marijuana by lifting federal penalties defended by so-called states’ rights proponents that block marijuana businesses from going to the bank just like every other legal business.”
“The lack of access to banking services for marijuana businesses is a key issue in Colorado,” Bennet said. “It raises significant public safety concerns for both employees and customers of these businesses and creates compliance and oversight challenges. This common-sense bill would address those issues by allowing our banking system to serve marijuana businesses that are in compliance with state laws.”
“This legislation is about certainty, safety, and economic growth. Banks, credit unions and small business owners in Washington state and across the country that are licensed to participate in legal business ventures should not be treated differently and shut out from participating fully in the economy,” said Senator Murray. “As a voice for Washington state voters in Congress, I am going to keep working to give entrepreneurs and lenders the clarity and security they need to grow and to create safer conditions for legitimate businesses to thrive.”
“Forcing legitimate marijuana businesses to operate a cash-only business is dangerous. It creates unnecessary public safety issues for communities and business owners,” Warren said. “The SAFE Banking Act is a common sense bill that would advance state efforts to regulate the sale of marijuana and support businesses working to establish reliable business operations.”
“We need to put the right infrastructure in place for the marijuana industry to operate legally and securely,” Cortez Masto said. “Allowing lawful cannabis-related businesses access to the mainstream banking system will alleviate security concerns and create more regulatory certainty for Nevada dispensaries and related providers, as well as the banking system. This bill will give our economy a boost by letting local businesses thrive and will also aid in the economic development of Nevada tribes.”
The bill would prevent federal banking regulators from:
- Prohibiting, penalizing or discouraging a bank from providing financial services to a legitimate state-sanctioned and regulated cannabis business, or an associated business (such as an lawyer or landlord providing services to a legal cannabis business);
- Terminating or limiting a bank’s federal deposit insurance solely because the bank is providing services to a state-sanctioned cannabis business or associated business;
- Recommending or incentivizing a bank to halt or downgrade providing any kind of banking services to these businesses; or
- Taking any action on a loan to an owner or operator of a cannabis-related business.
The bill also creates a safe harbor from criminal prosecution and liability and asset forfeiture for banks and their officers and employees who provide financial services to legitimate, state-sanctioned cannabis businesses, while maintaining banks’ right to choose not to offer those services.
The bill would require banks to comply with current Financial Crimes Enforcement Network (FinCEN) guidance, while at the same time allowing FinCEN guidance to be streamlined over time as states and the federal government adapt to legalized medicinal and recreational cannabis policies.