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SAFE Banking Act Addressing Cannabis Banking Introduced In Congress

March 7, 2019 5:05 pm
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Congress is poised to consider legislation that would give cannabis companies access to banking. The Secure and Fair Enforcement (SAFE) Banking Act of 2019 was introduced Thursday following a hearing held last month.

What Happened

The bill was authored by Rep. Ed Perlmutter, a Democrat from Colorado, and Rep. Denny Heck, a Democrat from Washington, and cosponsored by Rep. Warren Davidson and Rep. Steve Stivers, both Republicans from Ohio.

The SAFE Banking Act of 2019 aims "to create protections for depository institutions that provide financial services to cannabis-related legitimate businesses and service providers for such businesses, and for other purposes."

The bipartisan bill comes after the Subcommittee on Consumer Protection and Financial Institutions held a Feb. 13 hearing where a number of experts, including the California state treasurer; representatives of law enforcement, credit unions and banks; and a licensed medical cannabis producer and retailer from the District of Columbia gave supportive testimony.

The National Cannabis Industry Association submitted written testimony and stories from some 100 cannabis industry professionals that outlined the burdens and safety concerns created by the banking situation.

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"The SAFE Banking Act has been one of NCIA's biggest legislative priorities for some time, and the sheer number of bipartisan cosponsors of this bill on introduction is a great sign that those efforts are bearing fruit. This level of support suggests that cannabis banking reform stands a serious chance of passing in the current session," NCIA spokesman Morgan Fox told Benzinga.

Why It's Important

Given that most U.S. states have legalized marijuana in some form, a bill that gives businesses access to banking services despite the federal illegality of cannabis is a necessary step.

Perlmutter and Heck have introduced similar bills in every Congress since 2013. The latest bill also includes protection for ancillary businesses, such as real estate owners, accountants and other service providers that don't work directly with the plant.

Compared to other legislation introduced in Congress to address cannabis and banking, such as the STATES Act, the SAFE Banking Act of 2019 is the only bill that would prohibit federal banking regulators from taking action against financial institutions.

The SAFE Banking Act of 2019 has overwhelming bipartisan support with 106 cosponsors at the time of introduction.

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