The Secure and Fair Enforcement (SAFE) Banking Act was recently introduced to Congress. If passed successfully, the bill would effectively allow federal banks to accept revenue from businesses profiting from the sales of cannabis.
The bill was reintroduced by Representatives Denny Heck (D-WA) and Ed Perlmutter (D-CO), although over a third of the House actually cosponsored the legislation.
Last week, the House and Financial Services Committee voted 45 to 15 in favor of moving the legislation forward for a vote.
This comes after a hearing back in February in front of the Subcommittee on Consumer Protection and Financial Institutions. At this hearing, cannabis retailers, the banking industry and law enforcement representatives all gave testimony in support of allowing the cannabis industry to participate in the federal banking system.
Medical cannabis is now legal in 31 states (and the District of Columbia). Recreational marijuana is broadly legal in 9 of those states. Despite legalization, however, many federal institutions have been reluctant to accept funds from businesses involved in the cannabis industry, forcing those businesses to operate on cash alone, a prime opportunity for those with criminal intent.
The bill’s passage would not only eliminate a potentially dangerous aspect of the legal cannabis industry; this issue itself is also a criminal rights issue. According to Chairwoman Maxine Waters (D-CA), “I also consider this bill as part of a holistic approach toward providing criminal justice reform to those who have been harmed by the criminalization of marijuana and should not by any means be the only bill the House takes up on the important issue of cannabis reform.”
Other legislators are not as enthusiastic about the SAFE Banking Act. Said Representative Patrick McHenry (R-NC), “Some on my side support the measure as written. Many oppose it. Most important for this committee, we need to ensure that we’re doing our due diligence before proceeding. One committee hearing is not enough to fully understand the consequence of this bill. It is a massive change in federal policy.”
According to the National Organization for the Reform of Marijuana Laws (NORML), one of the largest nonprofits working to end marijuana prohibition in the United States, passage of the SAFE Banking Act is a crucial step towards ensuring that those engaged in the legal cannabis industry can operate “safely, transparently, or effectively,” all of which are made impossible “without access to banks or other financial institutions…Currently, hundreds of licensed and regulated businesses do not have access to the banking industry and are unable to accept credit cards, deposit revenues, or write checks to meet payroll or pay taxes.”
Similar bills have previously failed to pass, including S. 1152, of the same name, back in 2017.
National Cannabis Industry Association spokesperson, Morgan Fox, had this to say: “this hearing was extremely positive and bodes well for the SAFE Banking Act in the current legislative session. Testimony from supporters was wide-ranging and powerful, and the only arguments heard against sensible banking reform consisted of disproved ‘gateway’ nonsense and jurisdictional arguments, neither of which had anything to do with banking.”