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Banking Groups Urge Senate to Move on Cannabis Financing Reform Bill

September 18, 2019, 09:00 AM
Filed Under: Cannabis

The Independent Community Bankers of America (ICBA) and 43 state banking associations wrote to House Congressional leadership urging them to move swiftly to schedule floor consideration of the Secure and Fair Enforcement Banking Act of 2019 (SAFE Banking Act, H.R. 1595). The SAFE Banking Act would create a safe harbor for financial institutions that serve cannabis-related businesses (CRBs) and ancillary businesses that serve them in states where cannabis is legal.

The current conflict between state and federal law has created increasingly “significant legal and compliance concerns” for banks, which has led to “curtailed access to the traditional banking system for CRBs and forced them to operate mostly in cash,” the organizations wrote.

A safe harbor would extend to providing banking services to many ancillary businesses as well, such as landlords, accountants and utilities providers that serve CRBs in states where cannabis is legal and may be difficult to identify. It would also avoid a legal and regulatory conundrum for even those banks that choose not to serve CRBs directly, the letter continues.

Notably, ICBA was the first national banking trade association to support the SAFE Banking Act and joins its 43 state affiliates urging Congress to act expeditiously to advance this critical legislation as soon as possible.

On Monday, the Senate version of the marijuana financial services bill got its 33rd cosponsor—Sen. Tina Smith (D-MN)—meaning that virtually a third of the chamber is now formally signed onto the legislation, counting its main sponsor Sen. Jeff Merkley (D-OR), according to Forbes.

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