Great news: on March 7, 2019, the “Secure and Fair Enforcement Banking Act of 2019” (or, the “SAFE Banking Act”) was officially introduced in the House of Representatives. Even greater news: championed by Representatives Ed Perlmutter (D-CO) and Denny Heck (D-WA), the SAFE Banking Act reached the House with a bipartisan alliance of 106 co-sponsors – meaning a quarter of the House recognizes that state-legal, marijuana-related businesses need to be able to engage with banks and other financial institutions, and vice versa.
As discussed in this earlier blog post, the SAFE Banking Act aims to prohibit federal regulators from punishing banks and other financial institutions that provide banking services to state-legal marijuana businesses, marijuana-related businesses, and their owners and employees. This includes preventing federal banking regulators from limiting a depository institution’s access to the Deposit Insurance Fund and taking action on loans made to marijuana businesses.
At the time of its introduction, Representative Perlmutter re-emphasized that the legislation was primarily aimed at safety – “The SAFE Banking Act is focused solely on taking cash off the streets and making our communities safer. Only Congress can provide the certainty financial institutions need to start banking legitimate marijuana businesses – just like any other legal business – and reduce risks for employees, businesses and communities across the country.”
Representative Heck went on to elaborate: “We know based on the Treasury guidance that the federal government prioritizes keeping this product out of the hands of children and organized crime. The most effective way to do that is to not only allow, but encourage these businesses to use traditional banking methods to track their sales, deposits, expenses, tax payments, and other business transactions. If Congress fails to act, we are discouraging responsible, regulated markets and allowing a serious public safety threat to go unaddressed.”
In case you need a refresher, the SAFE Banking Act needs to pass the House by a simple majority (218 of 435) to reach the Senate. While it’s a long way off from becoming law, the SAFE Banking Act is certainly off to a much better start than all its predecessors. Stay tuned.