Yesterday, the House Financial Services Committee approved the Secure and Fair Enforcement (SAFE) Banking Act that will allow federally insured banks to work with licensed cannabis businesses. The vote was heavily in favor of approving the bill and it won with a landslide 45-15 victory.
As the first piece of major marijuana reform to pass committee at the federal level, the SAFE Banking Bill would be transformative for the cannabis industry if it were to become law. While there has been no official date set for a full House floor vote, it is expected in the coming weeks.
House Rules Committee Chairman James McGovern recently stated that, “We will guide it to the House floor for a vote, which I think it will pass with an overwhelming vote—Democrats and I think a lot of Republicans as well. If we have a strong bipartisan vote that will increase the pressure on the Senate to do something.”
The SAFE Banking Act is long overdue as improving safety and easing business transactions for a predominantly cash-only cannabis industry is now imperative. It would provide protection to financial institutions from prosecution by federal banking regulators just because they offer services to marijuana businesses that are legal under state law.
House Financial Services Chairwoman, Maxine Waters, notes that the SAFE Banking bill. "addresses an urgent public safety concern for legitimate businesses that currently have no recourse but to operate with just cash." She is not the only one on Capitol Hill who is encouraged by the progress of cannabis reform.
Founder of the Congressional Cannabis Caucus, Representative Earl Blumenauer went on to say, “I applaud the outstanding work of Chairwoman Waters and Representatives Heck and Perlmutter for making this possible. The SAFE Banking Act solves a major problem for the state legal cannabis industry and its success moving through the committee is a signal of how we can move forward with other critical proposals.”
Currently there are a few renegade banks who have been brave enough to provide marijuana dispensaries with checking accounts but these are few and far between. With state policy constantly evolving most financial institutions are reluctant to work with cannabis businesses in fear of violating federal money laundering or drug laws.
The House Financial Services Committee twitter account made it clear they support this change.
Legally-authorized cannabis businesses are forced to operate w/ cash only, which sometimes makes them targets for violent criminals. #HR1595, the #SAFEBankingAct will address this issue by creating a safe harbor that allows banks & credit unions to provide services to these biz.
— Financial Svcs Cmte (@FSCDems) March 27, 2019
One of the best traits of the SAFE Banking Bill is that it will mandate a study by the Government Accountability Office "on the barriers to marketplace entry, including in the licensing process, and the access to financial services for potential and existing minority-owned and women-owned cannabis-related legitimate businesses." This will help identify issues in the licensing process and help social equity businesses secure financial support.
This legislation making it through committee signifies that lawmakers on both sides of the aisle recognize the importance of having financial services available to the cannabis industry. If it makes through the House with a strong vote, the Senate is more likely to agree, however it does face an uphill battle in the Republican controlled Senate. Executive director of the Marijuana Policy Project, Steve Hawkins noted that, "Regardless of where members stand on legalization, they can agree that it is in the public interest to make banking available to cannabis businesses in states where it is legal."