Category: SAFE Banking Act

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U.S. House Approves SAFE Banking Act as Part of Military Spending Bill in Historic Vote

terry roston

The U.S. House approved the Secure and Fair Enforcement (SAFE) Banking Act on Thursday in a bipartisan 316-113 vote as part of the latest National Defense Authorization Act, a military spending bill. It’s the fifth time the legislation has been approved in the House as a standalone bill or an amendment as part of larger legislation.

Since statewide cannabis reform has been enacted over the past four decades, cannabis businesses still are not fully tolerated, most evidently in federal restrictions, such as the way banking is restricted.

Representative Ed Perlmutter re-introduced the bill, as promised, saying that it would allow cannabis businesses to access the banking system—like any other industry—and would bring more money into the economy and offer the opportunity to create good-paying jobs. 

On September 21, the House Rules Committee approved the SAFE Banking Act as they sifted through over 800 amendments filed for the $778 billion FY2022 National Defense Authorization Act (NDAA) to determine which ones will get a floor vote. As Representative Perlmutter sits in the Rules Committee, the move suggests he has influence.

Currently, The Financial Crimes Enforcement Network (FinCEN) Guidance from the Department of the Treasury provides informal guidance on banking with cannabis businesses, but still nothing to immunize a financial institution from federal prosecution—only an act of Congress can do that.

Bloomberg reported that the SAFE Banking Act would be a boon for cannabis companies—which up until now have been forced to do business in cash thanks to federal banking restrictions. Cannabis-adjacent companies that provide financial services agreed.

“Passage of the SAFE Banking Act is a historic, significant step forward for the cannabis industry, which deserves more legitimacy and access to banking, insurance and other services just like any other mainstream industry. This legislation will open up much-needed access to financial institutions and loans for cannabis industry entrepreneurs,” said Ryan Hale, Chief Sales Officer of Operational Security Solutions (OSS). “Meanwhile, as the sheep dogs for the industry in security, we know that many compliance issues will remain as long as cannabis is still considered a Schedule I drug and passage of the SAFE Banking Act will only mean more regulation for the industry.”

The bill would protect banks that cater to state-licensed cannabis business from facing punishment from federal regulators. As of December 2020, the U.S. Treasury found that 515 banks and 169 credit unions already provide such services.

NORML sent leaders in Congress a letter in support of its inclusion as part of the NDAA. NORML Political Director Justin Strekal applauded the legislation cautiously:

“It is critical to balance the need to accomplish comprehensive reform at the federal level and make every effort possible in the immediate term to support the successful state-level programs to ensure safe and efficient consumer access to quality cannabis that is cost-competitive with the unregulated market,” Strekal said. “For those reasons, we support the inclusion of the SAFE Banking Act in any piece of legislation that is going to be enacted into law.”

Advocates speculated that the SAFE Banking Act might have a better chance of success than a standalone bill, because of its bipartisan support and because Senators don’t want any minor bill holding up the “must-pass” NDAA.

Leaders such as Senate Majority Leader Chuck Schumer and Senator Cory Booker have been somewhat hesitant to support the bill without seeking broader reform. Both see more comprehensive cannabis reform such as the Cannabis Administration and Opportunity Act (CAOA).

“As someone who has been working inside the banking industry for most of my career, I’ve seen firsthand the many challenges banks face when trying to serve cannabis businesses,” said Andrew Montgomery, Founder and CEO of HD Compliance. Montgomery is a seasoned banking professional with more than 25 years as a senior executive in the industry. 

He continued, “Though this is not the first time that lawmakers have added a seemingly unrelated bill to a broader bill that is likely to pass without increased scrutiny, we must remember that the SAFE Banking Act has already been passed four times in the House, two of them were associated with COVID-19 economic relief bills. The Senate failed to act on each of those bills. However, burying it in the Defense Authorization Act may give cover to GOP senators that want to support SAFE Banking and allow Senator Cory Booker to oppose the bill. This very well could be a back door way of passing this needed legislation.”

While some leaders argued about the appropriateness of including the SAFE Banking Act in a military spending bill, veteran support for cannabis is high. NORML, for instance, clarified that the spending bill was indeed an “appropriate vehicle” for cannabis reform. According to the American Legion, nearly one in four veterans currently consumes cannabis for medical reasons.

The post U.S. House Approves SAFE Banking Act as Part of Military Spending Bill in Historic Vote appeared first on High Times.

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Author: Benjamin M. Adams

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BankingCannabis Industry NewsFrom Our WritersSAFE Banking Act

U.S. House Approves SAFE Banking Act… Again

terry roston

The U.S. House of Representatives on Tuesday again approved the SAFE Banking Act which would allow banks to work with cannabis firms without fear of penalty, Bloomberg reports. It marks the second time this yearand the fifth time since 2019that the chamber has approved the legislation, which has yet to be considered in the Senate.

Prior to the House vote, U.S. Cannabis Council Chief Executive Steven Hawkins noted that most of the legal cannabis industry’s 2020 transactionsmore than $17 billionwere cash sales.

“Forcing legitimate, well-regulated cannabis businesses to conduct most of their business in cash is anachronistic and a clear threat to public safety.”Hawkins via Bloomberg

Rep. Ed Perlmutter (D-CO) said that allowing the industry access to normal banking services would drive money into the economy and offer good-paying jobs.

“[The SAFE Banking Act] will strengthen the security of our financial system & keep bad actors like cartels out,” he wrote on Twitter following the bill’s passage on a voice vote. “Most importantly, it will reduce the risk of violent crime in our communities. It’s passed the House 5 times. We cannot wait any longer to address this public safety threat.”

While technically controlled by Democrats, the Senate is split 50-50 between the parties and the legislation would require support from either some Republicans or conservative Democrats in order to pass the chamber.

In the Senate, the bill is in the Committee on Banking, Housing, and Urban Affairs.

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Author: TG Branfalt

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cannabiscannabis bankingColoradoGovernorGovernor Jared PolisLegalizationmarijuanaNewsSAFE Banking Act

Governor of Colorado Pens Letter Urging Legitimate Cannabis Banking

terry roston

As Democrats in Congress appear eager to finally tackle comprehensive marijuana reform, Colorado Governor Jared Polis hopes they address one particular cannabis policy first.

In a letter to a trio of Democratic senators on Friday, Polis urged them to pursue legislation implementing new banking and taxation measures that would enable financial institutions to work with cannabis businesses.

“I am thrilled that you are bringing forward a long-term, comprehensive solution that deschedules cannabis while enhancing social equity pathways,” wrote Polis, a Democrat serving his first term as governor of Colorado. “I hope that you will first focus your efforts on the two biggest barriers to the success of the cannabis industry: banking and IRS Code Section 280E (280E).

He said that “the cannabis industry has been stymied by 280E, which prevents these businesses from taking business-related deductions associated with the sale of cannabis.

“Congress must swiftly act to pass any measure, a number of which have been introduced in past sessions, to make an exception for legal cannabis businesses from 280E,” he wrote. “While the CAOA would address this issue by descheduling cannabis, a narrow measure focused on relieving cannabis businesses from the detrimental effects of 280E would expeditiously solve this problem.”

Polis wrote the letter to Senate Majority Leader Chuck Schumer, Senator Cory Booker and Senator Ron Wyden, who have thrown their weight behind the Cannabis Administration and Opportunity Act (CAOA), legislation that would effectively legalize marijuana on the federal level. 

The bill was introduced in draft form by the three Democratic senators last month.

But while members of Congress continue to wrangle out the details of that legislation, Polis believes there is a ready-made cannabis reform bill just waiting to be passed: the SAFE Banking Act, which Polis backed as a member of Congress representing Colorado’s second district.

“Legislation to address these issues has more bipartisan support than ever before and can be passed in the short-term as you continue to work on the details of the CAOA,” Polis wrote in the letter.

The SAFE Banking Act, Polis said, “has passed the U.S. House of Representatives four times but has never been taken up by the Senate.

“As a Congressman, I co-sponsored Representative Ed Perlmutter’s SAFE Banking Act because it is essential to bringing cannabis payments out of the shadows,” Polis wrote. “Medical and recreational cannabis sales in the U.S. were estimated to total $17.5 billion last year, but because of antiquated federal banking regulations, almost all cannabis transactions are cash-based. Not only are cash-only businesses targets for crime, cannabis businesses are further disadvantaged compared to other legal businesses by being unable to open bank accounts or obtain loans at reasonable rates.”

Polis continued to explain that it’s harmful for an industry as successful and large as cannabis industry to be forbidden from legitimate banking institutions. Polis continued, “The cannabis industry is simply too large to be prohibited from banking opportunities, and the Senate must remedy this harm by bringing this measure up for a vote in the Senate Committee on Banking, Housing, and Urban Affairs immediately.”

Polis, a longtime cannabis reform advocate, wrote the letter amid growing signs that Democrats are poised to deschedule marijuana under the Controlled Substances Act, a move that would finally put the federal government in line with states like Colorado that have already legalized pot.

Schumer said earlier this year that Democrats were ready to seriously tackle the issue––even as President Joe Biden remained wary of legalization.

“We will move forward,” Schumer said. “[Biden] said he’s studying the issue, so [I] obviously want to give him a little time to study it. I want to make my arguments to him, as many other advocates will. But at some point we’re going to move forward, period.”

The post Governor of Colorado Pens Letter Urging Legitimate Cannabis Banking appeared first on High Times.

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Author: Thomas Edward

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