SAFE Banking Act of 2021 passed by the House of Representatives
On the eve of April 20, members of Congress offered a gift to the burgeoning cannabis industry.
The House of Representatives on Monday passed the SAFE Banking Act of 2021, which paves the way for financial institutions and banks to work with cannabis companies.
The SAFE Banking Act of 2021 “generally prohibits a federal bank regulator from punishing a custodian for providing banking services to a legitimate cannabis company,” reads a summary of the legislation.
“Prohibited penalties include terminating or limiting the deposit insurance or stock insurance of a custodian just because the institution provides financial services to a legitimate cannabis company and discourages or otherwise discourages a custodian from providing financial services to such a company,” said read the summary.
“In addition, income from a transaction that involves activities in a legitimate cannabis business is not deemed to be income from illegal activities. Income from illegal activities is subject to anti-money laundering laws. Additionally, under federal law, a custodian is not liable or subject to loss of assets for the provision of a loan or other financial services for a legitimate cannabis-related business. ”
It continued: “The bill also provides that a Bundesbankenagentur may not request or order a custodian to terminate a customer account, unless (1) the agency has a valid reason for this and (2) this reason is not based solely on this at reputational risk. Good reasons for terminating an account include threats to national security and involvement in terrorist financing, including government sponsorship of terrorism. “
Where is the SAFE Banking Act of 2021 going next?
The SAFE Banking Act of 2021, introduced last month by Democratic MP Ed Perlmutter, was passed smoothly by 321-101 votes on Monday.
It will now go to the Democratically controlled Senate, where Majority Leader Chuck Schumer has “announced that they will receive a vote,” according to The Hill.
Schumer has recently been voicing bullish notes on cannabis reform in general. Earlier this month, the New York Democrat said he was ready to hit pot legalization – whether or not President Joe Biden is on board.
“We will go forward,” said Schumer at the time. “[Biden] said he is studying the subject, so [I] I obviously want to give him a little time to study it. I want to bring my arguments to him, as many other proponents will. But at some point we’ll move forward, period. “
Nearly 40 states have legalized medical marijuana, and a growing number of states and cities have also adopted recreational cannabis in recent years. Nevertheless, the pot remains illegal at the federal level under the Law on Controlled Substances. Schumer said seeing how well legalization works at the state level helped get him into legalization.
“In 2018 I was the first member of the democratic leadership to campaign for an end to the federal ban. I’m sure you’re asking, “Well what has changed?” Well, my thinking has evolved. When some of the early states – Oregon and Colorado – tried to legalize, all opponents spoke of the Parade of the Terrible: Crime would increase. Drug use would increase. Anything bad would happen, ”said Schumer.
“The legalization of states has worked remarkably well. You were a great success. The Terrible Parade never took place and people were given more freedom. And the people in these states seem very happy. “
Polls show Schumer’s views put him in a majority in the American public, but Biden has so far defied calls to end the pot ban.
As a candidate last year, Biden sometimes sounded awkward trying to thread the needle into the subject, saying in an interview that “it“ doesn’t make sense for people to go to jail for a pot, ”but he still does not quite did support full legalization.