SAFER Banking Act passes Senate committee and moves to vote

Cannabis companies doing business legally in their state are one step closer to potentially opening accounts with federally insured banks after the latest version of the SAFER Banking Act (formerly SAFE Banking) was approved by the Banking Committee on Wednesday, September 14th and 9th was approved by the Senate.

The Safe and Fair Enforcement Banking Act now moves to the Senate, where it faces several more hurdles and possible changes before a full vote. If passed by the Senate, it will move to the Republican-controlled House of Representatives.

“Cannabis banking is just one part of the necessary conversation about marijuana policy. There is still much work to be done to acknowledge and repair the harm caused by the War on Drugs, to ensure everyone – including our veterans – has access to the medicines they need, and to conduct medical and scientific research on cannabis enable,” Senate Banking Committee Chairman Sen. Sherrod Brown, D-Ohio, said in a news release.

SAFER Banking would provide financial institutions with much-needed legal protections to serve businesses in the currently cash-dependent cannabis trade. Cannabis is currently considered a Schedule 1 substance in the eyes of the federal government, meaning that any bank that wants to obtain federal insurance cannot do business with cannabis companies, regardless of the laws in the company’s home state. If the Senate passes the SAFER Banking Act, cannabis businesses will not only be able to open bank accounts, but also take out small business loans, accept debit cards as a form of payment, and provide their employees with easier ways to obtain home loans, etc.

The latest language in the bill was submitted for consideration last week, written and led by Sens. Jeff Merkley, D-Ore.; Steve Daines, R-Mont.; Kyrsten Sinema, I-Arizona; and Cynthia Lummis, R-Wyo., and Majority Leader Chuck Schumer, D-N.Y.

“This legislation will help make our communities and small businesses safer by giving legal cannabis businesses access to traditional financial institutions, including bank accounts and small business loans,” the senators said in a joint statement. “It also prevents federal banking regulators from ordering a bank or credit union to close an account based on reputational risk.”

If passed, SAFER Banking could be a much-needed lifeline for an industry forced to conduct business in cash, putting thousands of cannabis sector budtenders, delivery drivers, growers and other ancillary workers at risk of violent crime. It would also provide much-needed capital for companies currently forced to operate with their own money or capital secured through private sources.

Seven previous versions of the bill passed the House but had failed to advance to a full vote in the Senate until Wednesday’s developments, although the bill, if passed, would still face stiff opposition from Republicans in the Senate and the GOP-controlled Senate The House of Representatives rejects the Senate. Opponents of the bill said the bill’s wording only further pandered to the wealthy and did nothing to reform criminal justice.

“This bill will make the lives of bankers, corporations and financial institutions safer, some of whom have been profiting illegally from the cannabis industry for years, which is ironic considering that many of the regular people who sold or consumed cannabis illegally are in prison cells “sitting right now,” said Sen. Raphael Warnock, D-GA.

The advancement of the SAFER Banking Act is the latest in a series of moves at the federal level regarding cannabis, including a Department of Health recommendation to move cannabis from Schedule 1 to Schedule 3. This decision has now been made I am going to the DEA to speak out. A congressional report released last week said the DEA would “likely” recommend the same, although an additional bill has also been introduced in the Senate that, if passed, would require congressional approval before cannabis can be reclassified.

All of this follows a potential government shutdown triggered by a stalemate in Congress over a new spending bill that could further delay progress on all of these matters. Senator Schumer said he will work to bring the SAFER Banking Act to a vote as quickly as possible, where 60 votes are needed to advance to the House floor.

“Regardless of how you view states’ efforts to legalize marijuana, this bipartisan bill is necessary – it will make it safer for legal cannabis businesses and service providers to operate in their communities and protect their workers,” said Senator Brown. “Through bipartisan work, we were able to find language that addresses the concerns of both Republicans and Democrats.”