Democratic Senator John Hickenlooper of Colorado last week called for the passage of the SAFE banking law, saying the nation’s refusal to allow cannabis companies access to traditional financial services is a “recipe for disaster.”
Addressing a virtual policy conference last Wednesday, Colorado Senator Hickenlooper said federal regulations that deny banking services to state-licensed cannabis companies are a magnet for criminal activity and run counter to the goals of marijuana legalization.
“If you really want to build an industry based on gangs and cartels, make all the money,” Hickenlooper said She said At a cannabis curation event hosted by The Hill. “It’s almost like the system in place now that is geared toward promoting things we don’t want.”
Under current federal regulations, banks are subject to penalties under money laundering and other laws for serving cannabis businesses, even those legal under state law, forcing the licensed cannabis industry to operate in a risky, highly cash environment. Hickenlooper, who served as Colorado’s governor when state voters legalized recreational cannabis in 2012, said the cash-only system that dominates the cannabis economy is a “recipe for disaster” and “a blueprint for disaster.”
“If you unschedule it, banks can start banking so that it is no longer a cash business,” Hickenlooper said. “There are many negative consequences of being a cash business. The first is that the companies themselves cannot take out loans.”
Colorado Supports Safe Banking Pending Act
Under pending federal legislation, the Safe and Fair Banking Act (SAFE), federal bank regulators will be prohibited from penalizing banks that choose to service cannabis businesses that do business under state law. The legislation was initially introduced to the House of Representatives in 2013 by Representative Ed Perlmutter of Colorado, who reintroduced the bill in each subsequent session of Congress.
Hickenlooper noted Wednesday that the SAFE banking law would not “go against the will” of states that have not legalized cannabis in any way, adding that the reform would benefit states that instituted cannabis policy reforms.
“In terms of banking, I don’t think there is any point in punishing those countries whose citizens voted to legitimize,” he said.
In April, the Safe Banking Act It was approved as a separate bill by the House of Representatives. And in September the house approved the legislation As part of the defense spending authorization bill that must be passed. The House and Senate are currently working to reach consensus on a defense spending bill, leaving the fate of the cannabis bank provisions in the air.
Bill enjoys bipartisan support
SAFE has bipartisan support in Congress, and passed the Democratic-majority House in May by 321-10 with the support of 106 Republicans, including Representative Nancy Mays of South Carolina. Last month, Mace unveiled a separate invoiceState Reform Act, which would legalize and regulate marijuana at the federal level.
“There is nothing really controversial about cannabis except what there is here in Washington where there are some members who are afraid of it or are afraid to touch it,” Mays said last Wednesday. “It shouldn’t be this way.”
The Mace bill serves as a replacement for the MORE Act, a sweeping proposal made by Democrats that would also legalize cannabis at the federal level. The legislation also includes broad social justice provisions including the elimination of federal cannabis crime. The MORE Act imposes higher taxes than Mace’s bill, while increasing revenue for investments in communities affected by the war on drugs.
Mace agreed with Hickenlooper that cannabis banking regulations should be changed, saying the current system provides an incentive for criminals while putting legal business owners at risk.
“We fund cartels by owning an entirely cash business,” Mays said. “it’s dangerous.”
The SAFE banking law also has broad support from the governors of jurisdictions that have legalized marijuana. In November, a bipartisan group of 24 state and territory governors with legal cannabis sent a message To congressional leaders demanding the passage of the legislation.
The governors noted in the letter that while cannabis has been legalized in some form by the majority of US states, the continued lack of traditional banking and large amounts of cash throughout the supply chain leaves the legal marijuana business at increased risk of theft and other crimes. In addition, the lack of access to loans hinders the growth of the booming industry.
The governors wrote: “The Safe Banking Amendment will remedy these harms and help keep communities in our states and territories safe by allowing legitimate and legal cannabis companies access to banking services.”