The SAFE Banking Act would improve public safety, help the government combat illicit finance, and provide certainty in the evolving legal landscape by granting cannabis businesses operating in compliance with state laws access to essential financial services, the American Bankers Association said in a letter to House and Senate leaders.
The SAFE Banking Act would prevent regulators from prohibiting or discouraging financial institutions from serving cannabis businesses in states where it is legal. The bill was introduced in the Senate by Sen. Jeff Merkley (D-Ore.) and in the House by Rep. Dave Joyce (R-Ohio).
In its letter, ABA noted that while nearly every state has legalized marijuana in some form, the uncertain legal landscape means state-licensed marijuana businesses frequently operate on a cash basis, outside the regulated banking system.
“Passing this legislation would reduce illicit finance risk and increase financial transparency for cannabis- and hemp-derived proceeds,” ABA said. “Highly regulated banks and other financial institutions must adhere to stringent anti-money laundering and counter-terrorist financing laws and rules, conduct due diligence regarding their customers, screen transactions for suspicious activity, and keep records.
“Bringing these state-licensed businesses and their proceeds into the formal financial system would provide a meaningful level of transparency and accountability by enabling financial institutions to better identify and report illicit finance risk,” the association said.
