Legal & RegulationsArticle02 May, 2023

Lawmakers reintroduce SAFE Banking Act, a bill the cannabis industry hails as a lifeline

Lawmakers from both parties reintroduced the Secure and Fair Enforcement (SAFE) Banking Act, which the cannabis industry views as a financial lifeline.

KEY POINTS

Lawmakers from both parties reintroduced the Secure and Fair Enforcement (SAFE) Banking Act, which the cannabis industry views as a financial lifeline.
The legislation is expected to go before the Senate Banking Committee, a key step toward what would be the first Senate vote on the measure.
The bipartisan proposal would ensure that legal cannabis businesses have access to critical banking and financial services.

A group of bipartisan lawmakers reintroduced the Secure and Fair Enforcement (SAFE) Banking Act in the House and Senate on Wednesday, after the legislation designed to free up banking services for the cannabis industry stalled in last year’s Congress.

The bill, which has been tweaked since last session, was introduced by Sen. Jeff Merkley, D-Ore., Sen. Steve Daines, R-Mont., Rep. Dave Joyce, R-Ohio, and Rep. Earl Blumenauer, D-Ore.

If the critical banking and financial protections advance through committees, they could see a vote on the Senate floor for the first time. The bill, which has always had strong bipartisan support, passed in the House seven times previously.

“For the first time, we have a path for SAFE Banking to move through the Senate Banking Committee and get a vote on the floor of the Senate,” Merkley said in a statement. “Let’s make 2023 the year that we get this bill signed into law so we can ensure that all legal cannabis businesses have access to the financial services they need to help keep their employees, their businesses, and their communities safe.”

Senate Majority Leader Chuck Schumer, D-N.Y., expressed his support for the legislation on Thursday and said he would work to make sure the legislation includes criminal justice provisions when it reaches the floor.

Cannabis stocks Curaleaf Holdings, Trulieve Cannabis Corp, and Terrascend Corp all rose by double-digit percentages on Thursday. The bipartisan nature of the SAFE Banking Act’s reintroduction appeared to boost hopes of more relief to come in the industry.

“The SAFE Banking Act will provide urgently needed relief to cannabis businesses of all sizes and act as a stepping stone to broader reforms,” said Matt Darin, CEO of multistate cannabis operator Curaleaf, in a statement after the bill’s reintroduction.

Under current federal law, banks and credit unions face federal prosecution and penalties if they provide services to legal cannabis businesses because cannabis is still a Schedule I substance, the same classification as heroin and LSD. Schedule I substances are defined as drugs with no currently accepted medical use and a high potential for abuse, according to the federal Drug Enforcement Administration.

Without access to financial services, state legal cannabis businesses are forced to operate their businesses solely using cash, which can result in robbery, money laundering, and organized crime.

“This legislation will save lives and livelihoods. It is past time that Congress addresses the irrational, unfair, and unsafe prohibition of basic banking services to state-legal cannabis businesses,” said Blumenauer, founder and co-chair of the Congressional Cannabis Caucus.

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