The US House of Representatives has included provisions for the Secure and Fair Enforcement (SAFE) Banking Act in the National Defense Authorization Act (NDAA).
An amendment to the NDAA to include the SAFE Banking Act (H.R. 1996) that will enable banks in the US to lawfully deal with legitimate cannabis-related businesses was approved by vote last week.
As cannabis is not legal at the federal level, state cannabis businesses struggle to use banking services including accessing loans and paying taxes, forcing them to work with cash. If the bill is successful it will prohibit federal banking regulators from prosecuting institutions for providing banking services to legitimate businesses in the industry, protecting them and ancillary businesses from penalties such as asset forfeiture or the termination of an institution’s deposit insurance, as any cannabis business obeying the laws would be exempt from money anti-laundering laws.
The SAFE Banking Act was approved with an overwhelming majority by the house of Representatives in 2019 – marking the first time in history a standalone cannabis reform bill was brought before the house. The House approved the language of the act a further three times before the most recent vote, twice as part of relief packages for the COVID-19 pandemic and again in April.
The bill’s approval to be included in the “must-pass” NDAA, some believe, will allow for easier passage through to the Senate.
The non-profit National Organization for the Reform of Marijuana Laws (NORML), advocating for the reform of US cannabis laws for medical and non-medical use, is encouraging federal lawmakers to vote for approval of the act.
Commenting on the development, NORML Political Director Justin Strekal, said: “Enactment of the SAFE Banking Act would improve public safety and business efficiency in the 36 states that currently permit some form of retail marijuana sales. The Senate should ensure this provision remains in the final version of this funding package and approve it swiftly.
“The SAFE Banking Act is only the first step toward making sure that state-legal marijuana markets operate safely and efficiently. The sad reality is that those who own or patronize these currently unbanked businesses would still be recognized as criminals in the eyes of the federal government and by federal law. This situation can only be rectified by removing marijuana from the list of controlled substances.”
The development is welcome news for the industry, which has long been anticipating cannabis legalisation at the federal level.
Chairman of the UK’s Cannabis Industry Council, which is working to improve standards, quality and access in the industry, Professor Mike Barnes, commented: “I think this is good news for the global industry. It is clearly a step in the right direction towards federal legalisation.
“That in turn is good for the worldwide cannabis industry as it will help the US industry spread its knowledgeable wings and bring more products and delivery mechanisms into play globally.”
The bill will have to make it through conference before embarking on its final passage to the Senate.