The Conference of State Banking Supervisors (CSBS) urges Congress to retain the Secure and Fair Enforcement (SAFE) Banking Act in the final America COMPETES Act to provide legal marijuana businesses with access to financial services.
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“By granting a safe harbor to financial institutions, Congress can bring regulatory clarity to the financial services industry, address public safety concerns, and ensure access to financial services for compliant marijuana and marijuana-related businesses. to the state,” James Cooper, acting president and CEO of CSBS, wrote to House and Senate leaders. “Safe Harbor should be extended to all financial services, including money transmission, because the negative impact of the current inconsistency of state and federal laws is not limited to deposit-taking institutions.”
While marijuana is legal in 37 states and the District of Columbia for medical purposes and in 18 states and the District of Columbia for recreational purposes, these businesses are barred by federal law from accessing financial services such as bank deposits, loans, money transfers and accepting credit cards for payment, Cooper said. This leaves legal marijuana businesses largely operating as cash-only operations, which has led to an increase in crime, as criminals know that these businesses keep large amounts of cash.
“Passing the bipartisan SAFE Banking Act would reduce the risk associated with large cash-and-carry operations and increase public safety. Passage of the SAFE Banking Act would also support economic development in states that have legalized cannabis while improving the safety of industry employees and the public. Tax collection, consumers and the financial system will remain at risk until financial institutions can serve the industry without worrying about violating federal law,” Cooper added in his letter.
CSBS is the national organization for banking regulators in the 50 states, American Samoa, the District of Columbia, Guam, Puerto Rico and the US Virgin Islands.
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