A group of current and former cannabis regulators recommended several amendments to federal legislation designed to give legal cannabis companies access to traditional banking services, writing in a paper published last week that the Secure and Fair Enforcement (SAFE) Banking Act “is unlikely to result in equitable access to financial services” in its current form. The paper from the Cannabis Regulators of Color Coalition was published online on August 12.
The SAFE Banking Act would allow cannabis companies operating legally under state law to access banking services including deposit and payroll accounts, which are tightly regulated for such businesses under federal banking and money laundering laws. Supporters of the bill say it would make the cannabis industry, which operates largely in cash, safer for customers and employees. But more progressive cannabis activists including Sen. Cory Booker of New Jersey have said the SAFE Banking Act should not be passed without provisions that address the harms caused by decades of cannabis prohibition.
The authors of the paper published last week include former regulators of state and local cannabis programs. Cat Packer, the former executive director of the Los Angeles Department of Cannabis Regulation, left her post earlier this year, while Shaleen Title of The Ohio State University’s Moritz College of Law Drug Enforcement and Policy Center served as commissioner of the Massachusetts Cannabis Control Commission from 2017 to 2020. Rafi Aliya Crockett is a current Washington, D.C. Alcoholic Beverage Control Board commissioner, and Dasheeda Dawson is the manager of the City of Portland’s Cannabis Program.
The SAFE Banking Act
The SAFE Banking Act has been passed by the U.S. House of Representatives seven times, either as stand-alone legislation or as an amendment to another bill. But so far, the Senate has failed to approve the measure. The authors of the paper believe that the SAFE Banking Act should not be passed in its current form and discussed shortcomings of the legislation. They also suggested several amendments that would add
provisions to the bill.“SAFE would address only the legal and regulatory consequences potentially faced by financial institutions for providing services to the cannabis industry,”
in an executive summary. “Without additional legislative amendments to directly address challenges related to fair and equitable access to financial services, small and minority-owned cannabis businesses that currently have inadequate access to banking services or loans are likely to continue to be denied the full breadth and depth of services offered to others.”The four authors added that they could not support the bill in its current form, writing “regardless of whether Congress decides to pass cannabis banking reform as a part of more comprehensive cannabis policy reform or as a standalone issue, Congress should ensure that any legislation related to cannabis banking reform includes explicit provisions that seek to ensure fair and equitable access to financial services for all in the cannabis industry. Until the SAFE Banking Act is amended to include such provisions it should not be considered a safe bet to achieve equity in cannabis banking.”
Among the amendments proposed by the authors are a provision requiring financial institutions providing services to cannabis businesses to prove compliance with anti-discrimination laws. Another would require financial regulators to develop policies to achieve racial equity.
The paper from the Cannabis Regulators of Color Coalition was published less than a month after Senate Majority Leader Chuck Schumer and two Democratic Colleagues introduced comprehensive legislation to legalize marijuana at the federal level. Many Democratic senators would prefer Schumer’s broad bill, but most Republicans are unlikely to support such sweeping legislation, leading some advocates to suggest the SAFE Banking Act would be satisfactory incremental progress on the issue. The authors of the paper believe that an amended version of the bill, given the moniker SAFE Banking Plus, would be a compromise that could be supported by both sides.
“All federal laws related to cannabis should be written in a way that allows for the federal government to identify and address related disparities,” Packer told Marijuana Moment. “To the extent that federal legislation—SAFE Banking Plus—seeks to package reforms that would address several areas of law like banking, research, record expungement and veteran’s access to medical cannabis, etc.—that package should be written in a way that disparities related to banking, research, record expungement and veteran’s access to medical cannabis, etc. are acknowledged and addressed.”
The
from the Cannabis Regulators of Color Coalition, titled “Not a SAFE Bet: Equitable Access to Cannabis Banking, An Analysis of the SAFE Banking Act,” was published on August 12 by the Ohio State University Moritz College of Law.