Nikolas Komyati and Patrick Medeo of Bressler, Amory & Ross. Courtesy photo Is it Time to (Finally) Pass SAFE Banking for the Cannabis Industry?
Without regard to the variety of positions arguing against stand-alone banking reform, the reality is that years of congressional stagnation has left a growing industry banking in the grey.
June 07, 2022 at 10:18 AM
8 minute read
At this point, the Secure and Fair Enforcement Banking Act (the SAFE Banking Act) is well known. The law would not formally legalize marijuana on a federal level. Rather, for depository institutions, the SAFE Banking Act would prohibit federal regulators from penalizing them for providing financial services to state-legal cannabis businesses. The law would also re-categorize proceeds from such businesses as not deriving from unlawful activity, thus abrogating application certain anti-money laundering laws. Moreover, institutions would not be subject to asset forfeiture for providing loans or other services to legitimate cannabis-related businesses. Succinctly put, the SAFE Banking Act seeks to harmonize state and federal law by creating a safe harbor for depository institutions providing banking services to properly licensed cannabis-related businesses and ancillary businesses that serve them.
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