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Home / Business / The Senate's hearing represents a step towards providing marijuana banking access

The Senate's hearing represents a step towards providing marijuana banking access



A key Senate committee met on Tuesday to discuss regulatory arrangements that would allow banks to service state legal marijuana businesses without the risk of being punished by federal financial regulators, and the panel chairman concluded that "a case has been quite strongly here "that the problem needs to be solved, but that it is a" very important and complex issue that we need to get right. "

Senate Banking, Housing and City Committee, led by Senator Mike Crapo (R-ID) , the hearing announced last week, which surprised some lawyers given the senator's previous statement that he would not commit to investigating the problem of cannabis financial services while the federal government still considered marijuana as a controlled drug.

A bipartisan bill ̵

1; The SAFE Banking Act – a main focus of the conversation – the House's version of the law cleared the Chamber's Financial Services Comm. ittee in March, and while advocates hoped it would be ahead of the entire chamber in front of the recess in August, expectations have moved towards the fall for floor intervention.

When a Marijuana Moment reporter asked Crapo after the hearing if he had spoken to Senate's majority leader Mitch McConnell (R-KY) about the bill, the chairman replied that he "spoke to almost all of our colleagues about this."

In response on questions from other reporters about the next steps, he said the committee "is trying right now to see if we can find a way to address the various issues" ahead of a potential mark of cannabis banking law and that he does not " to hold further hearings on the case. "

Sen. Sherrod Brown (D-OH), a member of the panel, said in his opening remarks during the hearing that" the legal cannabis industry is one of the fastest growing in the United States and employs hundreds of thousands of people "" 19659002] "No matter how you feel about marijuana yourself, we have a duty to look for the workers who work in this industry and the communities they represent," he said. r The Senate Committee included the SAFE Banking Act sponsors Sens. Cory Gardner (R-CO) and Jeff Merkley (D-OR), representative of the Credit Union National Association (CUNA) Rachel Pross, representative of the American Bankers Association (ABA), Joanne Sherwood, Smart Approaches To Marijuana (SAM) Vice President of Government Affairs Garth Van Meter and LivWell Enlightened Health CEO John Lord.

See Senate Marijuana Banking below:

Lawyers argue that giving banking access to neighboring businesses will increase financial transparency and mitigate security risks, since such companies in Today is largely forced to operate on a cash basis, making them the target of crime.

Gardner said in his testimony that "the states are in this case, and the federal government has failed to respond. It has closed your eyes and plugged your ears and pretend the problem will disappear. It won't. "

" Keeping the dollars outside the banks means we are losing the opportunity to track where the dollar goes, "he added. “It also makes it harder to ensure that all taxes are paid. It makes it easier for criminals in the illegal market to pose as legitimate. And it leaves hundreds of millions of dollars in cash in the state. "

He acknowledged during the hearing that" this is a difficult hearing, a difficult topic. I know that. "

" But we were sent here to deal with the difficult issues, "he said. "It's an important step forward. First hearing we've had about this case when the federal government wakes up to the reality that the cannabis issue is not going to disappear and that we need action."

After the hearing, Gardner told the reporters that he was confident that there is enough support in the Senate to adopt not only the SAFE Banking Act but also another bipartisan proposition as he cosponsoring to allow states to set their own cannabis policy without the risk of federal interference.

"[I] t would pass by majority support, and I think it would have a majority of Republicans voting for it too," he said.

In particular, the Senator told Marijuana Moment that he is talking to McConnell "constantly" about cannabis problems, as late as Monday [19659002] "If they want me to shut up, they can just pass this and the STATES law, and that's how I will shut up," he said, referring to bank and broader states' bills of rights.

But GOP attendance at the meeting was lacking overall, with only Crapo and Gardner emerging from the majority, and questioned the extent to which the Senate Republicans are interested in promoting cannabis bank legislation.

Merkley said in his testimony that "the lack of availability of financial services for cannabis-related businesses in states where it is legalized has created a scenario where businesses are forced to operate in all cash, leading to unsafe environments for all involved parties. "

" Financial institutions support legal clarity and security, and a legal consultation will provide an opportunity to address outstanding issues and ensure a better understanding of the proposed bipartisan law, "he said, adding that he hopes the hearing "Will give members the opportunity to hear directly from witnesses who have direct experience in the challenges of the financial, cannabis and law enforcement challenges."

During the hearing, Merkley said there is "nothing good about forcing the world to operate with cash." [19659002] "It is an invitation to money laundering. It is an invitation to organized crime. It's an invitation to robbery. It's an invitation to cheat on your treasures or cheat the employees, ”he said. "Let's fix this. Let us respect the states 'rights vision for all states that have said that this makes sense here at our citizens' site."

"Although the SAFE Banking Act does not cure all cannabis-related banking challenges, it would help the 33 states that have legalized cannabis in one form or another to make their communities safer, collect taxes and regulate their cannabis markets effectively, says Sherwood, President and CEO of Citywide Banks, in written testimony on behalf of ABA. Also help banks and their clients in states without legal cannabis regimes by addressing the unintended consequences for non-related businesses that provide products and services to the cannabis industry, their employees or service providers, without undermining the ability of each state to ban the sale and use of cannabis within its borders. "

Pross, the Head of Risk Credit for the Credit Credit Union, said that her association did not" have a position on federal legalization of cannabis ", but that" many credit unions operate in states and communities that have made cannabis use or growth legal for medical purposes. and / or recreational purposes "and that CUNA strongly believes that" financial institutions should be allowed to serve lawful activities engaged in activities authorized under their state laws, even when such activity may be contrary to federal law. "

" On behalf of America's credit unions and their 115 million members, w e encourage both Congress and Administration to work to make this law the law and provide financial institutions with the security needed to better serve our communities. "

The Ban Group SAMs Van Meter said members of the committee were tasked with addressing" Whether we want to promote and increase drug use during an addiction crisis or counteract drug use and help people find improvement and healing "by discussing will provide access to banking for cannabis businesses.

"By leaping on a technique over bank rules, the marijuana industry hopes to gain many of the benefits of federal legalization without a public health debate," he said in testimony.

Attached to SAM's Submission is a letter expressing concern about the potential consequences of the passed SAFE Banking Act, signed by former Drug Enforcement Administration and Office of National Drug Control Pol ice cream managers.

Sen. Brian Schatz (D-HI) talked about marijuana research barriers and noticed that he cosponsored bipartisan legislation introduced last week that would address the case with Sens. Chuck Grassley (R-IA) and Dianne Feinstein (D-CA).

Van Meter jumped in to say that "if the marijuana industry was concerned with research, then I don't think they would sell any of these extremely high powers."

"Well, wait, I'm worried about research, Sa Schatz." I'll let you answer the questions, but I'm not going to allow you to take a pot shot against the people you testify with. "

Lord, who is chairman of the Cannabis Trade Federation group, said "due to significant compliance costs associated with serving cannabis customers under existing policies, financial institutions charge cannabis companies significant monthly fees."

"Our company pays over $ 3,000 per month for the privilege alone of having an account, ”he said about LivWell Enlightened Health. “Today's situation is particularly challenging for small businesses. Although, because of our size, we are able to absorb the additional costs associated with cash handling and exorbitant bank charges, many small businesses are not. "

" Moreover, banking solution can significantly help cannabis businesses to secure business loans. This is crucial for small business owners who may not have access to other sources of capital. It should be noted that these small businesses are also being pushed by paragraph 280E of the Internal Revenue Code, which prevents all cannabis companies from deducting standard business expenses when calculating the tax. If there is any hope in helping small businesses – including minority and women-owned companies – survive and thrive, we need to fix the banking situation and change section 280E so that cannabis companies are taxed like any other business. "

Sen. Bob Menendez (D-NJ) discussed the challenges that cannabis companies face in securing loans and designated separate laws he introduced on Monday that would allow such companies access to insurance.

Sen. Tina Smith (D-MN) claimed that federal marijuana reform should not stop at bank access.

"I think we have to realize that when we look at the punishment for the involvement of businesses with marijuana, we cannot forget the thousands of individuals who have spent time behind the bars of their involvement in marijuana," she said. African-American men have paid a disproportionate price for generations of aggressive enforcement of marijuana laws. "

Brown, the ranking democrat, made a similar point and said that financial services hearing is" just a piece of conversation Congress must have about marijuana politics. "

" People should not be thrown into prison or their future threatened by a criminal record of non-violent marijuana offenses, "he said.

Other issues raised during the meeting include the lack of access to financial services for hemp businesses Since the crop was federally legalized under Farm Farm 2018, barriers to marijuana research and how to provide banking access to the industry can help regulators identify illegal economic activity. Other spokesmen for a legislative resolution of the banking case include a coalition of 20 two-part governors, the National Association of State Treasurer, top economic regulators in 25 states, and a majority of state attorneys general. in the Senate

The Banking Hearing marks the sixth congressional hearing one about marijuana politics this congress, including a historic meeting with the Criminal, Terrorist and Homeland Security Committee on roads to end the federal ban on cannabis. Another committee is scheduled to discuss hemp production on Wednesday.

Senate Plans Second Cannabis Hearing For Next Week

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