Democratic Senator Chuck Schumer says Senate Close to Agreeing on Cannabis Banking Reforms

There are several ways that cannabis businesses are treated differently than businesses of other industries, the situation with banking being one of the most impactful. Federal law prohibits banks from granting services to cannabis businesses even when operating under a state license, making banks very risk-averse to federal prosecution. However, that could change if bipartisan legislation called the SAFE Banking Act gets passed. 

On Sunday, Senate Majority Leader Chuck Schumer, a Democrat, indicated that the Senate is close to agreement on the legislation that, if passed, will grant access to the US banking apparatus for cannabis businesses. Schumer said that talks are underway with certain Republican senators.  

The SAFE Banking Act would remove the federal ban preventing financial institutions from offering various services to businesses that deal with cannabis and would prevent federal banking regulators from penalizing banks that provide these services to state-legal cannabis businesses.  

Under the act, cannabis business proceeds would be declared lawful and no longer subject to anti-money laundering laws.  

“I am working in a bipartisan way with Democrats and Republicans to take the SAFE Banking Act, which allows financial institutions to involve themselves in cannabis companies and lend money to them—but it also does some things for justice, such as expunging a record,” said Schumer during a TV debate with Republican Joe Pinion, a former television host who is running against Schumer in the New York State.  

Cannabis stocks saw a rally after Schumer’s remarks.  

As the senator implied, The Safe Banking Act, approved by a 321 to 101 vote in April by the US House of Representatives, would result in expungements of some federal cannabis convictions.  

It is estimated that cannabis is already a $17 billion industry that supports as many as 320,000 jobs across America. However, much of that business is conducted in cash, making those operating cannabis retail operations vulnerable to theft and violent crime. 

In Washington State, three separate killings related to cannabis businesses happened in the span of one week. A young budtender was recently shot to death during an armed robbery of a commercial recreational cannabis store in Tacoma, police officers killed a suspect after a robbery at a cannabis store in Factoria, and a security guard was shot and killed during an attempted robbery in the town of Covington.

There is no other industry operating in America that is legal in various states yet federally prohibited. In the interest of public safety and good drug policy, it is time to legalize cannabis federally and remove it from the federal schedule entirely. Until that is done, however, removing banking restrictions and allowing cannabis businesses to operate like any other businesses makes sense. It will also be a step forward for preventing unnecessary risk for the thousands of Americans who go to work each day at businesses dealing in cannabis.