Some segments of the U.S cannabis industry are akin to the ‘Wild West’ with businesses having to recruit armed guards to ferry cash.
This is due to Federal rules which sanction banks from working with registered cannabis businesses even though they operate within the laws of their home state. But, law makers are now under pressure to amend these regulations, which are seen as an ‘open invitation to organized crime’.
The Secure and Fair Enforcement (SAFE) Banking Act has been introduced into the U.S. Senate with support from 20 Republicans and Democrats. As well as preventing federal banking regulators from sanctioning banks working with state-compliant cannabis businesses it would also protect ancillary businesses from being charged with money laundering.
Some say the existing US banking legislation has prevented Canadian banking activity south of the border, and depressed U.S. cannabis stock market activity.
Bags of cash: An invitation to robbers
One of the co-sponsors of the SAFE bill is Oregon Democratic Senator Jeff Merkley. He said in a public statement: “Forcing legal businesses to operate in all-cash is dangerous for our communities. It’s absurd that cannabis business owners in Oregon have to shuttle around gym bags full of cash to take care of their taxes or pay their employees.”
“Operating in cash is an invitation to robbery, money laundering and organized crime,” he continued. “This is a public safety issue, and I hope that this will be the Congress to put this common-sense fix into law when we build a bipartisan consensus .”
The legislation was approved by the House Financial Services Committee last month and currently has 165 cosponsors.
Canadian-Born Patrick Morton of Cannabis Invest U.K. told CBD Testers: “This is one of the Wild West characteristics of the U.S. cannabis industry. Due to federal illegality and prohibition, federally-regulated banks are not doing business with cannabis companies.”
He continued: “Some cannabis dispensaries are hiring armed security guards to protect trucks moving around the state. However, I believe we are on the road to federal legalization which would bring an end to this issue, and this may well be achieved under this administration, before 2020.”
‘Toxic and Cruel Federal policy’
Steve Hawkins, executive director of the Marijuana Policy Project welcomed the developments, saying in a press release; “This is a historic and critical step forward for the nation’s burgeoning cannabis industry. Lawmakers seem to recognize the urgency and public safety implications of ensuring cannabis businesses can access banking services.”
“Regardless of where members stand on legalization, they can agree that it is in the public interest to make banking available to cannabis businesses in states where it is legal. This is a positive step forward to address an untenable tension between state-legal cannabis marketplaces and federal marijuana prohibition.”
“Ultimately, the banking issue is just one symptom of the toxic and cruel policy of federal marijuana criminalization. In order to truly bring the vibrant marijuana economy out of the shadows, actions need to be taken by Congress to end federal prohibition and the discrimination that comes with this failed policy.”
President Trump has indicated support for the SAFE legislation but backers must still convince skeptical Senate Republicans who are opposed to cannabis – despite it being legal to some extent in more than 30 U.S. States.