On Wednesday, the Senate introduced a revamped cannabis banking bill featuring an updated title and several fresh provisions pertaining to federal financial regulations, guidance, and reporting requirements. This time, a familiar foe has come on board to support the next iteration of regulated cannabis banking—the SAFER Banking Act.
This newly introduced legislation, officially known as the Secure and Fair Enforcement Regulation (SAFER) Banking Act, comes as a result of extensive bipartisan collaboration led by Senators Jeff Merkley (D-OR) and Steve Daines (R-MT). The act aims to deter banking regulators from imposing penalties on financial institutions for offering services to cannabis enterprises, shield earnings generated by cannabis-related operations from money laundering regulations, and facilitate the provision of loans and financial solutions to cannabis companies.
Democratic Senate Majority Leader Chuck Schumer, who has made banking reform a priority, hailed the introduction of the SAFER Banking bill:
“This legislation will help make our communities and small businesses safer by giving legal cannabis businesses access to traditional financial institutions, including bank accounts and small business loans,” the New York Democrat said in a statement with four other senators. It also prevents federal bank regulators from ordering a bank or credit union to close an account based on reputational risk. We look forward to the markup of this bill in the Senate Committee on Banking, Housing and Urban Affairs on September 27.”
Interestingly, one of the bill co-sponsors is none other than Senator Cory Booker (D-NJ), who was previously a voracious detractor of the first iteration of SAFER—the SAFE Banking Act.
Recall that in July 2021, Cory Booked was quoted as saying he “will lay myself down” to block any other senators who seek to pass marijuana banking legislation before the body approves comprehensive cannabis reform like the federal legalization bill he newly unveiled alongside Senate Majority Leader Chuck Schumer (D-NY).
The comprehensive reform he was seeking to pass in lieu was the Cannabis Administration and Opportunity Act (CAOA), a more encompassing bill that sought to legalize cannabis nationwide by rescheduling it from the list of controlled substances, as well as establishing a framework for interstate commerce.
CAOA also would have provided for the expungement of records of some non-violent federal cannabis offenders. Furthermore, CAOA establishes a framework for a federal cannabis tax and FDA regulations for cannabis products and research.
SAFE Banking Becomes SAFER Banking
Several noteworthy changes have been introduced in the SAFER Banking Act compared to its predecessor. These changes include the omission of previous language that discouraged federal regulators from taking actions against financial institutions working with state-legal cannabis businesses.
Additionally, the new legislation specifies that regulators must have a valid reason when requesting or mandating the termination of bank accounts for any business.