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Marijuana Producers to Congress: Let Us Have Bank Accounts
American marijuana producers, bankers, and real-estate firms came to Washington this week to lobby Congress in favor of Rep. Ed Perlmutter’s marijuana banking bill. The Colorado Democrat has labored for six years to let financial institutions handle money from cannabis businesses in the states that have legalized marijuana. After the House Financial Services Committee backed his SAFE Banking Act in March, Perlmutter says he hopes for a floor vote before the end of June.
“Businesses that are legitimate in their state ought to have legitimate banking relationships that allow them to accept credit cards, get loans and have payroll accounts,” Perlmutter told Barron’s. “Just normal banking activity.”
Wall Street is betting billions of dollars on U.S. cannabis chains like Curaleaf Holdings (CURLF.OTC) and Green Thumb Industries (GTBIF.OTC). But those companies can’t bank at federally-insured institutions or list their shares on big exchanges like the NYSE or Nasdaq.
After a March hearing, during which industry representatives told of the dangers they face in carrying piles of cash from cannabis dispensaries, the Financial Services committee voted 45 to 15 to advance the bill. Eleven Republicans joined all the Democrats in supporting the reform.
The SAFE act would protect financial institutions from prosecution if they work with cannabis businesses that comply with state law. It must now get marked up and possibly amended by the House Rules Committee before it goes to a floor vote.
Perlmutter said the legislation has now collected 185 co-sponsors, including a couple dozen Republicans. A version introduced in the Senate in April has 27 sponsors. The reforms have wide backing outside Washington, including from the American Bankers Association, the Credit Union National Association, and the Independent Community Bankers of America. State attorneys general from 38 states joined in support of the bill this month, as did the National Association of State Treasurers.
Congress is coming in to its appropriations cycle, so the SAFE Banking Act sponsors have to squeeze their bill between appropriations measures, Perlmutter said. That’s why hundreds of industry members came to Washington this week for a series of lobbying activities organized by a trade group known as the National Cannabis Industry Association. Perlmutter said he even got a visit from a California grower.
“The good news is that I’ve got the support of [Financial Services Committee Chair] Maxine Waters,” Perlmutter said, referring the powerful California Democrat. “And I sit on the Rules Committee. That doesn’t hurt.” If he can get another dozen or so co-sponsors, he thinks he can get the bill through the House. Then it’s the Senate’s turn.
There are other cannabis-related bills before Congress, including ones that would legalize the drug federally altogether. Perlmutter said the SAFE Banking Act addresses the most pressing problem.
“There’s a business aspect,” he said, “But getting that cash off the street is a public safety issue.”Content originally published by Barrons on May 23, 2019.