On Sept. 25, 2019, the U.S. House of Representatives passed the SAFE Banking Act bill (H.R. 1595) by a margin of 321-103. Almost all Democrats supported the bill along with almost half of the Republicans. The bill provides a safe harbor to financial institutions who provide services to marijuana-related businesses in states where marijuana is legal. Thirty-three states have made marijuana legal for either recreational or medical use. Now the bill moves onto the Senate, where a committee may vote on it by the end of 2019. Note, the bill also provides a provision prohibiting financial institutions from terminating a consumer’s account unless the financial institution has a valid reason, which would not include a reason based on reputation risk.

Author

John Zasada, JD, CAMS – Compliance Consulting Director, Financial Institutions Group. John can be reached at zasada@doeren.com.