On March 26th, 27th and 28th the U.S. House Financial Services Committee met to debate multiple bills, including the Secure and Fair Enforcement (SAFE) Banking Act H.R. 1595 by U.S. Rep. Ed Perlmutter (D-CO) which would permit credit unions and banks in states where marijuana is legal to safely serve their members’ related needs. CUNA has engaged members of Congress to seek support for this bill, and has worked in a coalition with the American Bankers Association to attempt to move the bill forward. This is not an isolated issue that only impacts the West Coast; in Georgia the state Legislature has two bills that address the possibility of expanding the laws in this state to allow for regulated hemp farming, as well as the cultivation of low-THC oil. These people and entities will need financial services, and this federal bill will address a significant hurdle for credit unions and banks.
Regardless how one feels about legalizing medicinal or recreational cannabis, credit unions operating in states where this is legal have challenges. While the cannabis, hemp or low-THC oil may be legal, action on a federal level is necessary to clear up the issues surrounding their (and the people who work at these places) access to traditional depository and lending services. And that includes Georgia if and when the hemp and low-THC farming bills pass the state Legislature.
The SAFE Banking Act of 2019 would offer narrowly targeted federal protections for credit unions and other financial institutions accepting deposits, extending credit or providing payment services to an individual or business engaged in cannabis-related commerce in states where such activity is legal with a safe harbor, so long as they are compliant with all other applicable laws and regulations. Furthermore, the SAFE Banking Act provides safe harbor to credit unions and their employees who are not aware if their members or customers are involved in this business.
Financial institutions should be permitted to lawfully serve businesses that engage in activities that are authorized under their state laws, even when such activity may be inconsistent with federal law. Many credit unions operate in states where their voters or legislatures have made cannabis legal in one form or another, and Georgia is one that has serious bills moving presently that would expand. The SAFE Act (HR 1595) was agreed to by the House Financial Service Committee and reported favorably to the House 45-15. Both Rep. David Scott (D-13) and Rep. Barry Loudermilk (R-11) voted in favor of the legislation. The bill now awaits action by the House.
One of the other bills debated was H.R. 1500, the Consumer First Act. This bill was introduced by House Financial Services Chair Rep. Maxine Waters (D-CA) and its focus is to ensure that the CFPB meets its statutory duties. Over the last few years, Rep. David Scott (D-13) has been supportive of changing the CFPB structure from a single director to a commission and has even supported previous legislation that would have accomplished the change.
During consideration of legislation, Rep. Blaine Luetkemeyer (R-MO) offered an amendment that would create a bipartisan commission to lead the CFPB instead of a single director. So, after being asked by Rep. David Scott to do so and getting assurances from Chairwoman Waters that they would further discuss the issue, Rep. Luetkemeyer withdrew the amendment. A special thanks to Rep. Scott and his staff for working with us to ensure that the concept would be something the Chair would allow to be discussed in the future.