WASHINGTON, D.C. – Yesterday, Rep. Scott Peters (CA-52) voted to pass the SAFE Banking Act of 2021 to prohibit federal banking regulators from penalizing institutions for providing banking services to a legitimate cannabis-related business.
“Currently, law-abiding cannabis businesses take unnecessary risks to manage their revenues such as storing large amounts of cash in homes or stores,” said Rep. Peters. “Even if they manage to receive assistance from a banking institution, nothing shields either party from federal intervention.”
“Evolving state laws related to marijuana in recent years warrant an updated system to protect banks and the legitimate businesses they serve. The federal government must adapt its policies to catch up with local and state actions on cannabis,” he said.
Marijuana is currently illegal under federal law, though 15 states have legalized recreational use of marijuana and 20 states have legalized medical marijuana. The discrepancies between federal and state laws pose problems for some business owners as they operate in compliance with state law, while simultaneously violating federal law. Despite the continued growth of the marijuana industry, interaction with funds that can be traced back to state marijuana operations could be considered money laundering and expose a bank to legal, operational and regulatory risk.
The passage of the Control, Regulate and Tax Adult Use of Cannabis Act (Prop 64) in 2016 in California legalized recreational marijuana, and handed local governments the power to establish rules and ordinances on marijuana consumption and distribution. Since then, lawmakers and voters have navigated many changes in cannabis-related policy. Now, cities like San Diego count on established definitions and requirements for cannabis businesses, including cannabis outlets, production facilities and testing facilities among other outlined restrictions.
In addition to addressing the financial aspect of marijuana reform, Rep. Peters’ work in Congress includes the push to legalize cannabis federally and make a difference for people who have faced marijuana-related convictions. Last December, Rep. Peters voted to pass a historic marijuana reform bill, the bipartisan Marijuana Opportunity Reinvestment and Expungement (MORE) Act to decriminalize marijuana at the federal level and expunge all non-violent federal marijuana criminal offenses from an individual’s record.
Last year, Rep. Peters also uplifted the work of UC San Diego’s Center for Medicinal Cannabis Research, the longest-running clinical cannabis research center in the U.S, as he discussed the importance of expanded research into the therapeutic potential of cannabis.