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Justice with Jessica: Senate holds first hearing on cannabis banking bill

"SAFE Banking Act" would give cannabis industry access to traditional banking services if it passes
Cash money
Posted at 9:00 AM, May 12, 2023

WASHINGTON, D.C. — The U.S. Senate Banking Committee held a hearing Thursday on the Secure and Fair Enforcement (SAFE) Banking Act.

Click here to watch the hearing.

The SAFE Banking Act would give cannabis businesses access to traditional banking services.

Thursday's hearing allowed the committee to learn more information about the bill and hear from supporters and detractors.

The bill was introduced in the Senate in April, but lawmakers have considered similar bills in the past.

Denver7 has spoken with owners of local cannabis businesses about challenges they've faced in the banking industry.

Traditional banks generally refuse to work with cannabis businesses because marijuana is still federally illegal. For that reason, banks can face fines and legal problems if they work with marijuana businesses.

Without access to traditional banks, legal marijuana businesses struggle to access loans or even use basic bank accounts. That leads many of the businesses to use a cash-only model.

Supporters of the SAFE Banking Act say the cash-only model can make dispensaries targets for robberies.

"A lot of businesses that don't have banking abilities are stuck with a lot of cash on site," Clif Gordon, manager of the family-owned business Herban Underground, said.

Gordon explained that his business has been able to work with Colorado-based banks and credit unions to offer a safer option. "If we could take credit cards, I would guess that 70% to 80% of my business would be transacted electronically. We wouldn't have that cash, we wouldn't be at risk, because the money's just not there."

In Thursday's hearing, Ademola Oyefeso, UFCW Director of Legislative and Political Action, said that some banks in the country also refuse to serve cannabis employees.

"Cannabis workers struggle to purchase homes and often find themselves having to pay higher mortgage rates even though they work in a perfectly legal profession in their state," Oyefeso said.

Other witnesses argue that the bill is not needed because some small banks do work with cannabis businesses, even if traditional banks refuse.

"It purports to fix a fake problem," Kevin Sabet, President of Smart Approaches to Marijuana, said. "Today's marijuana businesses are not dealing primarily in cash. There are hundreds and hundreds of banks working with pot businesses."

While the bill is getting plenty of attention, it's still in the early stages of the legislative process.

It would still need to pass the Senate and House before heading to the president's desk.

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