First Subcommittee Hearing on Banking Services for Cannabis-Related Industries
Last week, Congress held its first-ever hearing on the issue of cannabis banking, entitled “Challenges and Solutions: Access to Banking Services for Cannabis-Related Businesses.” The hearing, which took place before the Subcommittee on Consumer Protection and Financial Institutions, addressed a draft of the Secure and Fair Enforcement Banking Act, or SAFE Banking Act, introduced by Congressman Ed Perlmutter (D-Colo.).
The SAFE Banking Act would:
- Provide a safe harbor for financial institutions to legally provide services to cannabis-related industries in states where cannabis has been legalized in some form
- Allow legal businesses to access financial services in states where cannabis has been legalized
- Address a void in banking that faces cannabis-related businesses and increase the number of banks providing financial services to these businesses
- Help prevent tax evasion, fraud, and public safety issues
CohnReznick does not take a position on federal cannabis legalization but supports any efforts to enable access to banking through the SAFE Banking Act. Access to the regulated banking industry will increase financial transparency and auditability. This should be of significant benefit to investors, regulators, and taxing authorities.
Related Services
-
InsightPerspective: New IRS ‘Marijuana Industry’ page offers useful resources, but few new insightsMichael HarlowWhile it is good to see the IRS acknowledging the marijuana industry and aggregating useful links, the page overall offers little new information. Read more.
-
InsightTop considerations in starting a cannabis-focused alternative investment fundMarc Wolf, Moshe Biderman, Cheryl Watson, Jeffrey MoskowitzFund managers looking to create cannabis-focused investment vehicles face specialized tax, operational, and regulatory considerations.
-
InsightLeak of 30,000 cannabis customer records heightens need for effective data securityIra WeinsteinBusinesses in the cannabis supply chain should fortify their systems and processes to comply with data privacy regulations. Here’s what to know.
-
InsightWayfair, a game changer for cannabisWhen you think of Wayfair, you might think of furniture and home goods, but Wayfair also has made its way into the cannabis sector. What’s the connection?