U.S. Sen. Bob Menendez introduced the Secure and Fair Enforcement Banking Act on Thursday to enable legal cannabis businesses to access banking services.
Currently, legal cannabis businesses can be denied access to the banking system because banks can be prosecuted under federal law. Cannabis remains a federally scheduled substance, even in states where it is medically or recreationally legal.
“The fact is, we already have legal medical marijuana businesses in New Jersey,” said Menendez in a prepared statement. “What they don’t have are bank services to pay employees, take credit cards, write checks or pay taxes. Instead, they’re forced to operate entirely in cash — large sums — an open invitation for robbery and crime. We can fix this with common sense legislation that simply allows banks and credit unions to service these legitimate, legal enterprises without risk of federal prosecution.”
Menendez plans to introduce separate legislation to allow insurance companies to provide services to legal cannabis businesses, which are frequently barred from getting property, fire, flood, and liability insurance.
“Legal marijuana businesses don’t just need banking services, they need insurance in order to operate and seek financing, and insurers need the green light to participate in this emerging market,” he said.
The SAFE Banking Act protects banks and credit unions by preventing federal regulators from penalizing or discouraging them from providing financial services to regulated cannabis businesses. However, it does not require banks or credit unions to provide services to them.