Legislators Seek to Bring Marijuana Money out of the Shadows

Federal banking regulations threaten banks serving legal marijuana sector
Wednesday, May 15, 2019

LANSING — State Rep. Yousef Rabhi (D-Ann Arbor), State Rep. Jim Lilly (R-Park Township), State Rep. Sherry Gay-Dagnogo (D-Detroit) and State Sen. Curtis Hertel, Jr. (D-East Lansing) introduced legislation Tuesday calling on Congress to prevent federal regulators from penalizing financial institutions that handle marijuana-related transactions legal under state law. House Resolution 101 and Senate Concurrent Resolution 9 urge the swift passage of the federal Secure and Fair Enforcement (SAFE) Banking Act of 2019. Lawmakers announced the legislation at a Tuesday press conference held at the Michigan Bankers Association. Representatives of Michigan Cannabis Industry Association also attended to support the resolutions.

“The people of Michigan overwhelmingly voted to legalize medical marijuana and adult use of marijuana,” Rep. Rabhi said. “But it’s hard to maintain a safe, well-regulated, and taxed marijuana industry when they are forced to run a cash-only business. It’s in the public interest to let them use banks and credit unions like everyone else.”

“By forcing entrepreneurs in this space to operate on an all cash basis, we are unnecessarily creating public safety hazards,” Rep. Lilly said. “Our current system simply isn’t working. Regardless of your views on marijuana, there are no good arguments for encouraging the industry’s financial operations to exist in the shadows.”

“Public safety should be our number one priority as legislation has been passed to allow for medical and recreational marijuana usage in the State of Michigan. We need to remove the federal restrictions so that these businesses can operate safely in our communities,” Rep. Sherry Gay-Dagnogo, Vice Chair of the House Financial Services Committee said. “Unfortunately, the mandatory reliance on cash has made our neighborhoods targets for robberies. The sooner we fix this broken policy, the better.”

“It doesn’t make sense to treat legal, regulated businesses like illicit drug dealers,” Sen. Hertel said. “These folks are just trying to run a business and pay their taxes, but federal banking regulations are getting in the way. For the sake of public safety and accountability, Congress needs to give legal marijuana businesses access to the banking system.”

"Michigan cannabis businesses operate in a legal, highly regulated industry. They deserve to have accesses to the same banking opportunities as any other business in this state," said Michigan Cannabis Industry Association Executive Director Robin Schneider.  "We have 33 states with medical marijuana and 10 states plus D.C. that allow full adult-use legalization. It's time for Congress to pass the SAFE Banking Act."

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