WASHINGTON, D.C. – The Residence Economic Solutions Committee on March 28 passed H.R. 1595, the Safe and Fair Enforcement Banking Act of 2019, or Protected Banking Act, which would let legal cannabis companies to access monetary institutions and typical merchant banking solutions. The proposed legislation passed on a 45 to 15 vote and now advances to the Residence floor.

“The Protected Banking Act is about public security, accountability, and respecting states’ rights,” Rep. Ed Perlmutter (D-CO) mentioned in a ready statement. “Our federal banking laws had been made to protect against illicit activity and support law enforcement do their jobs. These laws will need to be applied to reputable marijuana companies and personnel in order to enhance transparency and accountability and support root out illegal transactions.

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“Most importantly, the Protected Banking Act will get money off our streets, minimizing the danger of violent crime and generating our communities safer. Though Congress has stuck its head in the sand for several years, this committee has shown leadership on this challenge and I want to thank my cosponsors and members of the committee for their assistance,” he added.

Perlmutter, who co-authored the legislation with Rep. Denny Heck (D-WA), has been a stalwart campaigner for enabling reputable banking solutions for the cannabis business. He very first introduced a draft version of the act in 2013.

Cannabis companies have been mainly restricted to money-only transactions, which contain essential bank-facilitated merchant solutions like tax payment, home transactions, and payroll. Continuing U.S. federal prohibition of cannabis, with its status as an illegal Schedule I narcotic, causes monetary institutions to turn down cannabis-associated accounts due to the prospective for federal racketeering charges and other RICO violations.

“Given the hardships facing the cannabis business due to present monetary regulations, just developing a additional typical banking atmosphere by means of passage of the Protected Banking Act would certainly be a game-changer,” Morgan Fox, media relations director at trade nonprofit National Cannabis Sector Association (NCIA), told mg.

“There would nonetheless be additional function to be accomplished in this location, specifically relating to access to capital for little companies, and some banks could nonetheless balk at functioning with the cannabis business till prohibition ends at the federal level, but this reform would be a giant step in the appropriate path,” Fox continued.

The most up-to-date version of the Protected Banking Act, according to Perlmutter, “adds protection for ancillary companies like genuine estate owners, accountants, and other vendors from revenue laundering and other laws as properly as adjusts the tribal language and the definition of ‘cannabis-associated reputable enterprise.’ The final version of H.R. 1595 voted on in committee also contains two provisions aimed at expanding access to monetary solutions for minority-owned and girls-owned cannabis-associated companies.”

Photo: Mark Reinstein/Shutterstock

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