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Crapo seeks input on marijuana banking legislation
Following House passage earlier this year of a bill that would provide a safe harbor for credit unions and other lenders that serve marijuana-related businesses (MRBs) in states that have legalized the drug, Senate Banking Committee Chairman Mike Crapo, R-Idaho, is seeking "public feedback on ways to address public health and money laundering concerns with cannabis banking."
NAFCU has encouraged Congress to consider legislative complexities as several states have legalized marijuana, noting the benefits of a strong safe harbor for financial institutions that wish to serve MRBs. While NAFCU has not and will not take a position on the legalization or decriminalization of marijuana, the association has a number of resources – in addition to an updated issue brief – including a pros and cons document and Compliance Blog, and has explored the issue in its monthly Compliance Monitor newsletter and bimonthly magazine.
In a release, Crapo outlined a number of concerns he has with marijuana legalization and the House-passed SAFE Banking Act. He specifically noted five issues and provided options to address them, including:
- adding public health and safety solutions as a requirement for banks to do business with legally-operating state cannabis companies;
- preventing bad actors and cartels from using legacy cash and the financial system to disguise ill-gotten cash or launder money;
- updating 2014 Financial Crimes Enforcement Network (FinCEN) rulemaking and guidance related to MRBs;
- respecting state rights in interstate commerce and banking for institutions that operate in multiple states with different state rules; and
- eliminating "Operation Choke Point" and preventing future "Operation Choke Point" initiatives.
Relatedly, earlier this week a group of senators, including Crapo, introduced legislation – S. 3003 – that would prohibit "Operation Choke Point" policies; NAFCU has also opposed such policies that are used by regulators to keep financial services away from a member without a material reason.
Those interested in providing feedback to Crapo can submit comments to submissions@banking.senate.gov. The committee also explored the issue during a hearing in July.
The association will continue to monitor congressional efforts in this space and keep credit unions informed of any developments.