The signs are good that people involved in the newly legalized cannabis industry in Michigan will have easier access to banking services than businesses in that industry ever had in the past. Michigan cannabis business banking seems poised to benefit from the coordinated efforts of powerful groups all over the country. The marijuana business generates large amounts of cash. This has made dispensaries and people involved in the cannabis industry the target of thieves and robbers. There is now a movement underway to allow banks to enable marijuana industry businesses to open bank accounts.
Old Anti-Marijuana Banking Laws Weakening
In the past, law makers, the federal government, the banking industry and the general public didn’t want marijuana money being placed in banks. But the opinions of people in most of those groups are changing. Allowing legal marijuana businesses to open bank accounts rather than keeping hundreds of thousands of dollars in their shops seems like the commonsense thing to do. It protects the safety of innocent people legally buying and selling medicinal and recreational marijuana from criminals enticed by the piles of cash stored in the cannabis shops and dispensaries all across the country. The law will greatly benefit people with marijuana businesses in Michigan.
The Secure And Fair Enforcement (SAFE) Banking Act
Oregon Senator Jeff Merkley has offered a legislative solution to the marijuana business banking problem. He has introduced the Secure And Fair Enforcement Banking Act, also known as the SAFE Banking Act. The bill, which a U.S. House of Representatives Financial Services subcommittee recently took up, is designed to protect banks and bank employees who do business with legal marijuana companies from being punished by the federal government. Colorado Senator Edward Perlmutter, who supports the bill, says the hearing is very important. Perlmutter has promoted similar legislation for many years.
The Specifics Of The Safe Act
The bill specifies that under federal law, a depository institution providing financial services to licensed cannabis-related businesses will not be held liable or be subject to forfeiture. Should this act become law, it will be great for legitimate marijuana industry businesses in Michigan. It would put them on a level footing with businesses in other industries. The bill would prevent federal banking regulators from limiting or terminating deposit insurance, discouraging banks from providing financial services and taking corrective action against financial institutions because they provide accounts for legal marijuana industry businesses.
Banks Open To Changes
Many banks and other financial institutions nationwide are in support of the proposed changes in the handling of marijuana business banking. For years the banking industry has asked legislators to address the issues without success. With two dozen states legalizing marijuana in some form, there’s added pressure for banking regulations related to marijuana businesses to change. Several banking groups considered the House hearing so momentous they held conference calls and sent out news releases. Small banks that had wanted to offer marijuana businesses accounts said they faced regulatory burdens and legal risks if they tried to serve this untapped market.
Preventing Murders And Robberies
The SAFE Banking Act’s co-sponsor, Washington state House representative Denny Heck, says changing the law will prevent armed robberies and murders. California’s state treasurer, Fiona Ma, told the House committee some of the state’s cannabis dispensaries have had to pay their taxes with suitcases and duffle bags filled with cash. She agreed the proposed changes would make the process safer and easier. Changes in the federal government’s banking laws related to marijuana businesses would be great news for people involved in Michigan’s legal marijuana industry. It would keep them safer by eliminating the temptation keeping large amounts of cash inside the marijuana shops hold for thieves and armed robbers.
Attorneys General Nationwide Back Changes
The National Association of Attorneys General supports changing the banking laws and urged congressional leadership in a letter to pass the Secure And Fair Enforcement Banking Act. The letter, signed by attorneys general from 38 states and territories, says the changes would protect public safety, which is in the interest of the state and federal government. The SAFE ACT would provide depository institutions with a ‘safe harbor’ and will enable law enforcement and tax agencies on the local, state and federal levels to monitor the billions of dollars in legal cannabis business transactions more effectively.
A More Flexible Banking System
Cash is the primary medium of exchange in the marijuana industry in Michigan and elsewhere in the country. For regulatory compliance and taxation purposes, this makes tracking revenues more difficult. The letter from the National Association of Attorneys General calls for a banking system that’s ‘flexible enough’ to serve marijuana-related businesses with input from the states while protecting the federal government’s interests. The NAAG letter implied the SAFE Banking Act would help the banking system to effectively and responsively meet the American economy’s demands in dealing with marijuana-related businesses
Republican Lawmakers Resistant
While in addition to bankers, the attorney’s general and marijuana business owners, the Law Enforcement Action Partnership supports the SAFE Banking Act, there’s some question about having the necessary political will to pass the bill. Some Republican committee members call making changes to the banking laws related to marijuana businesses ‘premature’. They say while marijuana remains illegal at the federal level, changing the banking laws to support marijuana businesses would send a confusing message to the general public. Legal Michigan cannabis business banking may have to wait a little longer.
Change Is Inevitable
While there remains some resistance to changing banking laws to give marijuana-related businesses access to accounts and other financial services, change is in the air. John Boehner, the former House speaker, is an example. While in office not long ago, he staunchly opposed legalizing marijuana. Today, he’s head of a lobbying group that’s pro-marijuana. Democratic presidential candidate Kamala Harris recently admitted using marijuana in the past. By the time Michigan’s new pro-marijuana laws take effect, marijuana business banking may be legal as well. This will allow for Michigan cannabis business banking to become commonplace.
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