Secure and Fair Enforcement Banking Act of 2019 or the SAFE Banking Act of 2019
This bill generally prohibits a federal banking regulator from penalizing a depository institution for providing banking services to a legitimate marijuana- or hemp-related business. Specifically, the bill prohibits a federal banking regulator from (1) terminating or limiting the deposit insurance or share insurance of a depository institution solely because the institution provides financial services to a legitimate marijuana- or hemp-related business; (2) prohibiting or otherwise discouraging a depository institution from offering financial services to such a business; (3) recommending, incentivizing, or encouraging a depository institution not to offer financial services to an account holder solely because the account holder is affiliated with such a business; (4) taking any adverse or corrective supervisory action on a loan made to a person solely because the person either owns such a business or owns real estate or equipment leased or sold to such a business; or (5) penalizing a depository institution for engaging in a financial service for such a business.
As specified by the bill, a depository institution, a Federal Reserve bank, or an insurer shall not, under federal law, be liable or subject to forfeiture for providing a loan or other financial services to a legitimate marijuana- or hemp-related business.
The bill specifies that a federal banking agency may not request or order a depository institution to terminate a customer account unless (1) the agency has a valid reason for doing so, and (2) that reason is not based solely on reputation risk. Valid reasons for terminating an account include threats to national security and involvement in terrorist financing, including state sponsorship of terrorism.
The Government Accountability Office must report on (1) access to financial services for minority-owned and women-owned marijuana- or hemp-related businesses; and (2) the effectiveness of suspicious-transaction reports at finding engagement with organized criminal activity in jurisdictions that allow the cultivation, sale, or distribution of marijuana.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1595 Introduced in House (IH)]
<DOC>
116th CONGRESS
1st Session
H. R. 1595
To create protections for depository institutions that provide
financial services to cannabis-related legitimate businesses and
service providers for such businesses, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 7, 2019
Mr. Perlmutter (for himself, Mr. Heck, Mr. Stivers, Mr. Davidson of
Ohio, Mr. Aguilar, Ms. Barragan, Mr. Beyer, Mr. Blumenauer, Ms.
Bonamici, Mr. Brendan F. Boyle of Pennsylvania, Mr. Brown of Maryland,
Ms. Brownley of California, Mr. Carbajal, Mr. Cardenas, Mr. Cartwright,
Ms. Castor of Florida, Mr. Cicilline, Mr. Cisneros, Ms. Clark of
Massachusetts, Ms. Clarke of New York, Mr. Cohen, Mr. Cooper, Mr.
Correa, Mr. Courtney, Mr. Cox of California, Mr. Crist, Mr. Crow, Mrs.
Davis of California, Mr. DeFazio, Ms. DeGette, Ms. DeLauro, Ms.
DelBene, Mr. DeSaulnier, Ms. Eshoo, Mr. Espaillat, Mr. Foster, Ms.
Fudge, Ms. Gabbard, Mr. Gallego, Mr. Garcia of Illinois, Mr. Gomez, Mr.
Gonzalez of Texas, Mr. Hastings, Ms. Hill of California, Mr. Horsford,
Mr. Huffman, Ms. Jackson Lee, Ms. Jayapal, Mr. Johnson of Georgia, Mr.
Khanna, Mr. Kilmer, Mrs. Kirkpatrick, Mr. Krishnamoorthi, Mr. Lawson of
Florida, Ms. Lee of California, Mrs. Lee of Nevada, Mr. Levin of
Michigan, Mr. Levin of California, Mr. Ted Lieu of California, Mr.
Lujan, Ms. Matsui, Ms. McCollum, Mr. McGovern, Mr. Meeks, Mr. Neguse,
Ms. Norton, Mr. Panetta, Mr. Pappas, Ms. Pingree, Ms. Porter, Mr.
Quigley, Mr. Raskin, Mr. Rush, Mr. Ryan, Mr. Rouda, Ms. Schakowsky, Mr.
Schrader, Mr. Sherman, Mr. Sires, Mr. Smith of Washington, Mr. Soto,
Ms. Speier, Mr. Swalwell of California, Ms. Titus, Mrs. Torres of
California, Mr. Vargas, Ms. Velazquez, Mrs. Watson Coleman, Mr. Welch,
Ms. Wild, Mr. Yarmuth, Mr. Rodney Davis of Illinois, Mr. Hunter, Mr.
Joyce of Ohio, Mr. Newhouse, Mr. Young, Mr. Himes, Mr. Loebsack, Ms.
Lofgren, Mr. Lowenthal, Mrs. Carolyn B. Maloney of New York, Mr. Sean
Patrick Maloney of New York, Mr. Takano, Mr. Thompson of California,
Mr. Gaetz, Mr. Riggleman, Mr. David Scott of Georgia, Ms. Waters, and
Ms. Schrier) introduced the following bill; which was referred to the
Committee on Financial Services, and in addition to the Committee on
the Judiciary, for a period to be subsequently determined by the
Speaker, in each case for consideration of such provisions as fall
within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To create protections for depository institutions that provide
financial services to cannabis-related legitimate businesses and
service providers for such businesses, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; PURPOSE.
(a) Short Title.--This Act may be cited as the ``Secure And Fair
Enforcement Banking Act of 2019'' or the ``SAFE Banking Act of 2019''.
(b) Purpose.--The purpose of this Act is to increase public safety
by expanding financial services to cannabis-related legitimate
businesses and service providers and reducing the amount of cash at
such businesses.
SEC. 2. SAFE HARBOR FOR DEPOSITORY INSTITUTIONS.
A Federal banking regulator may not--
(1) terminate or limit the deposit insurance or share
insurance of a depository institution under the Federal Deposit
Insurance Act (12 U.S.C. 1811 et seq.), the Federal Credit
Union Act (12 U.S.C. 1751 et seq.), or take any other adverse
action against a depository institution under section 8 of the
Federal Deposit Insurance Act (12 U.S.C. 1818) solely because
the depository institution provides or has provided financial
services to a cannabis-related legitimate business or service
provider;
(2) prohibit, penalize, or otherwise discourage a
depository institution from providing financial services to a
cannabis-related legitimate business or service provider or to
a State, political subdivision of a State, or Indian Tribe that
exercises jurisdiction over cannabis-related legitimate
businesses;
(3) recommend, incentivize, or encourage a depository
institution not to offer financial services to an account
holder, or to downgrade or cancel the financial services
offered to an account holder solely because--
(A) the account holder is a cannabis-related
legitimate business or service provider, or is an
employee, owner, or operator of a cannabis-related
legitimate business or service provider;
(B) the account holder later becomes an employee,
owner, or operator of a cannabis-related legitimate
business or service provider; or
(C) the depository institution was not aware that
the account holder is an employee, owner, or operator
of a cannabis-related legitimate business or service
provider;
(4) take any adverse or corrective supervisory action on a
loan made to--
(A) a cannabis-related legitimate business or
service provider, solely because the business is a
cannabis-related legitimate business or service
provider;
(B) an employee, owner, or operator of a cannabis-
related legitimate business or service provider, solely
because the employee, owner, or operator is employed
by, owns, or operates a cannabis-related legitimate
business or service provider, as applicable; or
(C) an owner or operator of real estate or
equipment that is leased to a cannabis-related
legitimate business or service provider, solely because
the owner or operator of the real estate or equipment
leased the equipment or real estate to a cannabis-
related legitimate business or service provider, as
applicable; and
(5) prohibit or penalize a depository institution, or
entity performing services for the depository institution, for,
or otherwise discourage a depository institution, or entity
performing services for the depository institution, from,
authorizing, processing, clearing, settling, billing,
transferring, reconciling, or collecting payments for a
cannabis-related legitimate business, where such payment is
made by any means, including a credit, debit, or other payment
card, an account, check, or electronic funds transfer.
SEC. 3. PROTECTIONS FOR ANCILLARY BUSINESSES.
For purposes of sections 1956 and 1957 of title 18, United States
Code, and all other provisions of Federal law, the proceeds from a
transaction conducted by a cannabis-related legitimate business or
service provider shall not be considered as proceeds from an unlawful
activity solely because the transaction was conducted by a cannabis-
related legitimate business or service provider, as applicable.
SEC. 4. PROTECTIONS UNDER FEDERAL LAW.
(a) In General.--With respect to providing financial services
within a State, political subdivision of a State, or Indian country
that allows the cultivation, production, manufacture, sale,
transportation, display, dispensing, distribution, or purchase of
cannabis pursuant to a law or regulation of such State, political
subdivision, or Indian Tribe that has jurisdiction over the Indian
country, as applicable, a depository institution that provides
financial services to a cannabis-related legitimate business or service
provider, and the officers, directors, and employees of that depository
institution may not be held liable pursuant to any Federal law or
regulation--
(1) solely for providing such financial services; or
(2) for further investing any income derived from such
financial services.
(b) Forfeiture.--A depository institution that has a legal interest
in the collateral for a loan or another financial service provided to
an owner or operator of a cannabis-related legitimate business or
service provider, or to an owner or operator of real estate or
equipment that is leased or sold to a cannabis-related legitimate
business or service provider, shall not be subject to criminal, civil,
or administrative forfeiture of that legal interest pursuant to any
Federal law for providing such loan or other financial service.
SEC. 5. RULE OF CONSTRUCTION.
Nothing in this Act shall require a depository institution to
provide financial services to a cannabis-related legitimate business or
service provider.
SEC. 6. REQUIREMENTS FOR FILING SUSPICIOUS ACTIVITY REPORTS.
Section 5318(g) of title 31, United States Code, is amended by
adding at the end the following:
``(5) Requirements for cannabis-related legitimate
businesses.--
``(A) In general.--With respect to a financial
institution or any director, officer, employee, or
agent of a financial institution that reports a
suspicious transaction pursuant to this subsection, if
the reason for the report relates to a cannabis-related
legitimate business or service provider, the report
shall comply with appropriate guidance issued by the
Financial Crimes Enforcement Network. The Secretary
shall ensure that the guidance is consistent with the
purpose and intent of the SAFE Banking Act of 2019 and
does not significantly inhibit the provision of
financial services to a cannabis-related legitimate
business or service provider in a State, political
subdivision of a State, or Indian country that has
allowed the cultivation, production, manufacture,
transportation, display, dispensing, distribution,
sale, or purchase of cannabis pursuant to law or
regulation of such State, political subdivision, or
Indian Tribe that has jurisdiction over the Indian
country.
``(B) Definitions.--For purposes of this paragraph:
``(i) Cannabis.--The term `cannabis' has
the meaning given the term `marihuana' in
section 102 of the Controlled Substances Act
(21 U.S.C. 802).
``(ii) Cannabis-related legitimate
business.--The term `cannabis-related
legitimate business' has the meaning given that
term in section 8 of the SAFE Banking Act of
2019.
``(iii) Indian country.--The term `Indian
country' has the meaning given that term in
section 1151 of title 18.
``(iv) Indian tribe.--The term `Indian
Tribe' has the meaning given that term in
section 102 of the Federally Recognized Indian
Tribe List Act of 1994 (25 U.S.C. 479a).
``(v) Financial service.--The term
`financial service' means a financial product
or service as defined in section 1002 of the
Dodd-Frank Wall Street Reform and Consumer
Protection Act (12 U.S.C. 5481).
``(vi) Service provider.--The term `service
provider' has the meaning given that term in
section 8 of the SAFE Banking Act of 2019.
``(vii) State.--The term `State' means each
of the several States, the District of
Columbia, Puerto Rico, and any territory or
possession of the United States.''.
SEC. 7. GUIDANCE AND EXAMINATION PROCEDURES.
(a) In General.--Not later than 180 days after the date of
enactment of this Act, the Financial Institutions Examination Council
shall develop uniform guidance and examination procedures for
depository institutions that provide financial services to cannabis-
related legitimate businesses and service providers.
(b) Issuance by Federal Banking Regulators.--The Federal banking
regulators shall each issue guidance and examination procedures for
depository institutions that provide financial services to cannabis-
related legitimate businesses and service providers that are consistent
with the uniform guidance and examination procedures developed under
subsection (a).
SEC. 8. DEFINITIONS.
In this Act:
(1) Cannabis.--The term ``cannabis'' has the meaning given
the term ``marihuana'' in section 102 of the Controlled
Substances Act (21 U.S.C. 802).
(2) Cannabis product.--The term ``cannabis product'' means
any article which contains cannabis, including an article which
is a concentrate, an edible, a tincture, a cannabis-infused
product, or a topical.
(3) Cannabis-related legitimate business.--The term
``cannabis-related legitimate business'' means a manufacturer,
producer, or any person or company that--
(A) engages in any activity described in
subparagraph (B) pursuant to a law established by a
State or a political subdivision of a State, as
determined by such State or political subdivision; and
(B) participates in any business or organized
activity that involves handling cannabis or cannabis
products, including cultivating, producing,
manufacturing, selling, transporting, displaying,
dispensing, distributing, or purchasing cannabis or
cannabis products.
(4) Depository institution.--The term ``depository
institution'' means--
(A) a depository institution as defined in section
3(c) of the Federal Deposit Insurance Act (12 U.S.C.
1813(c));
(B) a Federal credit union as defined in section
101 of the Federal Credit Union Act (12 U.S.C. 1752);
or
(C) a State credit union as defined in section 101
of the Federal Credit Union Act (12 U.S.C. 1752).
(5) Federal banking regulator.--The term ``Federal banking
regulator'' means each of the Board of Governors of the Federal
Reserve System, the Bureau of Consumer Financial Protection,
the Federal Deposit Insurance Corporation, the Office of the
Comptroller of the Currency, the National Credit Union
Administration, or any Federal agency or department that
regulates banking or financial services, as determined by the
Secretary of the Treasury.
(6) Financial service.--The term ``financial service''
means a financial product or service as defined in section 1002
of the Dodd-Frank Wall Street Reform and Consumer Protection
Act (12 U.S.C. 5481).
(7) Indian country.--The term ``Indian country'' has the
meaning given that term in section 1151 of title 18.
(8) Indian tribe.--The term ``Indian Tribe'' has the
meaning given that term in section 102 of the Federally
Recognized Indian Tribe List Act of 1994 (25 U.S.C. 479a).
(9) Manufacturer.--The term ``manufacturer'' means a person
who manufactures, compounds, converts, processes, prepares, or
packages cannabis or cannabis products.
(10) Producer.--The term ``producer'' means a person who
plants, cultivates, harvests, or in any way facilitates the
natural growth of cannabis.
(11) Service provider.--The term ``service provider''--
(A) means a business, organization, or other person
that--
(i) sells goods or services to a cannabis-
related legitimate business; or
(ii) provides any business services,
including the sale or lease of real or any
other property, legal or other licensed
services, or any other ancillary service,
relating to cannabis; and
(B) does not include a business, organization, or
other person that participates in any business or
organized activity that involves handling cannabis or
cannabis products, including cultivating, producing,
manufacturing, selling, transporting, displaying,
dispensing, distributing, or purchasing cannabis or
cannabis products.
(12) State.--The term ``State'' means each of the several
States, the District of Columbia, Puerto Rico, and any
territory or possession of the United States.
<all>
Introduced in House
Referred to the Committee on Financial Services, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Financial Services, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Committee Consideration and Mark-up Session Held.
Committee Consideration and Mark-up Session Held.
Committee Consideration and Mark-up Session Held.
Ordered to be Reported (Amended) by the Yeas and Nays: 45 - 15.
Referred to the Subcommittee on Crime, Terrorism, and Homeland Security.
Reported (Amended) by the Committee on Financial Services. H. Rept. 116-104, Part I.
Reported (Amended) by the Committee on Financial Services. H. Rept. 116-104, Part I.
Committee on the Judiciary discharged.
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Committee on the Judiciary discharged.
Placed on the Union Calendar, Calendar No. 78.
Mr. Perlmutter moved to suspend the rules and pass the bill, as amended.
Considered under suspension of the rules. (consideration: CR H7962-7974)
DEBATE - The House proceeded with forty minutes of debate on H.R. 1595.
Passed/agreed to in House: On motion to suspend the rules and pass the bill, as amended Agreed to by the Yeas and Nays: (2/3 required): 321 - 103 (Roll no. 544).(text: CR H7962-7964)
Roll Call #544 (House)On motion to suspend the rules and pass the bill, as amended Agreed to by the Yeas and Nays: (2/3 required): 321 - 103 (Roll no. 544). (text: CR H7962-7964)
Roll Call #544 (House)Motion to reconsider laid on the table Agreed to without objection.
Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.