Explaination of H.R. 1595

Explanation of H.R. 1595

This bill, also known as the "Secure and Fair Enforcement Banking Act of 2019" or the "SAFE Banking Act of 2019," aims to protect depository institutions (such as banks and credit unions) that provide financial services to cannabis-related legitimate businesses and service providers.

The purpose of this bill is to increase public safety by allowing cannabis businesses to have access to financial services, reducing the amount of cash they have on hand. Currently, many cannabis businesses operate on a cash-only basis because they are unable to access banking services due to the federal illegality of cannabis.

Specifically, this bill prohibits federal banking regulators from terminating or limiting the insurance coverage of a depository institution solely because it provides financial services to a cannabis-related legitimate business. It also prohibits regulators from discouraging or penalizing depository institutions from providing financial services to these businesses. Additionally, it protects depository institutions from adverse action based on providing financial services to cannabis-related businesses or individuals associated with those businesses.

The bill also provides safe harbor protection for depository institutions that provide financial services to cannabis-related legitimate businesses. It defines "cannabis-related legitimate business" as a business that engages in activities related to cannabis that are legal under state or local laws.

Moreover, the bill requires the Financial Institutions Examination Council to develop guidance and examination procedures for depository institutions that provide financial services to cannabis-related businesses and service providers.

The bill also includes provisions relating to the insurance industry, reporting requirements for suspicious activity, and protections for hemp businesses following the legalization of hemp in the Agriculture Improvement Act of 2018.

Overall, the bill aims to provide protections and access to financial services for cannabis-related legitimate businesses, reduce the reliance on cash in the industry, and increase public safety.

Rep. Veronica Escobar

Stats

Sponsored Legislation