PHOENIX – Attorney General Mayes and 22 other attorneys general this week urged Congress to pass the SAFER Banking Act of 2023. The act aims to remove banking restrictions that impede state-licensed cannabis businesses from accessing regulated financial services.
Despite the growing number of states that have legally authorized and regulated cannabis businesses, federal law still classifies cannabis as an illegal substance. This classification puts banks at risk of criminal and civil liability when servicing state-licensed cannabis businesses. Financial institutions are then deterred from extending services to these enterprises, causing difficulties in securing financing. Current restrictions also make it challenging for state agencies to collect taxes and oversee businesses effectively. Additionally, the restrictions increase public safety risks, as businesses dealing exclusively in cash can become targets for violent crimes.
"The SAFER Banking Act will help stabilize a rapidly growing industry already contributing significantly to Arizona's economy," said Attorney General Mayes. "The passage of this legislation will reduce public safety risks and enable more effective financial oversight of cannabis businesses."
The Attorneys General argue that passage of the SAFER Banking Act, which will enable regulated banks and financial institutions to provide services to state-licensed cannabis businesses, will enable economic growth, facilitate state oversight of tax obligations, and reduce the public safety risks associated with high-value, cash-based businesses. The SAFER Banking Act would establish a safe harbor for depository institutions providing a financial product or service to a regulated business in states that have regulations to ensure accountability in the cannabis industry.
The Attorneys General also argue that an effective safe harbor would bring billions of dollars into the banking sector, enabling law enforcement, federal, state, and local tax agencies, and cannabis regulators in thirty-eight states and several territories to more effectively monitor and ensure compliance of cannabis businesses and their transactions.
The bipartisan coalition joined by Attorney General Mayes is led by Maryland, Washington D.C., and Oklahoma. The Attorneys General of California, Colorado, Connecticut, Georgia, Hawaii, Illinois, Massachusetts, Maine, Michigan, New Jersey, New Mexico, Nevada, New York, Oregon, Pennsylvania, Rhode Island, Vermont, and Washington also joined.