IIB 

117TH CONGRESS 

1ST SESSION H. R. 1996 

IN THE SENATE OF THE UNITED STATES 

APRIL 20, 2021 

Received; read twice and referred to the Committee on Banking, Housing, and 

Urban Affairs 

AN ACT 

To create protections for financial institutions that provide 

financial services to cannabis-related legitimate businesses and service providers for such businesses, and 

for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 


pamtmann on DSKBC07HB2PROD with BILLS
2 

HR 1996 RFS

1 SECTION 1. SHORT TITLE; TABLE OF CONTENTS; PURPOSE. 

2 (a) SHORT TITLE.—This Act may be cited as the 

3 ‘‘Secure And Fair Enforcement Banking Act of 2021’’ or 

4 the ‘‘SAFE Banking Act of 2021’’. 

5 (b) TABLE OF CONTENTS.—The table of contents for 

6 this Act is as follows: 

Sec. 1. Short title; table of contents; purpose. 

Sec. 2. Safe harbor for depository institutions. 

Sec. 3. Protections for ancillary businesses. 

Sec. 4. Protections under Federal law. 

Sec. 5. Rules of construction. 

Sec. 6. Requirements for filing suspicious activity reports. 

Sec. 7. Guidance and examination procedures. 

Sec. 8. Annual diversity and inclusion report. 

Sec. 9. GAO study on diversity and inclusion. 

Sec. 10. GAO study on effectiveness of certain reports on finding certain persons. 

Sec. 11. Application of this Act with respect to hemp-related legitimate businesses and hemp-related service providers. 

Sec. 12. Banking services for hemp-related legitimate businesses and hemp-related service providers. 

Sec. 13. Requirements for deposit account termination requests and orders. 

Sec. 14. Definitions. 

Sec. 15. Discretionary surplus funds. 

7 (c) PURPOSE.—The purpose of this Act is to increase 

8 public safety by ensuring access to financial services to 

9 cannabis-related legitimate businesses and service pro10 viders and reducing the amount of cash at such busi11 nesses. 

12 SEC. 2. SAFE HARBOR FOR DEPOSITORY INSTITUTIONS. 

13 (a) IN GENERAL.—A Federal banking regulator may 

14 not— 

15 (1) terminate or limit the deposit insur16 ance or share insurance of a depository institu17 tion under the Federal Deposit Insurance Act 


pamtmann on DSKBC07HB2PROD with BILLS
3 

HR 1996 RFS

1 (12 U.S.C. 1811 et seq.), the Federal Credit 

2 Union Act (12 U.S.C. 1751 et seq.), or take 

3 any other adverse action against a depository 

4 institution under section 8 of the Federal De5 posit Insurance Act (12 U.S.C. 1818) solely be6 cause the depository institution provides or has 

7 provided financial services to a cannabis-related 

8 legitimate business or service provider; 

9 (2) prohibit, penalize, or otherwise discour10 age a depository institution from providing fi11 nancial services to a cannabis-related legitimate 

12 business or service provider or to a State, polit13 ical subdivision of a State, or Indian Tribe that 

14 exercises jurisdiction over cannabis-related le15 gitimate businesses; 

16 (3) recommend, incentivize, or encourage a 

17 depository institution not to offer financial serv18 ices to an account holder, or to downgrade or 

19 cancel the financial services offered to an ac20 count holder solely because— 

21 (A) the account holder is a cannabis22 related legitimate business or service pro23 vider, or is an employee, owner, or oper24 ator of a cannabis-related legitimate busi25 ness or service provider; 


pamtmann on DSKBC07HB2PROD with BILLS
4 

HR 1996 RFS

1 (B) the account holder later becomes 

2 an employee, owner, or operator of a can3 nabis-related legitimate business or service 

4 provider; or 

5 (C) the depository institution was not 

6 aware that the account holder is an em7 ployee, owner, or operator of a cannabis-re8 lated legitimate business or service pro9 vider; 

10 (4) take any adverse or corrective super11 visory action on a loan made to— 

12 (A) a cannabis-related legitimate busi13 ness or service provider, solely because the 

14 business is a cannabis-related legitimate 

15 business or service provider; 

16 (B) an employee, owner, or operator 

17 of a cannabis-related legitimate business or 

18 service provider, solely because the em19 ployee, owner, or operator is employed by, 

20 owns, or operates a cannabis-related legiti21 mate business or service provider, as appli22 cable; or 

23 (C) an owner or operator of real es24 tate or equipment that is leased to a can25 nabis-related legitimate business or service 


pamtmann on DSKBC07HB2PROD with BILLS
5 

HR 1996 RFS

1 provider, solely because the owner or oper2 ator of the real estate or equipment leased 

3 the equipment or real estate to a cannabis4 related legitimate business or service pro5 vider, as applicable; or 

6 (5) prohibit or penalize a depository insti7 tution (or entity performing a financial service 

8 for or in association with a depository institu9 tion) for, or otherwise discourage a depository 

10 institution (or entity performing a financial 

11 service for or in association with a depository 

12 institution) from, engaging in a financial service 

13 for a cannabis-related legitimate business or 

14 service provider. 

15 (b) SAFE HARBOR APPLICABLE TO DE NOVO INSTI16 TUTIONS.—Subsection (a) shall apply to an institution ap17 plying for a depository institution charter to the same ex18 tent as such subsection applies to a depository institution. 

19 SEC. 3. PROTECTIONS FOR ANCILLARY BUSINESSES. 

20 For the purposes of sections 1956 and 1957 of title 

21 18, United States Code, and all other provisions of Fed22 eral law, the proceeds from a transaction involving activi23 ties of a cannabis-related legitimate business or service 

24 provider shall not be considered proceeds from an unlawful 

25 activity solely because— 


pamtmann on DSKBC07HB2PROD with BILLS
6 

HR 1996 RFS

1 (1) the transaction involves proceeds from a 

2 cannabis-related legitimate business or service pro3 vider; or 

4 (2) the transaction involves proceeds from— 

5 (A) cannabis-related activities described in 

6 section 14(4)(B) conducted by a cannabis-re7 lated legitimate business; or 

8 (B) activities described in section 

9 14(13)(A) conducted by a service provider. 

10 SEC. 4. PROTECTIONS UNDER FEDERAL LAW. 

11 (a) IN GENERAL.—With respect to providing a finan12 cial service to a cannabis-related legitimate business 

13 (where such cannabis-related legitimate business operates 

14 within a State, political subdivision of a State, or Indian 

15 country that allows the cultivation, production, manufac16 ture, sale, transportation, display, dispensing, distribution, 

17 or purchase of cannabis pursuant to a law or regulation 

18 of such State, political subdivision, or Indian Tribe that 

19 has jurisdiction over the Indian country, as applicable) or 

20 a service provider (wherever located), a depository institu21 tion, entity performing a financial service for or in associa22 tion with a depository institution, or insurer that provides 

23 a financial service to a cannabis-related legitimate busi24 ness or service provider, and the officers, directors, and 

25 employees of that depository institution, entity, or insurer 


pamtmann on DSKBC07HB2PROD with BILLS
7 

HR 1996 RFS

1 may not be held liable pursuant to any Federal law or 

2 regulation— 

3 (1) solely for providing such a financial service; 

4 or 

5 (2) for further investing any income derived 

6 from such a financial service. 

7 (b) PROTECTIONS FOR FEDERAL RESERVE BANKS

8 AND FEDERAL HOME LOAN BANKS.—With respect to 

9 providing a service to a depository institution that pro10 vides a financial service to a cannabis-related legitimate 

11 business (where such cannabis-related legitimate business 

12 operates within a State, political subdivision of a State, 

13 or Indian country that allows the cultivation, production, 

14 manufacture, sale, transportation, display, dispensing, dis15 tribution, or purchase of cannabis pursuant to a law or 

16 regulation of such State, political subdivision, or Indian 

17 Tribe that has jurisdiction over the Indian country, as ap18 plicable) or service provider (wherever located), a Federal 

19 reserve bank or Federal Home Loan Bank, and the offi20 cers, directors, and employees of the Federal reserve bank 

21 or Federal Home Loan Bank, may not be held liable pur22 suant to any Federal law or regulation— 

23 (1) solely for providing such a service; or 

24 (2) for further investing any income derived 

25 from such a service. 


pamtmann on DSKBC07HB2PROD with BILLS
8 

HR 1996 RFS

1 (c) PROTECTIONS FOR INSURERS.—With respect to 

2 engaging in the business of insurance within a State, polit3 ical subdivision of a State, or Indian country that allows 

4 the cultivation, production, manufacture, sale, transpor5 tation, display, dispensing, distribution, or purchase of 

6 cannabis pursuant to a law or regulation of such State, 

7 political subdivision, or Indian Tribe that has jurisdiction 

8 over the Indian country, as applicable, an insurer that en9 gages in the business of insurance with a cannabis-related 

10 legitimate business or service provider or who otherwise 

11 engages with a person in a transaction permissible under 

12 State law related to cannabis, and the officers, directors, 

13 and employees of that insurer may not be held liable pur14 suant to any Federal law or regulation— 

15 (1) solely for engaging in the business of insur16 ance; or 

17 (2) for further investing any income derived 

18 from the business of insurance. 

19 (d) FORFEITURE.— 

20 (1) DEPOSITORY INSTITUTIONS.—A depository 

21 institution that has a legal interest in the collateral 

22 for a loan or another financial service provided to an 

23 owner, employee, or operator of a cannabis-related 

24 legitimate business or service provider, or to an 

25 owner or operator of real estate or equipment that 


pamtmann on DSKBC07HB2PROD with BILLS
9 

HR 1996 RFS

1 is leased or sold to a cannabis-related legitimate 

2 business or service provider, shall not be subject to 

3 criminal, civil, or administrative forfeiture of that 

4 legal interest pursuant to any Federal law for pro5 viding such loan or other financial service. 

6 (2) FEDERAL RESERVE BANKS AND FEDERAL

7 HOME LOAN BANKS.—A Federal reserve bank or 

8 Federal Home Loan Bank that has a legal interest 

9 in the collateral for a loan or another financial serv10 ice provided to a depository institution that provides 

11 a financial service to a cannabis-related legitimate 

12 business or service provider, or to an owner or oper13 ator of real estate or equipment that is leased or 

14 sold to a cannabis-related legitimate business or 

15 service provider, shall not be subject to criminal, 

16 civil, or administrative forfeiture of that legal inter17 est pursuant to any Federal law for providing such 

18 loan or other financial service. 

19 SEC. 5. RULES OF CONSTRUCTION. 

20 (a) NO REQUIREMENT TO PROVIDE FINANCIAL

21 SERVICES.—Nothing in this Act shall require a depository 

22 institution, entity performing a financial service for or in 

23 association with a depository institution, or insurer to pro24 vide financial services to a cannabis-related legitimate 

25 business, service provider, or any other business. 


pamtmann on DSKBC07HB2PROD with BILLS
10 

HR 1996 RFS

1 (b) GENERAL EXAMINATION, SUPERVISORY, AND

2 ENFORCEMENT AUTHORITY.—Nothing in this Act may be 

3 construed in any way as limiting or otherwise restricting 

4 the general examination, supervisory, and enforcement au5 thority of the Federal banking regulators, provided that 

6 the basis for any supervisory or enforcement action is not 

7 the provision of financial services to a cannabis-related le8 gitimate business or service provider. 

9 (c) BUSINESS OF INSURANCE.—Nothing in this Act 

10 shall interfere with the regulation of the business of insur11 ance in accordance with the Act of March 9, 1945 (59 

12 Stat. 33, chapter 20; 15 U.S.C. 1011 et seq.) (commonly 

13 known as the ‘‘McCarran-Ferguson Act’’) and the Dodd14 Frank Wall Street Reform and Consumer Protection Act 

15 (12 U.S.C. 5301 et seq.). 

16 SEC. 6. REQUIREMENTS FOR FILING SUSPICIOUS ACTIVITY 

17 REPORTS. 

18 Section 5318(g) of title 31, United States Code, is 

19 amended by adding at the end the following: 

20 ‘‘(5) REQUIREMENTS FOR CANNABIS-RELATED

21 LEGITIMATE BUSINESSES.— 

22 ‘‘(A) IN GENERAL.—With respect to a fi23 nancial institution or any director, officer, em24 ployee, or agent of a financial institution that 

25 reports a suspicious transaction pursuant to 


pamtmann on DSKBC07HB2PROD with BILLS
11 

HR 1996 RFS

1 this subsection, if the reason for the report re2 lates to a cannabis-related legitimate business 

3 or service provider, the report shall comply with 

4 appropriate guidance issued by the Financial 

5 Crimes Enforcement Network. Not later than 

6 the end of the 180-day period beginning on the 

7 date of enactment of this paragraph, the Sec8 retary shall update the February 14, 2014, 

9 guidance titled ‘BSA Expectations Regarding 

10 Marijuana-Related Businesses’ (FIN–2014– 

11 G001) to ensure that the guidance is consistent 

12 with the purpose and intent of the SAFE 

13 Banking Act of 2021 and does not significantly 

14 inhibit the provision of financial services to a 

15 cannabis-related legitimate business or service 

16 provider in a State, political subdivision of a 

17 State, or Indian country that has allowed the 

18 cultivation, production, manufacture, transpor19 tation, display, dispensing, distribution, sale, or 

20 purchase of cannabis pursuant to law or regula21 tion of such State, political subdivision, or In22 dian Tribe that has jurisdiction over the Indian 

23 country. 

24 ‘‘(B) DEFINITIONS.—For purposes of this 

25 paragraph: 


pamtmann on DSKBC07HB2PROD with BILLS
12 

HR 1996 RFS

1 ‘‘(i) CANNABIS.—The term ‘cannabis’ 

2 has the meaning given the term ‘mari3 huana’ in section 102 of the Controlled 

4 Substances Act (21 U.S.C. 802). 

5 ‘‘(ii) CANNABIS-RELATED LEGITIMATE

6 BUSINESS.—The term ‘cannabis-related le7 gitimate business’ has the meaning given 

8 that term in section 14 of the SAFE 

9 Banking Act of 2021. 

10 ‘‘(iii) INDIAN COUNTRY.—The term 

11 ‘Indian country’ has the meaning given 

12 that term in section 1151 of title 18. 

13 ‘‘(iv) INDIAN TRIBE.—The term ‘In14 dian Tribe’ has the meaning given that 

15 term in section 102 of the Federally Rec16 ognized Indian Tribe List Act of 1994 (25 

17 U.S.C. 479a). 

18 ‘‘(v) FINANCIAL SERVICE.—The term 

19 ‘financial service’ has the meaning given 

20 that term in section 14 of the SAFE 

21 Banking Act of 2021. 

22 ‘‘(vi) SERVICE PROVIDER.—The term 

23 ‘service provider’ has the meaning given 

24 that term in section 14 of the SAFE 

25 Banking Act of 2021. 


pamtmann on DSKBC07HB2PROD with BILLS
13 

HR 1996 RFS

1 ‘‘(vii) STATE.—The term ‘State’ 

2 means each of the several States, the Dis3 trict of Columbia, the Commonwealth of 

4 Puerto Rico, and any territory or posses5 sion of the United States.’’. 

6 SEC. 7. GUIDANCE AND EXAMINATION PROCEDURES. 

7 Not later than 180 days after the date of enactment 

8 of this Act, the Financial Institutions Examination Coun9 cil shall develop uniform guidance and examination proce10 dures for depository institutions that provide financial 

11 services to cannabis-related legitimate businesses and 

12 service providers. 

13 SEC. 8. ANNUAL DIVERSITY AND INCLUSION REPORT. 

14 The Federal banking regulators shall issue an annual 

15 report to Congress containing— 

16 (1) information and data on the availability of 

17 access to financial services for minority-owned and 

18 women-owned cannabis-related legitimate businesses; 

19 and 

20 (2) any regulatory or legislative recommenda21 tions for expanding access to financial services for 

22 minority-owned and women-owned cannabis-related 

23 legitimate businesses. 


pamtmann on DSKBC07HB2PROD with BILLS
14 

HR 1996 RFS

1 SEC. 9. GAO STUDY ON DIVERSITY AND INCLUSION. 

2 (a) STUDY.—The Comptroller General of the United 

3 States shall carry out a study on the barriers to market4 place entry, including in the licensing process, and the ac5 cess to financial services for potential and existing minor6 ity-owned and women-owned cannabis-related legitimate 

7 businesses. 

8 (b) REPORT.—The Comptroller General shall issue a 

9 report to the Congress— 

10 (1) containing all findings and determinations 

11 made in carrying out the study required under sub12 section (a); and 

13 (2) containing any regulatory or legislative rec14 ommendations for removing barriers to marketplace 

15 entry, including in the licensing process, and ex16 panding access to financial services for potential and 

17 existing minority-owned and women-owned cannabis18 related legitimate businesses. 

19 SEC. 10. GAO STUDY ON EFFECTIVENESS OF CERTAIN RE20 PORTS ON FINDING CERTAIN PERSONS. 

21 Not later than 2 years after the date of the enact22 ment of this Act, the Comptroller General of the United 

23 States shall carry out a study on the effectiveness of re24 ports on suspicious transactions filed pursuant to section 

25 5318(g) of title 31, United States Code, at finding individ26 uals or organizations suspected or known to be engaged 


pamtmann on DSKBC07HB2PROD with BILLS
15 

HR 1996 RFS

1 with transnational criminal organizations and whether any 

2 such engagement exists in a State, political subdivision, 

3 or Indian Tribe that has jurisdiction over Indian country 

4 that allows the cultivation, production, manufacture, sale, 

5 transportation, display, dispensing, distribution, or pur6 chase of cannabis. The study shall examine reports on sus7 picious transactions as follows: 

8 (1) During the period of 2014 until the date of 

9 the enactment of this Act, reports relating to mari10 juana-related businesses. 

11 (2) During the 1-year period after date of the 

12 enactment of this Act, reports relating to cannabis13 related legitimate businesses. 

14 SEC. 11. APPLICATION OF THIS ACT WITH RESPECT TO 

15 HEMP-RELATED LEGITIMATE BUSINESSES 

16 AND HEMP-RELATED SERVICE PROVIDERS. 

17 (a) IN GENERAL.—The provisions of this Act (other 

18 than sections 6 and 10) shall apply with respect to hemp19 related legitimate businesses and hemp-related service pro20 viders in the same manner as such provisions apply with 

21 respect to cannabis-related legitimate businesses and serv22 ice providers. 

23 (b) DEFINITIONS.—In this section: 

24 (1) CBD.—The term ‘‘CBD’’ means 

25 cannabidiol. 


pamtmann on DSKBC07HB2PROD with BILLS
16 

HR 1996 RFS

1 (2) HEMP.—The term ‘‘hemp’’ has the meaning 

2 given that term under section 297A of the Agricul3 tural Marketing Act of 1946 (7 U.S.C. 1639o). 

4 (3) HEMP-RELATED LEGITIMATE BUSINESS.— 

5 The term ‘‘hemp-related legitimate business’’ means 

6 a manufacturer, producer, or any person or company 

7 that— 

8 (A) engages in any activity described in 

9 subparagraph (B) in conformity with the Agri10 cultural Improvement Act of 2018 (Public Law 

11 115–334) and the regulations issued to imple12 ment such Act by the Department of Agri13 culture, where applicable, and the law of a 

14 State or political subdivision thereof or Indian 

15 Tribe; and 

16 (B) participates in any business or orga17 nized activity that involves handling hemp, 

18 hemp-derived CBD products, and other hemp19 derived cannabinoid products, including culti20 vating, producing, extracting, manufacturing, 

21 selling, transporting, displaying, dispensing, dis22 tributing, or purchasing hemp, hemp-derived 

23 CBD products, and other hemp-derived 

24 cannabinoid products. 


pamtmann on DSKBC07HB2PROD with BILLS
17 

HR 1996 RFS

1 (4) HEMP-RELATED SERVICE PROVIDER.—The 

2 term ‘‘hemp-related service provider’’— 

3 (A) means a business, organization, or 

4 other person that— 

5 (i) sells goods or services to a hemp6 related legitimate business; or 

7 (ii) provides any business services, in8 cluding the sale or lease of real or any 

9 other property, legal or other licensed serv10 ices, or any other ancillary service, relating 

11 to hemp, hemp-derived CBD products, or 

12 other hemp-derived cannabinoid products; 

13 and 

14 (B) does not include a business, organiza15 tion, or other person that participates in any 

16 business or organized activity that involves han17 dling hemp, hemp-derived CBD products, or 

18 other hemp-derived cannabinoid products, in19 cluding cultivating, producing, manufacturing, 

20 selling, transporting, displaying, dispensing, dis21 tributing, or purchasing hemp, hemp-derived 

22 CBD products, and other hemp-derived 

23 cannabinoid products. 


pamtmann on DSKBC07HB2PROD with BILLS
18 

HR 1996 RFS

1 SEC. 12. BANKING SERVICES FOR HEMP-RELATED LEGITI2 MATE BUSINESSES AND HEMP-RELATED 

3 SERVICE PROVIDERS. 

4 (a) FINDINGS.—The Congress finds that— 

5 (1) the Agriculture Improvement Act of 2018 

6 (Public Law 115–334) legalized hemp by removing 

7 it from the definition of ‘‘marihuana’’ under the 

8 Controlled Substances Act; 

9 (2) despite the legalization of hemp, some hemp 

10 businesses (including producers, manufacturers, and 

11 retailers) continue to have difficulty gaining access 

12 to banking products and services; and 

13 (3) businesses involved in the sale of hemp-de14 rived CBD products are particularly affected, due to 

15 confusion about the legal status of such products. 

16 (b) FEDERAL BANKING REGULATORS’ HEMP BANK17 ING GUIDANCE.—Not later than the end of the 90-day pe18 riod beginning on the date of enactment of this Act, the 

19 Federal banking regulators shall update their existing 

20 guidance, as applicable, regarding the provision of finan21 cial services to hemp-related legitimate businesses and 

22 hemp-related service providers to address— 

23 (1) compliance with financial institutions’ exist24 ing obligations under Federal laws and imple25 menting regulations determined relevant by the Fed26 eral banking regulators, including subchapter II of 


pamtmann on DSKBC07HB2PROD with BILLS
19 

HR 1996 RFS

1 chapter 53 of title 31, United States Code, and its 

2 implementing regulation in conformity with this Act 

3 and the Department of Agriculture’s rules regulating 

4 domestic hemp production (7 CFR 990); and 

5 (2) best practices for financial institutions to 

6 follow when providing financial services, including 

7 processing payments, to hemp-related legitimate 

8 businesses and hemp-related service providers. 

9 (c) DEFINITIONS.—In this section: 

10 (1) FINANCIAL INSTITUTION.—The term ‘‘fi11 nancial institution’’— 

12 (A) has the meaning given that term under 

13 section 5312(a) of title 31, United States Code; 

14 and 

15 (B) includes a bank holding company, as 

16 defined under section 2(a) of the Bank Holding 

17 Company Act of 1956 (12 U.S.C. 1841(a)). 

18 (2) HEMP TERMS.—The terms ‘‘CBD’’, 

19 ‘‘hemp’’, ‘‘hemp-related legitimate business’’, and 

20 ‘‘hemp-related service provider’’ have the meaning 

21 given those terms, respectively, under section 11. 

22 SEC. 13. REQUIREMENTS FOR DEPOSIT ACCOUNT TERMI23 NATION REQUESTS AND ORDERS. 

24 (a) TERMINATION REQUESTS OR ORDERS MUST BE

25 VALID.— 


pamtmann on DSKBC07HB2PROD with BILLS
20 

HR 1996 RFS

1 (1) IN GENERAL.—An appropriate Federal 

2 banking agency may not formally or informally re3 quest or order a depository institution to terminate 

4 a specific customer account or group of customer ac5 counts or to otherwise restrict or discourage a de6 pository institution from entering into or maintain7 ing a banking relationship with a specific customer 

8 or group of customers unless— 

9 (A) the agency has a valid reason for such 

10 request or order; and 

11 (B) such reason is not based solely on rep12 utation risk. 

13 (2) TREATMENT OF NATIONAL SECURITY

14 THREATS.—If an appropriate Federal banking agen15 cy believes a specific customer or group of customers 

16 is, or is acting as a conduit for, an entity which— 

17 (A) poses a threat to national security; 

18 (B) is involved in terrorist financing; 

19 (C) is an agency of the Government of 

20 Iran, North Korea, Syria, or any country listed 

21 from time to time on the State Sponsors of 

22 Terrorism list; 

23 (D) is located in, or is subject to the juris24 diction of, any country specified in subpara25 graph (C); or 


pamtmann on DSKBC07HB2PROD with BILLS
21 

HR 1996 RFS

1 (E) does business with any entity described 

2 in subparagraph (C) or (D), unless the appro3 priate Federal banking agency determines that 

4 the customer or group of customers has used 

5 due diligence to avoid doing business with any 

6 entity described in subparagraph (C) or (D), 

7 such belief shall satisfy the requirement under para8 graph (1). 

9 (b) NOTICE REQUIREMENT.— 

10 (1) IN GENERAL.—If an appropriate Federal 

11 banking agency formally or informally requests or 

12 orders a depository institution to terminate a spe13 cific customer account or a group of customer ac14 counts, the agency shall— 

15 (A) provide such request or order to the 

16 institution in writing; and 

17 (B) accompany such request or order with 

18 a written justification for why such termination 

19 is needed, including any specific laws or regula20 tions the agency believes are being violated by 

21 the customer or group of customers, if any. 

22 (2) JUSTIFICATION REQUIREMENT.—A jus23 tification described under paragraph (1)(B) may not 

24 be based solely on the reputation risk to the deposi25 tory institution. 


pamtmann on DSKBC07HB2PROD with BILLS
22 

HR 1996 RFS

1 (c) CUSTOMER NOTICE.— 

2 (1) NOTICE REQUIRED.—Except as provided 

3 under paragraph (2) or as otherwise prohibited from 

4 being disclosed by law, if an appropriate Federal 

5 banking agency orders a depository institution to 

6 terminate a specific customer account or a group of 

7 customer accounts, the depository institution shall 

8 inform the specific customer or group of customers 

9 of the justification for the customer’s account termi10 nation described under subsection (b). 

11 (2) NOTICE PROHIBITED.— 

12 (A) NOTICE PROHIBITED IN CASES OF NA13 TIONAL SECURITY.—If an appropriate Federal 

14 banking agency requests or orders a depository 

15 institution to terminate a specific customer ac16 count or a group of customer accounts based on 

17 a belief that the customer or customers pose a 

18 threat to national security, or are otherwise de19 scribed under subsection (a)(2), neither the de20 pository institution nor the appropriate Federal 

21 banking agency may inform the customer or 

22 customers of the justification for the customer’s 

23 account termination. 

24 (B) NOTICE PROHIBITED IN OTHER

25 CASES.—If an appropriate Federal banking 


pamtmann on DSKBC07HB2PROD with BILLS
23 

HR 1996 RFS

1 agency determines that the notice required 

2 under paragraph (1) may interfere with an au3 thorized criminal investigation, neither the de4 pository institution nor the appropriate Federal 

5 banking agency may inform the specific cus6 tomer or group of customers of the justification 

7 for the customer’s account termination. 

8 (d) REPORTING REQUIREMENT.—Each appropriate 

9 Federal banking agency shall issue an annual report to 

10 the Congress stating— 

11 (1) the aggregate number of specific customer 

12 accounts that the agency requested or ordered a de13 pository institution to terminate during the previous 

14 year; and 

15 (2) the legal authority on which the agency re16 lied in making such requests and orders and the fre17 quency on which the agency relied on each such au18 thority. 

19 (e) DEFINITIONS.—For purposes of this section: 

20 (1) APPROPRIATE FEDERAL BANKING AGEN21 CY.—The term ‘‘appropriate Federal banking agen22 cy’’ means— 

23 (A) the appropriate Federal banking agen24 cy, as defined under section 3 of the Federal 

25 Deposit Insurance Act (12 U.S.C. 1813); and 


pamtmann on DSKBC07HB2PROD with BILLS
24 

HR 1996 RFS

1 (B) the National Credit Union Administra2 tion, in the case of an insured credit union. 

3 (2) DEPOSITORY INSTITUTION.—The term ‘‘de4 pository institution’’ means— 

5 (A) a depository institution, as defined 

6 under section 3 of the Federal Deposit Insur7 ance Act (12 U.S.C. 1813); and 

8 (B) an insured credit union. 

9 SEC. 14. DEFINITIONS. 

10 In this Act: 

11 (1) BUSINESS OF INSURANCE.—The term 

12 ‘‘business of insurance’’ has the meaning given such 

13 term in section 1002 of the Dodd-Frank Wall Street 

14 Reform and Consumer Protection Act (12 U.S.C. 

15 5481). 

16 (2) CANNABIS.—The term ‘‘cannabis’’ has the 

17 meaning given the term ‘‘marihuana’’ in section 102 

18 of the Controlled Substances Act (21 U.S.C. 802). 

19 (3) CANNABIS PRODUCT.—The term ‘‘cannabis 

20 product’’ means any article which contains cannabis, 

21 including an article which is a concentrate, an edi22 ble, a tincture, a cannabis-infused product, or a top23 ical. 

24 (4) CANNABIS-RELATED LEGITIMATE BUSI25 NESS.—The term ‘‘cannabis-related legitimate busiVerDate Sep 11 2014 23:16 Apr 20, 2021 Jkt 019200 PO 00000 Frm 00024 Fmt 6652 Sfmt 6201 E:\BILLS\H1996.RFS H1996

pamtmann on DSKBC07HB2PROD with BILLS
25 

HR 1996 RFS

1 ness’’ means a manufacturer, producer, or any per2 son or company that— 

3 (A) engages in any activity described in 

4 subparagraph (B) pursuant to a law established 

5 by a State or a political subdivision of a State, 

6 as determined by such State or political subdivi7 sion; and 

8 (B) participates in any business or orga9 nized activity that involves handling cannabis or 

10 cannabis products, including cultivating, pro11 ducing, manufacturing, selling, transporting, 

12 displaying, dispensing, distributing, or pur13 chasing cannabis or cannabis products. 

14 (5) DEPOSITORY INSTITUTION.—The term ‘‘de15 pository institution’’ means— 

16 (A) a depository institution as defined in 

17 section 3(c) of the Federal Deposit Insurance 

18 Act (12 U.S.C. 1813(c)); 

19 (B) a Federal credit union as defined in 

20 section 101 of the Federal Credit Union Act 

21 (12 U.S.C. 1752); or 

22 (C) a State credit union as defined in sec23 tion 101 of the Federal Credit Union Act (12 

24 U.S.C. 1752). 


pamtmann on DSKBC07HB2PROD with BILLS
26 

HR 1996 RFS

1 (6) FEDERAL BANKING REGULATOR.—The 

2 term ‘‘Federal banking regulator’’ means each of the 

3 Board of Governors of the Federal Reserve System, 

4 the Bureau of Consumer Financial Protection, the 

5 Federal Deposit Insurance Corporation, the Federal 

6 Housing Finance Agency, the Financial Crimes En7 forcement Network, the Office of Foreign Asset 

8 Control, the Office of the Comptroller of the Cur9 rency, the National Credit Union Administration, 

10 the Department of the Treasury, or any Federal 

11 agency or department that regulates banking or fi12 nancial services, as determined by the Secretary of 

13 the Treasury. 

14 (7) FINANCIAL SERVICE.—The term ‘‘financial 

15 service’’— 

16 (A) means a financial product or service, 

17 as defined in section 1002 of the Dodd-Frank 

18 Wall Street Reform and Consumer Protection 

19 Act (12 U.S.C. 5481), regardless if the cus20 tomer receiving the product or service is a con21 sumer or commercial entity; 

22 (B) means a financial product or service, 

23 or any combination of products and services, 

24 permitted to be provided by— 


pamtmann on DSKBC07HB2PROD with BILLS
27 

HR 1996 RFS

1 (i) a national bank or a financial sub2 sidiary pursuant to the authority provided 

3 under— 

4 (I) the provision designated 

5 ‘‘Seventh’’ of section 5136 of the Re6 vised Statutes of the United States 

7 (12 U.S.C. 24); or 

8 (II) section 5136A of the Revised 

9 Statutes of the United States (12 

10 U.S.C. 24a); and 

11 (ii) a Federal credit union, pursuant 

12 to the authority provided under the Fed13 eral Credit Union Act; 

14 (C) includes the business of insurance; 

15 (D) includes, whether performed directly or 

16 indirectly, the authorizing, processing, clearing, 

17 settling, billing, transferring for deposit, trans18 mitting, delivering, instructing to be delivered, 

19 reconciling, collecting, or otherwise effectuating 

20 or facilitating of payments or funds, where such 

21 payments or funds are made or transferred by 

22 any means, including by the use of credit cards, 

23 debit cards, other payment cards, or other ac24 cess devices, accounts, original or substitute 

25 checks, or electronic funds transfers; 


pamtmann on DSKBC07HB2PROD with BILLS
28 

HR 1996 RFS

1 (E) includes acting as a money transmit2 ting business which directly or indirectly makes 

3 use of a depository institution in connection 

4 with effectuating or facilitating a payment for 

5 a cannabis-related legitimate business or service 

6 provider in compliance with section 5330 of 

7 title 31, United States Code, and any applicable 

8 State law; and 

9 (F) includes acting as an armored car 

10 service for processing and depositing with a de11 pository institution or a Federal reserve bank 

12 with respect to any monetary instruments (as 

13 defined under section 1956(c)(5) of title 18, 

14 United States Code. 

15 (8) INDIAN COUNTRY.—The term ‘‘Indian coun16 try’’ has the meaning given that term in section 

17 1151 of title 18. 

18 (9) INDIAN TRIBE.—The term ‘‘Indian Tribe’’ 

19 has the meaning given that term in section 102 of 

20 the Federally Recognized Indian Tribe List Act of 

21 1994 (25 U.S.C. 479a). 

22 (10) INSURER.—The term ‘‘insurer’’ has the 

23 meaning given that term under section 313(r) of 

24 title 31, United States Code. 


pamtmann on DSKBC07HB2PROD with BILLS
29 

HR 1996 RFS

1 (11) MANUFACTURER.—The term ‘‘manufac2 turer’’ means a person who manufactures, com3 pounds, converts, processes, prepares, or packages 

4 cannabis or cannabis products. 

5 (12) PRODUCER.—The term ‘‘producer’’ means 

6 a person who plants, cultivates, harvests, or in any 

7 way facilitates the natural growth of cannabis. 

8 (13) SERVICE PROVIDER.—The term ‘‘service 

9 provider’’— 

10 (A) means a business, organization, or 

11 other person that— 

12 (i) sells goods or services to a can13 nabis-related legitimate business; or 

14 (ii) provides any business services, in15 cluding the sale or lease of real or any 

16 other property, legal or other licensed serv17 ices, or any other ancillary service, relating 

18 to cannabis; and 

19 (B) does not include a business, organiza20 tion, or other person that participates in any 

21 business or organized activity that involves han22 dling cannabis or cannabis products, including 

23 cultivating, producing, manufacturing, selling, 

24 transporting, displaying, dispensing, distribVerDate Sep 11 2014 23:16 Apr 20, 2021 Jkt 019200 PO 00000 Frm 00029 Fmt 6652 Sfmt 6201 E:\BILLS\H1996.RFS H1996

pamtmann on DSKBC07HB2PROD with BILLS
30 

HR 1996 RFS

1 uting, or purchasing cannabis or cannabis prod2 ucts. 

3 (14) STATE.—The term ‘‘State’’ means each of 

4 the several States, the District of Columbia, the 

5 Commonwealth of Puerto Rico, and any territory or 

6 possession of the United States. 

7 SEC. 15. DISCRETIONARY SURPLUS FUNDS. 

8 Section 7(a)(3)(A) of the Federal Reserve Act (12 

9 U.S.C. 289(a)(3)(A)) is amended by reducing the dollar 

10 figure by $6,000,000. 

Passed the House of Representatives April 19, 2021. 

Attest: CHERYL L. JOHNSON, 

Clerk. 


pamtmann on DSKBC07HB2PROD with BILLS