II 

116TH CONGRESS 

1ST SESSION S. 1200 

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 SENATE OF THE UNITED STATES 

APRIL 11, 2019 

Mr. MERKLEY (for himself, Mr. GARDNER, Ms. ROSEN, Ms. MURKOWSKI, Mr. 

BENNET, Mr. SULLIVAN, Ms. HARRIS, Mr. PAUL, Ms. CORTEZ MASTO, 

Ms. DUCKWORTH, Mr. PETERS, Mr. MENENDEZ, Mr. KING, Mr. SANDERS, Mrs. MURRAY, Mr. MARKEY, Mr. LEAHY, Mr. SCHATZ, Mr. WYDEN, 

Ms. WARREN, Ms. HIRONO, and Mr. CRAMER) introduced the following 

bill; which was read twice and referred to the Committee on Banking, 

Housing, and Urban Affairs 

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. 

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

3 SECTION 1. SHORT TITLE; PURPOSE. 

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

5 ‘‘Secure And Fair Enforcement Banking Act of 2019’’ or 

6 the ‘‘SAFE Banking Act of 2019’’. 


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1 (b) PURPOSE.—The purpose of this Act is to increase 

2 public safety by ensuring access to financial services to 

3 cannabis-related legitimate businesses and service pro4 viders and reducing the amount of cash at such busi5 nesses. 

6 SEC. 2. SAFE HARBOR FOR DEPOSITORY INSTITUTIONS. 

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

8 not— 

9 (1) terminate or limit the deposit insurance or 

10 share insurance of a depository institution under the 

11 Federal Deposit Insurance Act (12 U.S.C. 1811 et 

12 seq.) or the Federal Credit Union Act (12 U.S.C. 

13 1751 et seq.) or take any other adverse action 

14 against a depository institution under section 8 of 

15 the Federal Deposit Insurance Act (12 U.S.C. 1818) 

16 solely because the depository institution provides or 

17 has provided financial services to a cannabis-related 

18 legitimate business or service provider; 

19 (2) prohibit, penalize, or otherwise discourage a 

20 depository institution from providing financial serv21 ices to a cannabis-related legitimate business or 

22 service provider or to a State, political subdivision of 

23 a State, or Indian Tribe that exercises jurisdiction 

24 over cannabis-related legitimate businesses; 


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1 (3) recommend, incentivize, or encourage a de2 pository institution not to offer financial services to 

3 an account holder, or to downgrade or cancel the fi4 nancial services offered to an account holder solely 

5 because— 

6 (A) the account holder is a cannabis-re7 lated legitimate business or service provider, or 

8 is an employee, owner, or operator of a can9 nabis-related legitimate business or service pro10 vider; 

11 (B) the account holder later becomes an 

12 employee, owner, or operator of a cannabis-re13 lated legitimate business or service provider; or 

14 (C) the depository institution was not 

15 aware that the account holder is an employee, 

16 owner, or operator of a cannabis-related legiti17 mate business or service provider; 

18 (4) take any adverse or corrective supervisory 

19 action on a loan made to— 

20 (A) a cannabis-related legitimate business 

21 or service provider, solely because the business 

22 is a cannabis-related legitimate business or 

23 service provider; 

24 (B) an employee, owner, or operator of a 

25 cannabis-related legitimate business or service 


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1 provider, solely because the employee, owner, or 

2 operator is employed by, owns, or operates a 

3 cannabis-related legitimate business or service 

4 provider, as applicable; or 

5 (C) an owner or operator of real estate or 

6 equipment that is leased to a cannabis-related 

7 legitimate business or service provider, solely 

8 because the owner or operator of the real estate 

9 or equipment leased the equipment or real es10 tate to a cannabis-related legitimate business or 

11 service provider, as applicable; or 

12 (5) prohibit or penalize a depository institution 

13 (or entity performing a financial service for or in as14 sociation with a depository institution) for, or other15 wise discourage a depository institution (or entity 

16 performing a financial service for or in association 

17 with a depository institution) from, engaging in a fi18 nancial service for a cannabis-related legitimate 

19 business or service provider. 

20 (b) SAFE HARBOR APPLICABLE TO DE NOVO INSTI21 TUTIONS.—Subsection (a) shall apply to an institution ap22 plying for a depository institution charter to the same ex23 tent as such subsection applies to a depository institution. 


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1 SEC. 3. PROTECTIONS FOR ANCILLARY BUSINESSES. 

2 For purposes of sections 1956 and 1957 of title 18, 

3 United States Code, and all other provisions of Federal 

4 law, the proceeds from a transaction conducted by a can5 nabis-related legitimate business or service provider shall 

6 not be considered as proceeds from an unlawful activity 

7 solely because the transaction was conducted by a can8 nabis-related legitimate business or service provider, as 

9 applicable. 

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 or 

13 service provider within a State, political subdivision of a 

14 State, or Indian country that allows the cultivation, pro15 duction, manufacture, sale, transportation, display, dis16 pensing, distribution, or purchase of cannabis pursuant to 

17 a law or regulation of such State, political subdivision, or 

18 Indian Tribe that has jurisdiction over the Indian country, 

19 as applicable, a depository institution, entity performing 

20 a financial service for or in association with a depository 

21 institution, or insurer that provides a financial service to 

22 a cannabis-related legitimate business or service provider, 

23 and the officers, directors, and employees of that deposi24 tory institution, entity, or insurer may not be held liable 

25 pursuant to any Federal law or regulation— 


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

2 or 

3 (2) for further investing any income derived 

4 from such a financial service. 

5 (b) PROTECTIONS FOR FEDERAL RESERVE

6 BANKS.—With respect to providing a service to a deposi7 tory institution that provides a financial service to a can8 nabis-related legitimate business or service provider 

9 (where such financial service is provided within a State, 

10 political subdivision of a State, or Indian country that al11 lows the cultivation, production, manufacture, sale, trans12 portation, display, dispensing, distribution, or purchase of 

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

14 political subdivision, or Indian Tribe that has jurisdiction 

15 over the Indian country, as applicable), a Federal reserve 

16 bank, and the officers, directors, and employees of the 

17 Federal reserve bank, may not be held liable pursuant to 

18 any Federal law or regulation— 

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

20 (2) for further investing any income derived 

21 from such a service. 

22 (c) FORFEITURE.— 

23 (1) DEPOSITORY INSTITUTIONS.—A depository 

24 institution that has a legal interest in the collateral 

25 for a loan or another financial service provided to an 


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

2 legitimate business or service provider, or to an 

3 owner or operator of real estate or equipment that 

4 is leased or sold to a cannabis-related legitimate 

5 business or service provider, shall not be subject to 

6 criminal, civil, or administrative forfeiture of that 

7 legal interest pursuant to any Federal law for pro8 viding such loan or other financial service. 

9 (2) FEDERAL RESERVE BANKS.—A Federal re10 serve bank that has a legal interest in the collateral 

11 for a loan or another financial service provided to an 

12 owner, employee, or operator of a depository institu13 tion that provides a financial services to a cannabis14 related legitimate business or service provider, or to 

15 an owner or operator of real estate or equipment 

16 that is leased or sold to such a depository institu17 tion, shall not be subject to criminal, civil, or admin18 istrative forfeiture of that legal interest pursuant to 

19 any Federal law for providing such loan or other fi20 nancial service. 

21 SEC. 5. RULE OF CONSTRUCTION. 

22 Nothing in this Act shall require a depository institu23 tion, entity performing a financial service for or in associa24 tion with a depository institution, or insurer to provide 


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1 financial services to a cannabis-related legitimate business 

2 or service provider. 

3 SEC. 6. REQUIREMENTS FOR FILING SUSPICIOUS ACTIVITY 

4 REPORTS. 

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

6 amended by adding at the end the following: 

7 ‘‘(5) REQUIREMENTS FOR CANNABIS-RELATED

8 LEGITIMATE BUSINESSES.— 

9 ‘‘(A) IN GENERAL.—With respect to a fi10 nancial institution or any director, officer, em11 ployee, or agent of a financial institution that 

12 reports a suspicious transaction pursuant to 

13 this subsection, if the reason for the report re14 lates to a cannabis-related legitimate business 

15 or service provider, the report shall comply with 

16 appropriate guidance issued by the Financial 

17 Crimes Enforcement Network. The Secretary 

18 shall ensure that the guidance is consistent with 

19 the purpose and intent of the SAFE Banking 

20 Act of 2019 and does not significantly inhibit 

21 the provision of financial services to a cannabis22 related legitimate business or service provider in 

23 a State, political subdivision of a State, or In24 dian country that has allowed the cultivation, 

25 production, manufacture, transportation, disVerDate Sep 11 2014 04:00 Apr 20, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S1200.IS S1200

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1 play, dispensing, distribution, sale, or purchase 

2 of cannabis pursuant to law or regulation of 

3 such State, political subdivision, or Indian 

4 Tribe that has jurisdiction over the Indian 

5 country. 

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

7 paragraph: 

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

9 has the meaning given the term ‘mari10 huana’ in section 102 of the Controlled 

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

12 ‘‘(ii) CANNABIS-RELATED LEGITIMATE

13 BUSINESS.—The term ‘cannabis-related le14 gitimate business’ has the meaning given 

15 that term in section 11 of the SAFE 

16 Banking Act of 2019. 

17 ‘‘(iii) INDIAN COUNTRY.—The term 

18 ‘Indian country’ has the meaning given 

19 that term in section 1151 of title 18. 

20 ‘‘(iv) INDIAN TRIBE.—The term ‘In21 dian Tribe’ has the meaning given that 

22 term in section 102 of the Federally Rec23 ognized Indian Tribe List Act of 1994 (25 

24 U.S.C. 479a). 


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1 ‘‘(v) FINANCIAL SERVICE.—The term 

2 ‘financial service’ has the meaning given 

3 that term in section 11 of the SAFE 

4 Banking Act of 2019. 

5 ‘‘(vi) SERVICE PROVIDER.—The term 

6 ‘service provider’ has the meaning given 

7 that term in section 11 of the SAFE 

8 Banking Act of 2019. 

9 ‘‘(vii) STATE.—The term ‘State’ 

10 means each of the several States, the Dis11 trict of Columbia, Puerto Rico, and any 

12 territory or possession of the United 

13 States.’’. 

14 SEC. 7. GUIDANCE AND EXAMINATION PROCEDURES. 

15 Not later than 180 days after the date of enactment 

16 of this Act, the Financial Institutions Examination Coun17 cil shall develop uniform guidance and examination proce18 dures for depository institutions that provide financial 

19 services to cannabis-related legitimate businesses and 

20 service providers. 

21 SEC. 8. ANNUAL DIVERSITY AND INCLUSION REPORT. 

22 The Federal banking regulators shall issue an annual 

23 report to Congress containing— 

24 (1) information and data on the availability of 

25 access to financial services for minority-owned and 


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1 women-owned cannabis-related legitimate businesses; 

2 and 

3 (2) any regulatory or legislative recommenda4 tions for expanding access to financial services for 

5 minority-owned and women-owned cannabis-related 

6 legitimate businesses. 

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

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

9 States shall carry out a study on the barriers to market10 place entry, including in the licensing process, and the ac11 cess to financial services for potential and existing minor12 ity-owned and women-owned cannabis-related legitimate 

13 businesses. 

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

15 report to the Congress— 

16 (1) containing all findings and determinations 

17 made in carrying out the study required under sub18 section (a); and 

19 (2) containing any regulatory or legislative rec20 ommendations for removing barriers to marketplace 

21 entry, including in the licensing process, and ex22 panding access to financial services for potential and 

23 existing minority-owned and women-owned cannabis24 related legitimate businesses. 


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1 SEC. 10. GAO STUDY ON EFFECTIVENESS OF CERTAIN RE2 PORTS ON FINDING CERTAIN PERSONS. 

3 Not later than 2 years after the date of the enact4 ment of this Act, the Comptroller General of the United 

5 States shall carry out a study on the effectiveness of re6 ports on suspicious transactions filed pursuant to section 

7 5318(g) of title 31, United States Code, at finding individ8 uals or organizations suspected or known to be engaged 

9 with transnational criminal organizations and whether any 

10 such engagement exists in a State, political subdivision, 

11 or Indian Tribe that has jurisdiction over Indian country 

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

13 transportation, display, dispensing, distribution, or pur14 chase of cannabis. The study shall examine reports on sus15 picious transactions as follows: 

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

17 the enactment of this Act, reports relating to mari18 juana-related businesses. 

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

20 enactment of this Act, reports relating to cannabis21 related legitimate businesses. 

22 SEC. 11. DEFINITIONS. 

23 In this Act: 

24 (1) BUSINESS OF INSURANCE.—The term 

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

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


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

2 5481). 

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

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

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

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

7 product’’ means any article which contains cannabis, 

8 including an article which is a concentrate, an edi9 ble, a tincture, a cannabis-infused product, or a top10 ical. 

11 (4) CANNABIS-RELATED LEGITIMATE BUSI12 NESS.—The term ‘‘cannabis-related legitimate busi13 ness’’ means a manufacturer, producer, or any per14 son or company that— 

15 (A) engages in any activity described in 

16 subparagraph (B) pursuant to a law established 

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

18 as determined by such State or political subdivi19 sion; and 

20 (B) participates in any business or orga21 nized activity that involves handling cannabis or 

22 cannabis products, including cultivating, pro23 ducing, manufacturing, selling, transporting, 

24 displaying, dispensing, distributing, or pur25 chasing cannabis or cannabis products. 


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1 (5) DEPOSITORY INSTITUTION.—The term ‘‘de2 pository institution’’ means— 

3 (A) a depository institution as defined in 

4 section 3(c) of the Federal Deposit Insurance 

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

6 (B) a Federal credit union as defined in 

7 section 101 of the Federal Credit Union Act 

8 (12 U.S.C. 1752); or 

9 (C) a State credit union as defined in sec10 tion 101 of the Federal Credit Union Act (12 

11 U.S.C. 1752). 

12 (6) FEDERAL BANKING REGULATOR.—The 

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

14 Board of Governors of the Federal Reserve System, 

15 the Bureau of Consumer Financial Protection, the 

16 Federal Deposit Insurance Corporation, the Finan17 cial Crimes Enforcement Network, the Office of For18 eign Asset Control, the Office of the Comptroller of 

19 the Currency, the National Credit Union Adminis20 tration, the Department of the Treasury, or any 

21 Federal agency or department that regulates bank22 ing or financial services, as determined by the Sec23 retary of the Treasury. 

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

25 service’’— 


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1 (A) means a financial product or service, 

2 as defined in section 1002 of the Dodd-Frank 

3 Wall Street Reform and Consumer Protection 

4 Act (12 U.S.C. 5481); 

5 (B) includes the business of insurance; 

6 (C) includes, whether performed directly or 

7 indirectly, the authorizing, processing, clearing, 

8 settling, billing, transferring for deposit, trans9 mitting, delivering, instructing to be delivered, 

10 reconciling, collecting, or otherwise effectuating 

11 or facilitating of payments or funds, where such 

12 payments or funds are made or transferred by 

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

14 debit cards, other payment cards, or other ac15 cess devices, accounts, original or substitute 

16 checks, or electronic funds transfers; 

17 (D) includes acting as a money transmit18 ting business which directly or indirectly makes 

19 use of a depository institution in connection 

20 with effectuating or facilitating a payment for 

21 a cannabis-related legitimate business or service 

22 provider in compliance with section 5330 of 

23 title 31, United States Code, and any applicable 

24 State law; and 


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1 (E) includes acting as an armored car 

2 service for processing and depositing with a de3 pository institution or the Board of Governors 

4 of the Federal Reserve System with respect to 

5 any monetary instruments (as defined under 

6 section 1956(c)(5) of title 18, United States 

7 Code). 

8 (8) INDIAN COUNTRY.—The term ‘‘Indian coun9 try’’ has the meaning given that term in section 

10 1151 of title 18. 

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

12 has the meaning given that term in section 102 of 

13 the Federally Recognized Indian Tribe List Act of 

14 1994 (25 U.S.C. 479a). 

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

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

17 title 31, United States Code. 

18 (11) MANUFACTURER.—The term ‘‘manufac19 turer’’ means a person who manufactures, com20 pounds, converts, processes, prepares, or packages 

21 cannabis or cannabis products. 

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

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

24 way facilitates the natural growth of cannabis. 


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

2 provider’’— 

3 (A) means a business, organization, or 

4 other person that— 

5 (i) sells goods or services to a can6 nabis-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 cannabis; and 

12 (B) does not include a business, organiza13 tion, or other person that participates in any 

14 business or organized activity that involves han15 dling cannabis or cannabis products, including 

16 cultivating, producing, manufacturing, selling, 

17 transporting, displaying, dispensing, distrib18 uting, or purchasing cannabis or cannabis prod19 ucts. 

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

21 the several States, the District of Columbia, Puerto 

22 Rico, and any territory or possession of the United 

23 States. 

Æ 


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