SAFER Banking Act

Bill: 118-s-2860
Sponsor: Sen. Merkley, Jeff [D-OR]
Introduced: 2023-09-20 in the Senate
Policy area: Finance and Financial Sector
Subjects: Administrative law and regulatory procedures
Asia
Bank accounts, deposits, capital
Banking and financial institutions regulation
Business records
Congressional oversight
Consumer affairs
Credit and credit markets
Criminal investigation, prosecution, interrogation
Department of the Treasury
Drug trafficking and controlled substances
Drug, alcohol, tobacco use
Evidence and witnesses
Federal Deposit Insurance Corporation (FDIC)
Federal Reserve System
Financial services and investments
Fraud offenses and financial crimes
Government information and archives
Government liability
Government studies and investigations
Insurance industry and regulation
Iran
Judicial procedure and administration
Licensing and registrations
Middle East
Minority and disadvantaged businesses
National Credit Union Administration
North Korea
Organized crime
Syria
Terrorism
Women in business

Summary:
action_date: 2023-09-20
text: 

Secure And Fair Enforcement Regulation Banking Act or the SAFER Banking Act
 
 
This bill provides protections for federally regulated financial institutions that serve state-sanctioned marijuana businesses. Currently, many financial institutions do not provide services to state-sanctioned marijuana businesses due to the federal classification of marijuana as a Schedule I controlled substance. 
 
Under the bill, a federal banking regulator may not penalize a depository institution for providing banking services to a state-sanctioned marijuana business. For example, regulators may not terminate or limit the deposit or share insurance of a depository institution solely because the institution provides financial services to a state-sanctioned marijuana business.
 
The bill also prohibits a federal banking regulator from requesting or requiring a depository institution to terminate a deposit account unless (1) there is a valid reason, such as the regulator has cause to believe that the depository institution is engaging in an unsafe or unsound practice; and (2) reputational risk is not the dispositive factor.
 
Additionally, proceeds from a transaction involving activities of a state-sanctioned marijuana business are no longer considered proceeds from unlawful activity. (Financial institutions that handle proceeds from unlawful activity are subject to anti-money laundering laws. Violators of these laws are subject to fines and imprisonment.)
 
Furthermore, a financial institution, insurer, or federal agency may not be held liable or subject to asset forfeiture under federal law for providing a loan, mortgage, or other financial service to a state-sanctioned marijuana business.

action_date: 2023-09-28
text: 

Secure And Fair Enforcement Regulation Banking Act or the SAFER Banking Act
 
 
This bill provides protections for federally regulated financial institutions that serve state-sanctioned marijuana businesses. Currently, many financial institutions do not provide services to state-sanctioned marijuana businesses due to the federal classification of marijuana as a Schedule I controlled substance. 
 
Under the bill, a federal banking regulator may not penalize a depository institution for providing banking services to a state-sanctioned marijuana business. For example, regulators may not terminate or limit the deposit or share insurance of a depository institution solely because the institution provides financial services to a state-sanctioned marijuana business.
 
The bill also prohibits a federal banking regulator from requesting or requiring a depository institution to terminate a deposit account unless (1) there is a valid reason, such as the regulator has cause to believe that the depository institution is engaging in an unsafe or unsound practice; and (2) reputational risk is not the dispositive factor.
 
Additionally, proceeds from a transaction conducted by a state-sanctioned marijuana business are no longer considered proceeds from unlawful activity. (Financial institutions that handle proceeds from unlawful activity are subject to anti-money laundering laws. Violators of these laws are subject to fines and imprisonment.)
 
Furthermore, a financial institution, insurer, or federal agency may not be held liable or subject to asset forfeiture under federal law for providing a loan, mortgage, or other financial service to a state-sanctioned marijuana business.


Legislative actions:
action_date: 2023-12-06
text: Committee on Banking, Housing, and Urban Affairs. Hearings held.
action_date: 2023-09-28
text: Placed on Senate Legislative Calendar under General Orders. Calendar No. 215.
action_date: 2023-09-28
text: Committee on Banking, Housing, and Urban Affairs. Reported by Senator Brown with amendments. Without written report.
action_date: 2023-09-28
text: Committee on Banking, Housing, and Urban Affairs. Reported by Senator Brown with amendments. Without written report.
action_date: 2023-09-27
text: Committee on Banking, Housing, and Urban Affairs. Ordered to be reported with amendments favorably.
action_date: 2023-09-20
text: Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.
action_date: 2023-09-20
text: Introduced in Senate