U.S. senators on both sides of the aisle addressed the lack of banking access for the marijuana industry at a committee hearing on Wednesday, with one GOP member suggesting that the issue warrants a broader examination of federal cannabis policies.
Meanwhile, a separate House committee also met to discuss banking issues, where the marijuana industry’s unique financial challenges were also raised.
The repeated mentions of cannabis businesses at the Senate Banking Committee hearing were all the more notable considering that the panel’s chairman, Sen. Tim Scott (R-SC), emphasized on multiple occasions—before and during the meeting—that the focus should be on de-banking issues for “federally legal” companies.
But Democratic and Republican members alike called attention to the cannabis industry nonetheless.
For example, Sen. Elizabeth Warren (D-MA) in her opening remarks noted that “lawful cannabis businesses have been unable to open accounts and employees of those businesses have been debanked.”
“This shouldn’t be happening, and we need to figure out why and who is responsible,” the senator, who also entered into the record stories from marijuana businesses that have been impacted by debanking, said.
Sen. Thom Tillis (R-NC), meanwhile, questioned the germaneness of talking about marijuana banking in the debanking context given that, “the last time I checked the cannabis business is illegal at a federal level.” But he said he would be inclined to examine that policy disconnect.
“I, for one, think we should reexamine [federal marijuana laws], but we damn sure shouldn’t do it by passing” a bill that “makes it default legal before we take in any firm position here that provides the industry with clarity.” He mentioned the Bank Secrecy Act (BSA), but it seems he meant to reference the Secure and Fair Enforcement (SAFE) Banking Act.
“If somebody wants to work on rules of the road and do that—and bank the industry in a cohesive, sustainable way that doesn’t kind of skirt around the fact that it’s still illegal at the federal level—count me in. Happy to do it,” Tillis said.
Tillis said last December that he’s hopeful Congress will have a “discussion” about potentially creating a federal regulatory framework for marijuana in 2025, though he added that he personally wouldn’t vote to federally legalize cannabis.
Sen. Jack Reed (D-RI) also noted at the Banking Committee hearing that the panel “had a very positive discussion about the SAFE Banking Act,” and he looks forward to working with colleagues “to come up with a compromise that would still allow reputational risk to be a factor, but to put up some guardrails with regard to its application.”
The Brookings Institution’s Aaron Klein also briefly addressed the cannabis banking issue at the hearing after submitting written testimony where he recommended that the committee “either combine SAFE Banking with broader [suspicious activity reports, or SARs] reform or enhance SAFE Banking to address the problems with SARs filing on state-licensed cannabis businesses.”
Also at the hearing, Stephen Gannon, a partner at the firm Davis Wright Tremaine LLP, mentioned his own personal awareness of a wine vineyard “where the wife of the vineyard owner happened to be an investor in the cannabis industry” and “the vineyard and the individuals that own the vineyard all lost their [bank] accounts.”
“They had nothing to do with the cannabis industry, but I guess it was a knock-on effect as far as the regulators were concerned, because all those accounts went away,” he said.
In the lead-up to the hearing, marijuana workers and industry associations had been reaching out to the committee with their stories of losing bank accounts over their association with cannabis.
Part of the outreach was coordinated by Kyle Sherman, CEO of the non-plant touching cannabis industry technology platform company Flowhub.
In addition to having his own letter addressing marijuana debanking entered into the record by the chairman ahead of the hearing, Sherman told Marijuana Moment on Wednesday that over 115 other cannabis or cannabis-adjacent businesses shared their experiences with the committee through a customized form submission portal Flowhub engineered.
Sherman also had the chance to speak with Warren on Wednesday, and he said the senator made clear that “this is a priority and needs to happen, and is extraordinarily supportive of SAFER Banking.”
He said Warren expressed her understanding that her state of Massachusetts has a “robust” cannabis market and “realizes they need help—and then, more broadly, the industry needs help, and that this is really important.”
In Flowhub’s letter to the committee, the company said that “Congress has the opportunity to fulfill President Trump’s campaign commitment by advancing banking reform and ending Operation Chokepoint for American businesses like Flowhub,” referencing the president’s stated support for cannabis industry banking access on the campaign trail.
“President Trump has explicitly endorsed state-legal cannabis banking reform, and, in this ‘Promises Made, Promises Kept’ and ‘Revolution of Common Sense’ administration, Flowhub is optimistic that Congress will deliver meaningful relief to the state-legal cannabis industry, the ancillary businesses that support it, and their collective hundreds of thousands, if not millions, of American workers,” the letter says.
The U.S. Cannabis Roundtable (USCR) also had a letter entered into the record emphasizing that the SAFE Banking Act on its own “does not federally legalize,” “does change criminal penalties associated with conduct related to cannabis” and “does not require banks to service cannabis businesses.”
“The SAFE Banking act merely allows financial institutions to serve state legal and licensed businesses and those interacting with the state-legal industry without fear of retribution,” USCR said.
“No business should be at risk of being debanked, especially if it complies with state licensing and regulation requirements,” it said.
Separately, the House Financial Services Committee also held a hearing on Wednesday to discuss improvements to the community banking sector, and one witness—Cathy Owen, representing Eagle Bank and Trust Company, the Arkansas Bankers Association and the American Bankers Association—also flagged cannabis industry financial challenges in her written testimony.
Owen’s recommendation to the committee was to “enact the SAFE Banking Act to get state sanctioned cannabis cash off the street and into regulated financial institutions, making our communities safer and the cannabis industry more transparent to regulators, tax authorities and law enforcement.”
Meanwhile, congressional researchers recently released a report detailing the subject of debanking—while making a point to address how the marijuana industry’s financial services access problem “sits at the nexus” of a state-federal policy conflict that complicates the debate.
While the SAFE Banking Act to address the issue is expected to be filed again this session—that introduction is “not imminent” as some recent reports have suggested, a spokesperson for the GOP House sponsor of the last version told Marijuana Moment last month.
“While introduction is not imminent, we hope to have a firmer update on timing within the coming weeks,” the staffer for Rep. Dave Joyce (R-OH) said.
With Republicans now in control of the House and Senate—and leadership having historically opposed even modest cannabis legislation, including the banking bill—there are open questions about the prospects of advancing marijuana reform this session.
However, some are holding out hope that a measure to allow cannabis industry banking access could move, especially given President Donald Trump’s endorsement of the proposal on the campaign trail.
Separately, the Government Accountability Office (GAO) announced in December that it’s convening focus groups comprised of marijuana businesses to better understand their experiences with access to banking services under federal prohibition.
The industry remains frustrated with the lack of progress on the cannabis banking issue under the last administration.
A Senate source told Marijuana Moment in December that Republican House and Senate leadership “openly and solely blocked” then-Senate Majority Leader Chuck Schumer’s (D-NY) attempt to include the bill in a government funding bill as the session came to a close.
Warren and Sen. Tommy Tuberville (R-AL) had challenged the idea that there was enough GOP support for the SAFER Banking Act to pass on the Senate floor during the lame duck session.
Warren accused certain Republican members of overstating support for the legislation within their caucus, while also taking a hit at Trump for doing “nothing” on cannabis reform during his time in office as he makes a policy pivot ahead of the election by coming out in support of the marijuana banking bill and federal rescheduling.
Sen. John Hickenlooper (D-CO) also recently argued in an interview with Marijuana Moment that the main barrier to getting the marijuana banking bill across the finish line is a lack of sufficient Republican support in the chamber. And he said if Trump is serious about seeing the reform he recently endorsed enacted, he needs to “bring us some Republican senators.”
Prior to becoming House speaker, Rep. Mike Johnson (R-LA) consistently opposed cannabis reform, including on incremental issues like cannabis banking and making it easier to conduct scientific research on the plant.
Meanwhile, on the one-year anniversary of a Senate committee’s passage of the SAFER Banking Act in September, the Congressional Budget Office (CBO) released an analysis on the economic impact of the reform, including the likely increase in federally insured deposits from cannabis businesses by billions of dollars once banks receive protections for servicing the industry.
Separately, the CEO of the financial giant JPMorgan Chase said recently that the company “probably would” start providing banking services to marijuana businesses if federal law changed to permit it.
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The post Bipartisan Senators Address Marijuana Industry Banking Challenges At Hearing Despite Chairman’s Focus On ‘Federally Legal’ Businesses appeared first on Marijuana Moment.
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