At this point, the Secure and Fair Enforcement Banking Act  (the SAFE Banking Act) is well known. The law would not formally legalize marijuana on a federal level. Rather, for depository institutions, the SAFE Banking Act would prohibit federal regulators from penalizing them for providing financial services to state-legal cannabis businesses. The law would also re-categorize proceeds from such businesses as not deriving from unlawful activity, thus abrogating application certain anti-money laundering laws. Moreover, institutions would not be subject to asset forfeiture for providing loans or other services to legitimate cannabis-related businesses. Succinctly put, the SAFE Banking Act seeks to harmonize state and federal law by creating a safe harbor for depository institutions providing banking services to properly licensed cannabis-related businesses and ancillary businesses that serve them.

Under the current regulatory framework, an ever-increasing number of banks and credit unions continue to provide financial services to the cannabis industry. See Marijuana Banking Update, FinCEN (March 2022) (available at: https://www.fincen.gov/frequently-requested-foia-processed-records). Yet the law remains unpassed by the Senate despite effectively formalizing what already occurs to allow financial institutions to bank cannabis-related businesses without fear of reprisal from federal regulators.

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