The Republican chair of a key U.S. Senate panel signaled Tuesday that he’s receptive to marijuana banking reform but does have some concerns.
“I think a case has been made pretty strongly here about the need to get the banking industry issues relating to cannabis resolved,” Senate Banking Committee chair Mike Crapo, from Idaho, said near the conclusion of a landmark hearing on banking issues facing cannabis companies.
Crapo holds the key to whether reform such as the SAFE Banking Act is voted on in his committee and advanced to the full Republican-controlled chamber.
At the same time, Crapo said, a “pretty strong” case was made at the hearing that legacy cash – currency collected by cannabis companies – “poses a real problem” in providing access to illicit activities such as cartels and money laundering.
Cannabis banking reform, Crapo concluded, “is an important, complex issue that we need to get right.”
Most committee members who asked questions at the hearing expressed support for reform, but only about a third of the 25-member committee was present. Crapo said others were at an FBI briefing or another committee hearing.
John Lord, CEO of Colorado-based medical marijuana company LivWell Enlightened Health, said his firm has struggled to maintain bank accounts and currently pays $3,000 a month for one. He said dispensary sales are in cash, and security is a big concern.
Lord also said it’s “incredibly difficult if not impossible” for a new cannabis company to launch without access to bank loans unless it can tap wealthy investors.
Joanne Sherwood, speaking on behalf of the American Bankers Association, noted that the SAFE Banking Act would improve financial transparency and oversight as well as help law enforcement identify suspicious transactions.
Jeff Smith can be reached at [email protected]