What would passage of the SAFER Banking Act mean in 2024?
Practitioner Insights Commentaries
(March 13, 2024) – Alex Malyshev and Sarah Ganley of Carter Ledyard & Milburn LLP discuss the SAFER Banking Act, which aims to expand access to financial and banking services in relation to cannabis businesses.
It seems like every year, for the past five years, the same article gets written about the imminent passage of the Secure and Fair Enforcement Regulation Banking Act (SAFER Banking Act) — formerly known as the Secure and Fair Enforcement (SAFE) Act. Yet there is reason for optimism that 2024 might finally be the year this happens because, on Sept. 27, 2023, the SAFER Banking Act made it out of the Senate Banking Committee (by a vote of 14-9). Senate Majority Leader Chuck Schumer (D-NY) has indicated that cannabis banking reform is among the Senate’s top priorities in 2024.
Therefore, it is worthwhile to take a look at what the SAFER Banking Act would, and would not, do for the financial eco system of the state-legal cannabis industry in the form it was considered in 2023.
What’s next?
Although the SAFER Banking Act enjoys bipartisan support, it is in no way universal. A number of obstacles still remain, including the challenges of reaching consensus in the Senate and moving the bill through a Republican-controlled House. It also remains to be seen what impact, if any, the Food and Drug Administration’s recent recommendation (https://tinyurl.com/ysuurcpk) to reschedule cannabis under federal law would have on these efforts.
Alex Malyshev and Sarah Ganley are regular, joint contributing columnists on legal issues in the cannabis industry for Reuters Legal News and Westlaw Today.
Alex Malyshev is a partner at Carter Ledyard & Milburn LLP and the chair of its cannabis, hemp and CBD industry group. He contributed the chapter, “Banking and Investment Considerations for Cannabis Businesses” in “Health Care and the Business of Cannabis: Legal Questions and Answers” (American Health Law Association 2021). He can be reached at malyshev@clm.com. Sarah Ganley is an associate in the litigation department of the firm and can be reached at ganley@clm.com. Both authors are based in New York.
