CUNA witness, Reps. emphasize importance of access to financial services

February 13, 2019

CUNA witness Rachel Pross, chief risk officer at Salem, Ore.-based Maps CU, answered multiple questions from members of the House Financial Services subcommittee on consumer protection and financial institutions Wednesday. Several committee members said they agreed with Pross’ testimony, that legal cannabis businesses should have access to financial services.

During her answers, Pross noted that Maps CU has filed more than 3,000 Suspicious Activity Reports (SARs) in the last two years, and that Maps has filed more than 13,000 total reports to the Treasury’s Financial Crimes Enforcement Network.

In response to a question from Rep. Scott Tipton (R-Colo.), Pross said by filing SARs Maps CU are providing law enforcement with information they wouldn’t otherwise have.

Rep. Denny Heck. (D-Wash.) noted an example of a young Marine veteran who was killed while working security for a cash-only cannabis dispensary in Aurora, Colo. Other members noted similar crimes, and that the temptation of all-cash businesses made them targets for criminals.

Much of the discussion centered around a draft of the Secure and Fair Enforcement (SAFE) Act, a bill authored by Reps. Ed Perlmutter (D-Colo.), Denny Heck (D-Wash.), Steve Stivers (R-Ohio) and Warren Davidson (R-Ohio). It would provide financial institutions accepting deposits from, extending credit or providing payment services to an individual, or business engaged in legal marijuana-related commerce with a safe harbor, if it is compliant with all other applicable laws and regulations.

It also provides safe harbor to credit unions and their employees who are not aware if their members or customers are involved in such businesses.

Perlmutter said federal laws should be designed to prevent illicit activity and help law enforcement, which he said his bill accomplishes, and lamented the safety risk presented by the “piles of cash” cannabis business must deal with.

“We need these marijuana related businesses and employees to have access to the banking system. It will improve transparency and accountability and help law enforcement root out transactions to prevent tax evasion, money laundering and other white-collar crime,” he said. Most importantly, it will help reduce the risk of violent crime in our communities. These businesses and their employees become targets for robbery and assault and more by dealing in all cash.”

Rep. Barry Loudermilk (R-Ga.), while noting he had “no interest” in helping the cannabis industry, said the hearing was an important discussion. He added that he did not want the federal government determining “what is and isn’t moral” and expressed support for policymaking at a more local level.