More about the Perlmutter-Heck banking bill

I called Rep. Denny Heck’s office while looking for some answers on the excise tax issues I’ve been learning about.

They referred me to another agency, but they also gave me some details on the Perlmutter-Heck Marijuana Business Access to Banking Act.

(Rep. Denny Heck)
(Rep. Denny Heck)

The amendment to HR 5016 passed in the House of Representatives, 231-192, on Wednesday, July 16, and is awaiting further action.

The news may be a bit old, but it’s not something we’ve written about yet here at Cannabis Chronicles, so I thought I’d pass the details along to everybody.

Heck had this to say about the bill:

“With marijuana retail shops now in operation in Washington state, financial security for these businesses is urgent and immediately necessary to protect from the harms of operating as a cash-only entity,” Heck said in an email to The Columbian. “We can’t just expect these businesses to hide their cash under a mattress and think that this won’t place a huge burden on law enforcement. I’m thankful that 230 of my colleagues, from both sides of the aisle and from all over the country, recognize the need to protect public safety and deter crime. I am encouraged by this momentum and look forward to implementing common-sense guidelines for banks and marijuana businesses to develop a legitimate, reliable financial management system.”

More information is below.

-SueVo (Sue.Vorenberg@columbian.com)

From Heck’s office:

The Perlmutter/Heck bill updates federal banking rules to resolve conflicts between federal and state laws, promoting community safety and financial security.

Currently, under federal banking laws, many legal, regulated legitimate marijuana businesses that follow state law are prevented from opening bank accounts and operating as any other businesses would. They are therefore forced to operate as cash-only enterprises, inviting crime such as robbery and tax evasion and adding to the burden of setting up a legitimate small business.

The Marijuana Business Access to Banking Act would allow banks, credit unions and other depository institutions the legal clearance to provide banking services to a marijuana-related legitimate business, ensuring these businesses do not have to operate on a cash-only basis.

Under the bill, federal banking regulators may not:

– Threaten or limit a depository institutions’ access to the Deposit Insurance Fund
– Discourage, prohibit, or penalize depository institutions
– Take any action against a loan made to a covered business
– Force a depository institution to halt providing any kind of banking services

Additionally, any depository institution and/or the employees shall be immune from federal prosecution or investigation solely for providing banking services to a covered business.

Under the legislation, a covered “financial product and service” includes:

– Providing and/or extending credit and servicing such loans
– Extending or brokering leases of real property, providing real estate settlement services
– Engaging in depository-taking activities, transmitting or exchanging funds on behalf of a consumer
– Selling, providing, or issuing stored value or payment instruments
– Providing check cashing, check collection or check guaranty services
– Providing payments or other financial data processing products or services
– Providing financial advisory services
– Collecting debt related to any consumer financial product or service


The Heck (WA) Amendment to H.R. 5016 will allow legitimate marijuana-related businesses operating according to state laws to access the banking system in an effort to reduce the risks and public safety concern of operating as a cash-only business.

The Amendment stops banking regulators from penalizing financial institutions for providing services to marijuana related business that operate according to state law.

Amendment passed the House of Representatives, 231-192, on Wednesday, July 16.

• 33 states and the District of Columbia have legalized the use of either medical (31 states) or adult and medical-use (2 states) marijuana.

• Because marijuana remains classified as Schedule I drug, individuals who grow, possess, use, sell, transport, or distribute marijuana remain subject to federal criminal prosecution, even in Colorado and Washington state that have legalized those actions.

• Consequently, financial institutions providing banking services to legitimate marijuana businesses are subject to criminal prosecution.

• Earlier this year, DOJ and Treasury released guidance for banking regulators on how banks can provide services to legitimate marijuana business. While the guidance has not fully solved the problem—many banks are still reluctant to offer financial services to marijuana businesses—it has created a framework for allowing marijuana businesses to access the banking system.

• As cash-only businesses, marijuana businesses are targets for crime and robbery, which puts employees, customers, bystanders and law enforcement at risk.

• The inability of marijuana related businesses to access the banking system also makes it harder for regulators and law enforcement to monitor transactions and prosecute crime.

• Restricting marijuana business’s access to banks forces them to operate as a cash-only business, which results in a serious public safety and law enforcement concern. In the last two years, marijuana businesses in Denver have suffered from an annual burglary rate of about 50 percent.