Cannabis is a cash-only business. Federal law prevents pot companies from using the banking system. That has made marijuana dispensaries targets for violent criminals. Robberies are commonplace. Caravans of armed thieves have marauded cannabis businesses across the nation.
Rhode Island could be next. We are one of 19 states that have begun or will soon allow cannabis sales for recreational purposes. Individual cities and towns in Rhode Island in November will decide whether to permit dispensaries to sell marijuana. The spike in sales that will accompany those decisions will increase the danger of criminal acts.
Rhode Island’s senators Jack Reed and Sheldon Whitehouse can fix this problem by voting for the SAFE Banking Act. The measure wouldn’t legalize cannabis nationally, but it would give legal pot businesses in Rhode Island access to banking services, business accounts, and credit cards. Depository institutions would be protected from civil and criminal sanctions for providing financial services to the state’s growing number of legitimate, cannabis firms.
The legislation is more than a safety measure. It would also help the state’s economy. Cannabis-related businesses often are forced to sell equity stakes in their enterprises or fall victim to predatory lenders because they can’t borrow from commercial banks. The SAFE Banking Act would help all legally operating cannabis firms raise capital, grow their services, and access reasonably priced capital. That will keep small businesses alive and well.
Cannabis employees also would benefit. Since they can only be paid in cash, workers have trouble maintaining their credit ratings and often can’t qualify for mortgages. The SAFE Banking Act would correct that as well.
The Rhode Island Banking Association joined forty-nine other state banking leaders in signing a letter to the U.S. Senate supporting the bill. SAFE Banking, they say, is “urgently needed to allow banks to handle the proceeds from state-licensed cannabis businesses and other service providers they rely upon for legal operations.” In addition, 24 U.S. senators wrote a bipartisan letter that states: “Allowing cannabis businesses operating legally and in compliance with state law to access financial services without federal reprisal would address public safety and compliance challenges, helping communities reduce cash-motivated crimes.”
The U.S. House of Representatives has passed SAFE Banking six times. Rhode Island Congressmen Jim Langevin and David Cicilline voted yes. Senators Reed and Whitehouse should do the same. They would protect Rhode Islanders’ lives and discourage cannabis-related crime. The measure, if passed, is a simple, common-sense way to protect the citizens of any state that has recently embraced recreational sales.
Medical students are taught to diagnose patients’ most obvious ailments first. This so-called Sutton’s law was named for bank robber Willie Sutton, who famously said he robbed banks “because that’s where the money is.” Today’s criminals go after cannabis dispensaries for the same reason. They can’t be allowed to do so in Rhode Island.
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