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Attorney General Reyes Joins Coalition of 34 States Urging Congress to Allow Marijuana-related Business to Access the Banking System

FOR IMMEDIATE RELEASE
May 22, 2020

ATTORNEY GENERAL SEAN REYES JOINS COALITION OF 34 STATES URGING CONGRESS TO PASS LEGISLATION ALLOWING MARIJUANA-RELATED BUSINESS TO ACCESS THE BANKING SYSTEM
Utah Treasurer David Damschen and Utah Bankers Association in Support of This Effort

SALT LAKE CITY  –  The badly needed gap between federal regulations and the lack of access to financial institutions for medical and legal use marijuana businesses is being addressed with proposed federal legislation that has the support of Utah Attorney General Sean Reyes, Utah Treasurer David Damschen and the President of the Utah Banking Association, Howard Headlee.

Attorney General Reyes today joined a bipartisan coalition of 34 state and territorial attorneys general urging Congress to pass, as part of upcoming COVID-19 relief legislation the federal Secure and Fair Enforcement (SAFE) Banking Act (H.R. 1595) or similar measures that would give legal marijuana-related businesses access to the federal banking system.

“This bill would allow Utah to make critically needed changes regarding legal medical cannabis transactions in our state,” said Utah Attorney General Sean D. Reyes.  “Utah worked hard to find a sensible, humane and balanced approach to medical marijuana policy. But current federal law prevents access to insured financial institutions for businesses in this industry. That creates significant practical and public safety issues for both the general public and for Utah businesses legally operating in the medical cannabis space.” 
 
Utah Treasurer David Damschen said, “There is no silver bullet to address the cannabis banking problem on the state level. We need the federal government to respect the move among states toward varying degrees of legalization and to better harmonize its laws regarding cannabis-related activities, particularly with respect to banking regulation.”
 
Damschen continued, “The inability of insured financial institutions to handle cannabis-related transactions has forced businesses and governments throughout the U.S. to resort to cash to settle transactions. This represents an enormous public safety issue, increasing risk of violent crime, fraud, and theft. Providing regulated and insured financial services to cannabis businesses allows law enforcement, and specifically the Financial Crimes Enforcement Network (FinCEN) within the U.S. Department of Treasury, the transparency needed to distinguish legal cannabis businesses from illegal activity.”
 
Utah Banking Association President Howard Headlee said, “Utah Banks offer critical services for small businesses to deposit their daily receipts, manage cash flow, secure loans and protect assets.  The changes outlined in the SAFE Banking Act will allow the new medical marijuana businesses to operate just as every other law-abiding business does in our state.  We will be able to safely accommodate a sector that otherwise would be relegated to untenable methods just to operate normally.”
 
Under existing law, federal regulators prohibit financial institutions from providing services to marijuana businesses in states where medical or retail marijuana sales are legal. Forcing legal businesses to operate as cash-only operations poses serious safety threats, creating targets for violent and white-collar crime. The SAFE Banking Act permits marijuana-related businesses in states and territories with existing regulatory structures to access the federal banking system.

The SAFE Banking Act has widespread, bipartisan support with 206 cosponsors in the U.S. House of Representatives. The House passed the bill in September 2019. The HEROES Act relief legislation, which the House approved last week, also included the language of the SAFE Banking Act.
 
In their letter, the attorneys general note that the COVID-19 pandemic has shed new light on problems that the SAFE Banking Act is intended to remediate, including health and safety concerns stemming from frequent and large cash exchanges.
 
The full text of the letter can be read here.
 

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Third Set of Charges Filed Against Utah Man For THC Distribution

May 14, 2020

On Monday, the Utah Attorney General’s Office SECURE Strike Force filed charges against a man from Sandy, Utah for THC distribution. This is his third set of charges in less than a year for similar offenses.

21-year-old Anthony Studham has been charged in the Third District Court with Pattern of Unlawful Activity, a second-degree felony; two counts of Money Laundering, a second-degree felony; Distribution of a Controlled Substance, a second-degree felony; and Possession of a Controlled Substance With Intent to Distribute, a second-degree felony.

Studham was first arrested in January 2019 when he was found in possession of marijuana and THC cartridges. In October 2019, he pled guilty to Drug Possession, a third-degree felony, and two Class B misdemeanors. Studham was sentenced to one year of probation.

In November 2019, Studham was again arrested for possessing marijuana and illegal THC cartridges with the intent to distribute. In February 2020, he was charged with Distribution of or Arranging to Distribute a Controlled Substance, a second-degree felony; Possession of a Controlled Substance with Intent to Distribute, a second-degree felony; and Possession of Drug Paraphernalia, a Class B misdemeanor.

In April 2020, agents with SECURE received reports from the West Jordan Police Department about the ongoing investigation into Studham for distributing large amounts of THC cartridges and marijuana throughout the Salt Lake Valley. Studham would often advertise drug sales through his social media accounts and made frequent trips to California to pick up marijuana. Police seized $37,270 from his residence and $16,365 from his car, all believed to be the proceeds of drug sales.

Believing Studham poses a flight risk, the Court issued a warrant for his arrest and requested he be held without bail.

AG Reyes Urges Congress to Pass Legislation Allowing Marijuana-Related Business to Access the Banking System

FOR IMMEDIATE RELEASE
May 8, 2019

AG REYES JOINS COALITION OF 38 STATES URGING CONGRESS TO PASS LEGISLATION ALLOWING MARIJUANA-RELATED BUSINESS TO ACCESS THE BANKING SYSTEM

SALT LAKE CITYUtah Attorney General Sean D. Reyes today joined a bipartisan coalition of 38 states and territorial attorneys general urging Congress to pass the federal Secure and Fair Enforcement, or SAFE, Banking Act or similar measures that would give legal marijuana-related businesses access to the federal banking system.

“I urge Congress to be proactive and face the reality that legislation is crucial to providing structure to a business that’s growing exponentially,” Utah Attorney General Sean D. Reyes said. “In Utah, we need to address the business side of our state’s medical marijuana law. The Utah Legislature, Governor Gary R. Herbert, and State Treasurer David Damschen are equally invested in seeking a solution to this reality. If we don’t act, there could be serious issues for both state government and our financial institutions. This is both a public safety and state’s rights issue.”

Under existing law, federal regulators prohibit financial institutions from providing services to marijuana businesses in states where medical or retail marijuana sales are legal. Forcing legal businesses to operate as cash-only operations poses serious safety threats, creating targets for violent and white-collar crime. The SAFE Banking Act permits marijuana-related businesses in states and territories with existing regulatory structures to access the federal banking system.

The SAFE Banking Act has widespread, bipartisan support with 172 cosponsors in the U.S. House. The House Financial Services Committee approved the bill in March and now it awaits a vote by the full House.

With the backing of 38 of the nation’s attorneys general, the National Association of Attorneys General (NAAG) has chosen to endorse the legislation as one of its official policy positions. Historically, NAAG endorses less than a dozen policies a year.

The coalition of states and territories includes Alaska, Arizona, Arkansas, California, Connecticut, Colorado, Delaware, the District of Columbia, Guam, Hawaii, Illinois, Iowa, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nevada, New Jersey, New Mexico, New York, North Dakota, the Northern Mariana Islands, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, the U.S. Virgin Islands, Utah, Vermont, Virginia, Washington, West Virginia, and Wisconsin.

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NOTES:
1. Find the full text of H.R. 1595 – SAFE Banking Act of 2019 here: https://www.congress.gov/bill/116th-congress/house-bill/1595?q=%7B%22search%22%3A%5B%22SAFE+Banking+Act%22%5D%7D&s=1&r=

2. The full text of the NAAG letter to Congress can be read here: https://attorneygeneral.utah.gov/wp-content/uploads/2019/05/NAAG-Letter-SAFE-Banking-Act-of-2019.pdf

3. During the last Legislative Session, the Utah Senate presented a concurrent resolution urging legal medical cannabis banking in an effort to resolve this issue. You can read the entire resolution here: https://le.utah.gov/~2019/bills/static/SCR007.html

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