WASHINGTON, D.C. – Yesterday, the Federal Deposit Insurance Corporation (FDIC), Office of the Comptroller of the Currency (OCC), the Federal Reserve Board, the Financial Crimes Enforcement Network (FinCEN) and the Conference of State Bank Supervisors issued guidance clarifying the legality of industrial hemp and the requirements for banks servicing hemp-related businesses.
Congressman Barr requested this guidance from the regulators through his role as a senior member of the House Financial Services Committee. The guidance would provide clarity for financial services firms who want to work with this booming industry, but are unclear of the rules-of-the-road following the legalization of industrial hemp in 2018.
The 2018 Farm Bill, which Congressman Barr supported, legalized industrial hemp and hemp-related products. Despite the legalization, many hemp-related businesses are facing challenges in accessing banking services.
“I want to thank the regulators for issuing this guidance and for their responsiveness to my requests. This is an important step to help the hemp industry in Kentucky thrive, but there is still work to do.”
During a House Financial Services Committee hearing today, Congressman Barr thanked the regulators for their announcement, but urged them to expand the guidance to provide legal certainty for payment processors serving hemp-related businesses. Congressman Barr has heard from constituents that uncertainty about the legality of payment processing for hemp-related businesses remains a problem facing the industry.
Ensuring that hemp-related businesses in Kentucky have access to capital and can grow remains a priority for Congressman Barr. Earlier this year, Congressman Barr authored amendments to the Secure and Fair Enforcement (SAFE) Banking Act (H.R. 1595) to make it easier for the hemp and CBD industries to access banking and financial services. The bill would allow banks, insurance companies, card processors and other financial services companies to serve legally-operating cannabis businesses. Congressman Barr’s provisions apply the same safe-harbors and clarifications in the broader bill explicitly to hemp and CBD businesses. The House passed that bill with Congressman Barr’s amendments in September.
“Kentucky’s congressional delegation continues to be a strong advocate for the Commonwealth’s growing hemp industry,” said Kentucky Agriculture Commissioner Ryan Quarles. “One such champion is Congressman Andy Barr, who has consistently worked to get hemp businesses the clarity they need to thrive. I thank him for his using his position on the Financial Services Committee to deliver results for Kentucky.”
Watch Congressman Barr’s questioning from today’s Financial Services Committee meeting here.