Bank of America revokes banking privileges of the Scottsdale Research Institute

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Bethan Rose Jenkins, Cannabis News Writer/Editorial

The Scottsdale Research Institute (SRI) has been forced to forfeit its banking privileges, after the Bank of America recently announced that it would be terminating the high-profile cannabis research institution’s financial lifeline.

Established and operated by former University of Arizona professor Dr. Sue Sisley, the SRI made news headlines early last year when the Drug Enforcement Agency (DEA) granted the institution authority to cultivate cannabis for the Food and Drug Administration (FDA). 

For years, Dr. Sisley has been advocating for medical cannabis research. Gaining U.S. government approval meant that things were moving in the right direction for her institution. Unfortunately for the founder (and the group as a whole,) the hunt for a brand new banking provider must now begin. 

The reality sunk in when Sisley received a letter on October 12 confirming that, three weeks after the initial notice, the SRI would be starved of its banking benefits. Moreover, Sisley announced that her institution’s account activity would be blocked on a permanent basis 30 days after the notice.

“There was no negotiating, no warning, no ability for us to speak to somebody who could review our operating agreement with DEA,” Sisley expressed with disappointment.

“We have a contract with the DEA: We are growing cannabis for FDA clinical trials and selling it to the DEA. [This is] further proof that the word ‘cannabis’ continues to be completely radioactive even though this is a 100 percent federally legal operation,” added Sisley, whose organization had been collaborating with the bank for over a decade.

In regards to the SRI and its efforts to research cannabis, Sisley believes that she and her team must now set their sights on the future and forget about the past. According to the professional psychiatrist, she has been on the receiving end of numerous “nice responses” from state banks that are still keen to continue supporting the SRI’s clinical trials.

“Fortunately, there are banks that care about the progress of federally regulated and federally legal research and are eager to step up and support us immediately. So we will be moving our funding from Bank of America and never returning. Our research continues without harm because other banks that care about scientific freedom were able to step up,” she declared.

Moving forwards, the SRI must cease from writing checks and cancel any continuing payments.

Bank of America is concerned about cannabis’ federally illegal status

There’s a good reason why the SRI has been instructed to discontinue check-writing and ongoing payments because the Bank of America is worried about facing potentially negative repercussions due to cannabis’ federally illegal status. 

Fortunately, things could change in the near future. Recently, congressional democrats added the Secure and Fair Enforcement (SAFE) Banking Act to the National Defense Authorization Act for FY 2022 with the primary goal of deterring Republican attempts to roadblock legalization attempts.

The SAFE Banking Act would effectively permit “legitimate” cannabis companies to access a broad scope of banking services just like any other legal business. On September 23, the bill was approved in the House as an element of the NDAA funding package with a vote of 316-113. It was introduced five times by House Democrats and now moves to the Senate. Bipartisan support is essential for its ultimate passing.

“With legalization polling at all-time highs and myriad states operating controlled markets for both medicinal and adult-use, it is past time for the cannabis industry to be able to enter into relationships with banks and other financial institutions,” said the director of Arizona NORML, Mike Robinette. “The SAFE Banking Act would enable state-licensed and legitimate cannabis businesses to be able to operate like all other legal businesses.”

Not all Democrats are supportive, however. Senate Majority Leader Chuck Schumer (D-NY) and Sherrod Brown (D-OH) remain optimistic that a more encompassing law will be introduced. Two potential examples include the Cannabis Administration and Opportunity Act and the Marijuana Opportunity Reinvestment and Expungement Act of 2021 (known as “H.R. 3884” or the “MORE Act.”)

JPMorgan Chase to curb purchases of cannabis-related stocks

In separate yet related news, JPMorgan Chase clients who maintain cannabis company roles have been informed that they can liquidate their shares. Based on the details of a letter issued by the bank, shares have been suitable for liquidation since November 8.

This latest move by the global leader in financial services emerged after Credit Suisse Group, a global investment firm, informed clients that it would be curbing cannabis-related transactions involving deals with U.S.-based companies. As a direct effect of this, cannabis stocks were sold-off in colossal quantities.

“JPMorgan’s new policy is regressive and at odds with the majority of Americans, who want legal, regulated cannabis. What’s more, it’s self-defeating. The end of federal cannabis prohibition is within sight, and the industry is already growing rapidly,” U.S. Cannabis Council CEO Steve Hawkins is quoted as saying in an official statement.

“I imagine more than a few JPMorgan customers will take issue with being blocked from one of the hottest industries on the market today. JPMorgan is on the wrong side of history on this and will come to regret its decision,” he added.

Moves like this suggest that the legal cannabis industry has a long way to go before it gains support from big-name companies. Consequently, industry players face an uphill battle until the plant is legalized at the federal level, should this ever happen.