Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committees on Commerce, Consumer Protection, and Housing and Media, Arts, Science, and Technology, to which was referred S.B. No. 1170 entitled:

beg leave to report as follows:

The purpose of this measure is to establish the offense of abuse of commercial electronic mail.

The Office of the Public Defender submitted comments on the measure.

This measure addresses the problem of "phishing", a scam in which cyber criminals attempt to steal a consumer's personal financial information such as credit card numbers, passwords, and account information by posing as a bank, credit card company, or other legitimate business, and transmitting a request for this information through bogus electronic mail messages (emails) from a website that appears to be authentic. The Anti-Phishing Working Group, an organization whose members include banks, Internet service providers, and technology vendors, recorded 1,142 "phishing" sites in October 2004, and report that spoofed sites are multiplying at a rate of twenty-five per cent per month, with up to five per cent of recipients responding to these bogus emails.

This measure proposes to criminalize the act of "phishing" by establishing the offense of abuse of commercial electronic mail, and provides for civil remedies, in addition to criminal penalties.

Your Committees have amended this measure by replacing its contents with language that establishes the Hawaii Anti-Phishing Task Force within the Department of the Attorney General to examine options to prevent electronic commerce-based crimes in the State. The Task Force, comprised of representatives from state and federal law enforcement, the Office of Consumer Protection, the Legislature, and the financial services industry, is required to submit its findings and recommendations to the 2006 Legislature.

As affirmed by the records of votes of the members of your Committees on Commerce, Consumer Protection, and Housing and Media, Arts, Science, and Technology that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 1170, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 1170, S.D. 1, and be referred to the Committee on Judiciary and Hawaiian Affairs.