HB483 HD1

SECTION 1. Chapter 480F, Hawaii Revised Statutes, is amended by adding six new sections to be appropriately designated and to read as follows:

"§480F- License required. (a) No check casher shall engage in business without a license obtained pursuant to this chapter and rules prescribed by the director.

(b) The director shall prescribe the form of the license application. Each application shall be accompanied by the appropriate fee as prescribed by the director.

(c) No person shall be issued a license unless the person has passed a certified check casher examination. The check casher examination shall be in a form prescribed by the director; provided that the examination shall cover the following:

(1) Federal and state statutes and rules relating to check cashers; and

(2) General principles of business law.

(d) No person applying for a license shall have been convicted of a felony directly related to the operation of a check cashing agency, unless the conviction has been expunged or annulled. The Hawaii criminal justice data system shall provide such information to the director upon request.

§480F- Issuance of license. (a) Upon receipt of an application for a license to conduct business as a check casher, the director may issue a license if the applicant has met the requirements of this chapter.

(b) Every license issued shall be valid only as to the check casher and any branch offices the check casher may maintain.

(c) No license shall be issued to a check casher that establishes or maintains a place of business in, or conducts business from, a home, apartment, or hotel room unless otherwise approved by the director.

§480F- Licensing fee; biennial renewal; restoration. (a) No person applying for a license under this chapter shall be allowed to take the check casher examination until the appropriate fees have been paid to the director.

(b) Every licensee shall register with the director and pay a biennial renewal fee before June 30 of each even-numbered year. The failure, refusal, or neglect to pay a renewal fee shall constitute a forfeiture of the license. Any license forfeited under this section may be restored within one year of the forfeiture upon the filing of an application and payment of the renewal and restoration fees.

(c) A licensee who is not actively engaged in the business of a check casher, upon written request to the director, shall be placed on inactive status and shall be exempt from paying the renewal fee for the period in which the licensee is inactive. If the licensee resumes engaging in the business of check cashing, the licensee shall notify the director and remit the renewal fee for the current biennial period. While on inactive status, the licensee shall not engage in the business of check cashing.

(d) All licensing and renewal fees required to be paid under this section shall be established in rules adopted by the director pursuant to chapter 91.

§480F- Payment plans. (a) A check casher may enter into a payment plan with a non-default customer for a period of up to ninety days. Under the payment plan, no interest may be charged; provided that an administrative fee of $30 may be added to any fees or sums already owed by the customer. There shall be a thirty day period after the completion of any payment plan during which no new payment plan with that customer shall commence.

(b) A check casher shall offer an interest-free payment plan with a minimum term of sixty days to any customer who is in default. Any collection letter written to a customer in default shall inform the customer of the option of interest-free payment.

§480F- Records and reports. Every check casher shall keep records and make reports with respect to the operation of business as provided in rules adopted by the director pursuant to chapter 91.

§480F- Rules. The director, pursuant to chapter 91, shall adopt rules necessary to implement this chapter."

SECTION 2. Section 237-24.75, Hawaii Revised Statutes, is amended to read as follows:

"[[]§237-24.75[]] Additional exemptions. In addition to the amounts exempt under section 237-24, this chapter shall not apply to [~~amounts~~]:

(1) Amounts received as a beverage container deposit collected under chapter 342G, part VIII[.]; and

(2) Amounts received in fees and interest by check cashers for deferred deposit transactions."

SECTION 3. Section 480F-1, Hawaii Revised Statutes, is amended by adding a new definition to be appropriately inserted and to read as follows:

""Director" means the director of commerce and consumer affairs."

SECTION 4. Section 480F-2, Hawaii Revised Statutes, is amended to read as follows:

"[[]§480F-2[]] Posting and notice of fees charged. Any person who cashes one or more checks for a fee shall:

(1) Post in a conspicuous place in every location at which the person does business a notice that sets forth[:] in point type:

(A) The fees charged for cashing a check, for selling or issuing a money order, [~~and~~] for the initial issuance of any membership or identification cards[~~; and~~], and the fees and annual percentage rate for deferred deposit transactions;

(B) That consumer complaints about the check cashing business may be filed with the department of commerce and consumer affairs, and includes and identifies the telephone number and address of the consumer information service of the department of commerce and consumer affairs;

(D) That only one deferred deposit transaction can be opened from all sources;

(E) Information on where to obtain financial education and credit counseling; and

(F) A copy of the license to do business as a check casher as required by this chapter;

(2) Provide written notice [~~to each customer of the fees charged for cashing checks~~] in point type to each customer, that is separate from and in addition to any posted notice[;], containing the following information:

(A) The fees and annual percentage rate to be charged for a deferred deposit transaction;

(D) That only one deferred deposit transaction can be opened from all sources;

(E) That an extended repayment plan option is available after any customer has entered into four or more consecutive transactions with the same check casher; provided that the customer requests the option within twenty-four hours of the customer's last payment due date. For purposes of this subparagraph, "consecutive transactions" means back to back transactions occurring within twenty-four hours of each other;

(F) The right to rescind a deferred deposit transaction within twenty-four hours of the transaction; and

(G) Where to obtain financial education and credit counseling;

(3) Obtain a written acknowledgment from the customer that written notice of [~~the fees charged for cashing checks~~] all information required to be provided by paragraph (2) was provided[;] to the customer; and

(4) Provide each customer a receipt documenting any and all fees charged."

SECTION 5. Section 480F-4, Hawaii Revised Statutes, is amended by amending subsections (c), (d), and (e) to read as follows:

"(c) The face amount of the check shall not exceed $600 and the deposit of a personal check written by a customer pursuant to a deferred deposit transaction may be deferred for no more than thirty-two days. A check casher may charge a fee for deferred deposit of a personal check in an amount not to exceed fifteen per cent of the face amount of the check. The total amount of a transaction, including principal and fees, shall not exceed twenty-five per cent of the customer's gross monthly income. Any fees charged for deferred deposit of a personal check in compliance with this section shall be exempt from chapter 478.

(d) A check casher shall not enter into an agreement for deferred deposit with a customer during the period of time that an earlier agreement for a deferred deposit for the same customer is in effect[.] from any source. A deferred deposit transaction shall not be repaid, refinanced, or consolidated by or with the proceeds of another deferred deposit transaction.

(e) A check casher who enters into a deferred deposit agreement and accepts a check passed on insufficient funds, or any assignee of that check casher, shall not be entitled to recover damages in excess of principal, interest, and out-of-pocket legal costs in any action brought pursuant to or governed by chapter 490. No additional interest may be collected except the ten per cent allowed by law on uncollected judgments. Instead, the check casher may charge and recover a fee for the return of a dishonored check in an amount not greater than [~~$20.~~] $30."

SECTION 6. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 7. This Act shall take effect on January 1, 2050.

HOUSE OF REPRESENTATIVES	H.B. NO.	483
TWENTY-FOURTH LEGISLATURE, 2007		H.D. 1
STATE OF HAWAII