Penalties, Administrative Fines and

HRS div. 2, tit. 22, ch. 412, art. 2, pt. VI

in effect

HRS §412:2-600 Applicability of part

412:2-600. Applicability of part (a) The provisions of this part shall apply to all Hawaii financial institutions and to such other persons as shall, by violating any of the provisions of this part, be subject to the penalties and administrative fines provided in this part. The provisions of this part shall be in addition to the prohibitions set forth elsewhere in this chapter. (b) If a contract is made or any other act is done or omitted in good faith reliance on an interpretation of this chapter made by the supreme court of this State or in a rule duly adopted by the commissioner pursuant to chapter 91, no penalty imposed by this chapter shall apply, notwithstanding that after such contract is made, such interpretation or rule is amended, rescinded, or determined by judicial or other authority to be invalid for any reason. [L 1993, c 350, pt of §1]

HRS §412:2-601 Violation of chapter

412:2-601. Violation of chapter Any institution-affiliated party or any other person who wilfully violates any of the provisions of this chapter for which a penalty or administrative fine is not expressly provided in this chapter shall be guilty of a misdemeanor punishable pursuant to sections 706-663 and 706-640. [L 1993, c 350, pt of §1; am L 1998, c 196, §7]

HRS §412:2-602 Copying records of Hawaii financial institutions

412:2-602. Copying records of Hawaii financial institutions Any institution-affiliated party who knowingly copies without authorization any of the books, papers, records or documents belonging to or in the custody of a Hawaii financial institution, either for the party's own use or for the use of any other person other than in the ordinary and regular course of the party's duties, shall be guilty of a misdemeanor punishable pursuant to sections 706-663 and 706-640. [L 1993, c 350, pt of §1]

HRS §412:2-603 Disclosures of records of Hawaii financial institutions

412:2-603. Disclosures of records of Hawaii financial institutions Any institution-affiliated party who, without authorization, knowingly discloses, except in the regular course of business, any information derived from a Hawaii financial institution's records shall be guilty of a misdemeanor punishable pursuant to sections 706-663 and 706-640. [L 1993, c 350, pt of §1]

HRS §412:2-604 Concealment

412:2-604. Concealment Any institution-affiliated party who knowingly conceals or endeavors to conceal any transaction of the Hawaii financial institution from any director, incorporator, officer, agent or employee of the institution or any official or employee of the division to whom it should be properly disclosed shall be guilty of a misdemeanor punishable pursuant to sections 706-663 and 706-640. [L 1993, c 350, pt of §1]

HRS §412:2-606 Witness; failure to testify or produce records

412:2-606. Witness; failure to testify or produce records Any person who knowingly fails to attend and testify or answer any lawful inquiry or to produce books, papers, accounts, records, contracts, or documents, if in the person's power to do so, in obedience to the lawful subpoena or lawful requirements of the commissioner, or an examiner employed by the commissioner, shall be guilty of a misdemeanor punishable pursuant to sections 706-663 and 706-640. [L 1993, c 350, pt of §1]

HRS §412:2-606.5 Financial institution name fraud

412:2-606.5. Financial institution name fraud (a) No person shall use the name or trademark of a financial institution, as defined in section 412:1-109, or its affiliates or subsidiaries when marketing or soliciting existing or prospective customers if the marketing materials are used without the written consent of the financial institution and in a manner that would lead a reasonable person to believe that the material or solicitation originated from, was endorsed by, is related to, or is the responsibility of the financial institution or its affiliates or subsidiaries. (b) The commissioner may impose a civil penalty of up to $10,000 for each violation of this section. [L 2008, c 51, §2]

HRS §412:2-607 Deception; false statements

412:2-607. Deception; false statements (a) An institution-affiliated party who does any of the following shall be guilty of a class C felony punishable pursuant to sections 706-660 and 706-640: (1) With intent to deceive, makes any false or misleading statement or entry or omits any statement or entry required by law or rule to be made in any book, account, report or statement of the institution; or (2) Knowingly obstructs or endeavors to obstruct a lawful examination or investigation of the institution or any of its affairs by an official or employee of the division. (b) Any person who intentionally or knowingly makes, circulates, or transmits to another or others any statement or rumor, written, printed, or by word of mouth, which is untrue in fact and is directly or by inference derogatory to the financial condition or affects the solvency or financial standing of any Hawaii financial institution that is a depository financial institution, or who knowingly counsels, aids, procures, or induces another to start, transmit or circulate such statement or rumor, shall be guilty of a misdemeanor punishable pursuant to sections 706-663 and 706-640. (c) Any person who maliciously or for personal financial gain makes, circulates, or transmits to another or others any statement or rumor, written, printed, or by word of mouth, which is untrue in fact and is directly or by inference derogatory to the financial condition or affects the solvency or financial standing of any Hawaii financial institution that is a depository institution, or who maliciously or for personal financial gain counsels, aids, procures, or induces another to start, transmit or circulate any such statement or rumor, shall be guilty of a class C felony punishable pursuant to sections 706-660 and 706‑640. [L 1993, c 350, pt of §1]

HRS §412:2-608 Misapplication of funds

412:2-608. Misapplication of funds Any institution-affiliated party who wilfully abstracts or misapplies any of the money, funds, credits, assets, or property of a Hawaii financial institution, whether owned by the financial institution or held for safekeeping or as agent, or held in trust shall be guilty of a class C felony punishable pursuant to sections 706-660 and 706-640. However, if the amount abstracted or wilfully misapplied does not exceed $300, the institution-affiliated party shall be guilty of a misdemeanor punishable pursuant to sections 706-663 and 706-640. [L 1993, c 350, pt of §1]

HRS §412:2-609 Imposition of administrative fines; assessment

412:2-609. Imposition of administrative fines; assessment (a) Any Hawaii financial institution which, and any institution-affiliated party who: (1) Commits a material violation of any law or rule for which a penalty or fine is not expressly provided herein; (2) Commits a material violation of any order issued by the commissioner which has become effective; (3) Commits a material violation of any condition imposed in writing by the commissioner in connection with the grant of any application or other request by the financial institution; or (4) Commits a material violation of any written agreement between the financial institution and the commissioner; may be ordered by the commissioner to forfeit and pay an administrative fine of not more than $1,000 for each day during which the violation continues. (b) Notwithstanding subsection (a), any Hawaii financial institution which, and any institution-affiliated party who: (1) Commits any violation described in any clause of subsection (a); (2) Recklessly engages in an unsafe or unsound practice in conducting the affairs of the Hawaii financial institution; or (3) Breaches any fiduciary duty owed to the financial institution; which violation, practice, or breach is: (1) Part of a pattern of misconduct; (2) Causes or is likely to cause more than a minimal loss to the Hawaii financial institution; or (3) Results in pecuniary gain or other benefit to such party; may be ordered by the commissioner to forfeit and pay an administrative fine of not more than $5,000 for each day during which the violation, practice, or breach continues. (c) Notwithstanding subsections (a) and (b), any Hawaii financial institution which, and any institution-affiliated party who: (1) Knowingly commits any violation described in any clause of subsection (a); knowingly engages in any unsafe or unsound practice in conducting the affairs of the Hawaii financial institution; or knowingly breaches any fiduciary duty owed to the financial institution; and (2) Knowingly or recklessly causes a substantial loss to the Hawaii financial institution or a substantial pecuniary gain or other benefit to such party by reason of such violation, practice, or breach; may be ordered by the commissioner to forfeit and pay an administrative fine of not more than $100,000 for each day during which the violation, practice, or breach continues. The maximum administrative fine shall not exceed in the case of any person other than a Hawaii financial institution, the amount of $500,000 and in the case of any Hawaii financial institution, the lesser of $1,000,000 or one per cent of the total assets of the Hawaii financial institution. (d) Any administrative fine imposed under subsection (a), (b), or (c) may be assessed and collected by the commissioner by service of written notice and order upon the Hawaii financial institution or institution-affiliated party by means of certified mail, return receipt requested. If, with respect to any such assessment, a hearing is not requested pursuant to section 412:2‑610(c) within the period of time allowed under section 412:2‑610(c), the assessment shall constitute a final and unappealable order. [L 1993, c 350, pt of §1; am L 1994, c 107, §5; am L 1998, c 196, §8]

HRS §412:2-609.5 Imposition of administrative fines on persons who are not Hawaii financial institutions; assessment

412:2-609.5. Imposition of administrative fines on persons who are not Hawaii financial institutions; assessment (a) Any person, other than a Hawaii financial institution or an institution-affiliated party, who: (1) Commits a violation of any law or rule for which a penalty or fine is not expressly provided in this chapter; (2) Commits a violation of any order issued by the commissioner; (3) Commits a violation of any condition imposed in writing by the commissioner in connection with the grant of any application or other request by the person; or (4) Commits a violation of any written agreement between the commissioner and the person; may be ordered by the commissioner to pay an administrative fine of not more than $100,000 for each day during which the violation continues. (b) Any administrative fine imposed under subsection (a) may be assessed and collected by the commissioner by service of written notice and order upon that person at the person's last known home or office address by means of certified mail, return receipt requested. If, with respect to any such assessment, a hearing is not requested pursuant to section 412:2-610(c) within the period of time allowed under section 412:2-610(c), the assessment shall constitute a final and unappealable order. [L 1998, c 196, §1]

HRS §412:2-610 Compromise or modification of administrative fines; determining amount of fine; hearing

412:2-610. Compromise or modification of administrative fines; determining amount of fine; hearing (a) The commissioner may compromise, modify, or suspend any administrative fine which may be assessed or which has been assessed under this chapter. The commissioner may also exempt violations of informal enforcement actions from the administrative fines and penalties set forth in this chapter. (b) In determining the amount of any administrative fine imposed under this chapter, the commissioner shall take into account the appropriateness of the fine with respect to all of the following: (1) The size of financial resources and good faith of the financial institution or the person charged; (2) The gravity of the violation, practice, or breach; (3) The history of previous violations, unsafe or unsound practices, or breaches of fiduciary duty owed to the financial institution; (4) The extent to which a federal agency has, by imposing a fine for similar conduct, mitigated the need for imposition of a particular level of administrative fine under this chapter; and (5) Such other matters as justice may require. (c) The Hawaii financial institution or other person against whom any administrative fine is assessed under this chapter shall be afforded a hearing in accordance with chapter 91 if the financial institution or person submits a written request for a hearing within twenty days after the service of the notice of assessment. [L 1993, c 350, pt of §1; am L 1998, c 196, §9]

HRS §412:2-611 Action to recover administrative fines; deposit to compliance resolution fund

412:2-611. Action to recover administrative fines; deposit to compliance resolution fund (a) If any Hawaii financial institution, institution-affiliated party, or other person fails to pay an assessment after any administrative fine assessed under this chapter has become final, the commissioner shall recover the amount assessed by action in circuit court, in which case the commissioner may request the court to award reasonable attorney's fees and costs. (b) All administrative fines collected under authority of this chapter shall be deposited in the compliance resolution fund established under section 26‑9(o). [L 1993, c 350, pt of §1; am L 1996, c 207, §5; am L 1998, c 196, §10; am L 1999, c 129, §10]

Source: Hawaii State Legislature (capitol.hawaii.gov), via Internet Archive capturesURL: https://www.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0412/HRS_0412-.htmFetched: 11/10/2026