(a) Any Hawaii financial institution which, and any institution-affiliated party who:

Terms Used In Hawaii Revised Statutes 412:2-609

  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • Commissioner: means the commissioner of financial institutions of this State. See Hawaii Revised Statutes 412:1-109
  • Fiduciary: A trustee, executor, or administrator.
  • Financial institution: means a Hawaii financial institution, and unless the context indicates otherwise, a federal financial institution or foreign financial institution. See Hawaii Revised Statutes 412:1-109
  • Hawaii financial institution: means :

    (1) A corporation or credit union that holds a charter or license under this chapter or under prior Hawaii law, authorizing it to accept deposits, to make loans in excess of the rates permitted in chapter 478, or to engage in the business of a trust company; or

    (2) A resulting bank as defined in article 12,

    and includes a corporation or credit union existing and chartered as a Hawaii financial institution or licensed to transact business in this State on July 1, 1993. See Hawaii Revised Statutes 412:1-109

  • Institution-affiliated party: means any of the following:

    (1) Any director, officer, employee or controlling shareholder of, or agent for, or other person that controls a financial institution;

    (2) Any person who has filed or is required to file an application to become a financial institution with the commissioner or an application to acquire control of a Hawaii financial institution or financial institution holding company with the commissioner;

    (3) Any shareholder, consultant, joint venture partner, and any other person as determined by the commissioner (by rule or case-by-case) who participates in the conduct of the affairs of a financial institution; or

    (4) Any independent contractor (including any attorney, appraiser, or accountant) who knowingly or recklessly participates in any of the following which caused or is likely to cause more than a minimal financial loss to, or a significant adverse effect on, the financial institution:

    (A) Any violation of law or rule,

    (B) Any breach of fiduciary duty, or

    (C) Any unsafe or unsound practice. See Hawaii Revised Statutes 412:1-109

  • Person: means a natural person, entity or organization, including without limitation an individual, corporation, joint venture, partnership, sole proprietorship, association, cooperative, estate, trust, or governmental unit. See Hawaii Revised Statutes 412:1-109
(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.

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