(a) It shall be a violation of this chapter for a licensee; its control persons, executive officers, directors, general partners, managing members, employees, or independent contractors; or any other person subject to this chapter to:
Terms Used In Hawaii Revised Statutes 480J-45
Consumer: means a natural person who is the buyer, lessee, or debtor to whom credit is granted in a transaction that is primarily for that natural person's personal, family, or household purposes. See Hawaii Revised Statutes 480J-1
Control: means the power, either directly or indirectly, to direct management or policies of a company, whether through ownership of securities, by contract, or otherwise. See Hawaii Revised Statutes 480J-1
Division: means the division of financial institutions of the department of commerce and consumer affairs. See Hawaii Revised Statutes 480J-1
Financial institution: means any bank, savings bank, savings and loan association, financial services loan company, or credit union doing business in the State whose accounts are insured by the Federal Deposit Insurance Corporation, the National Credit Union Share Insurance Fund, or other similar or successor program of federal insurance. See Hawaii Revised Statutes 480J-1
Fraud: Intentional deception resulting in injury to another.
Instrument: means a method of payment that may include a debit card payment, Automated Clearing House transfer, electronic check or other forms of electronic transfers, money order, cash, personal check signed by the consumer, or any other method of loan payment authorized by this part or by rule adopted by the commissioner pursuant to chapter 91 and made payable to a person subject to this chapter. See Hawaii Revised Statutes 480J-1
Interest: means all charges payable directly or indirectly by a borrower to a licensee as a condition to a loan or an application for a loan, however denominated. See Hawaii Revised Statutes 480J-1
lender: means any person who is in the business of offering or making a consumer loan, who arranges a consumer loan for a third party, or who acts as an agent for a third party, regardless of whether the third party is exempt from licensure under this chapter or whether approval, acceptance, or ratification by the third party is necessary to create a legal obligation for the third party, through any method including mail, telephone, the Internet, or any electronic means. See Hawaii Revised Statutes 480J-1
Licensee: means a person who is licensed or required to be licensed under this chapter. See Hawaii Revised Statutes 480J-1
Person: means an individual, sole proprietorship, partnership, corporation, limited liability company, limited liability partnership, or other association of individuals, however organized. See Hawaii Revised Statutes 480J-1
Personal property: All property that is not real property.
(1) Engage in any act that limits or restricts the application of this chapter, including:
(A) Disguising an installment loan as a leaseback transaction or a personal property, personal sales, or automobile title loan; or(B) Disguising loan proceeds as cash rebates for the pretextual installment sale of goods and services;(2) Make an installment loan that requires collateralization, a security interest, or any other pledge of personal property from the consumer;(3) Use a consumer’s account number to prepare, issue, or create a check on behalf of the consumer;(4) Charge, collect, or receive, directly or indirectly, charges:
(A) For negotiating forms of loan proceeds other than cash;(B) For brokering or obtaining loans;(C) Prepayment fees, or any fees, interest, or charges in connection with an installment loan except those explicitly authorized in this chapter;(5) Fail to make disclosures as required by this chapter or any other applicable state or federal law, including rules or regulations adopted pursuant to state or federal law;(6) Directly or indirectly employ any scheme, device, or artifice to defraud or mislead any consumer, lender, or person;(7) Directly or indirectly engage in unfair or deceptive acts, practices, or advertising in connection with an installment loan;(8) Directly or indirectly obtain property by fraud or misrepresentation;(9) Make an installment loan to any person physically located in the State through the use of the Internet, facsimile, telephone, kiosk, or other means without first obtaining a license under this chapter;(10) Make, in any manner, any false or deceptive statement or representation, including with regard to the rates, fees, or other financing terms or conditions for an installment loan, or engage in bait and switch advertising;(11) Make any false statement or knowingly and wilfully omit any material fact in connection with any reports filed with the division by a licensee or in connection with any investigation conducted by the division;(12) Advertise any rate of interest without conspicuously disclosing the annual percentage rate implied by that rate of interest or otherwise fail to comply with any requirement of the Truth in Lending Act, or any other applicable state or federal laws or regulations;(13) Make installment loans from any unlicensed location;(14) Draft funds from any depository financial institution without written approval of the consumer; provided that nothing in this paragraph shall prohibit the conversion of a negotiable instrument into an electronic form for processing through the Automated Clearing House or similar system;(15) Attempt to collect from a consumer’s account after two consecutive attempts have failed, unless the licensee obtains new written authorization from the consumer to transfer or withdraw funds from the account;(16) Make a loan to a consumer that includes a demand feature that was not clearly disclosed in the written agreement pursuant to section 480J-3 or collect or demand repayment of any outstanding balance or unpaid interest or fees except as provided in section 480J-3;(17) Fail to comply with any applicable state or federal laws relating to the activities governed by this chapter; or(18) Fail to pay any fee, assessment, or moneys due to the department.(b) In addition to any other penalties provided for under this chapter, any installment loan transaction in violation of subsection (a) shall be void and unenforceable.
