STAND. COM. REP. NO. 3788

Honolulu, Hawaii

RE: H.B. No. 1642

H.D. 1

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2026

State of Hawaii

Sir:

Your Committees on Judiciary and Ways and Means, to which was referred H.B. No. 1642, H.D. 1, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO CONSUMER PROTECTION,"

beg leave to report as follows:

The purpose and intent of this measure is to:

(1) Establish limits on transactions through digital financial asset transaction kiosks; and

(2) Require operators of digital financial asset transaction kiosks to meet certain requirements.

Your Committees received testimony in support of this measure from the Office of Consumer Protection of the Department of Commerce and Consumer Affairs, Policy Advisory Board for Elder Affairs, Department of the Prosecuting Attorney of the County of Maui, Hawaii Bankers Association, CoinFlip, AARP Hawaii, and twelve individuals.

Your Committees received testimony in opposition to this measure from one individual.

Your Committees received comments on this measure from Hilt Ventures and one individual.

Your Committees find that there is an increasing number of financial scams involving innocent citizens tricked into sending cash, gift cards, or wire transfers to criminals via phone or internet contact. Your Committees further find that digital financial asset transaction kiosks are another tool in a scammer's arsenal: they are the electronic equivalent of an ATM, but with the added danger that digital assets purchased at one of these kiosks may be immediately transferred to a scammer's digital wallet and are nearly impossible to recover. This measure will protect the State's residents by creating daily and monthly transaction limits on kiosk transfers by a single person, requiring multiple warnings and disclosures to consumers about digital assets in general, and imposing certain requirements on kiosk operators to ensure that the transactions at the kiosks are safe, secure, and legitimate.

As affirmed by the records of votes of the members of your Committees on Judiciary and Ways and Means that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 1642, H.D. 1, S.D. 1, and recommend that it pass Third Reading.

Respectfully submitted on behalf of the members of the Committees on Judiciary and Ways and Means,

________________________________ DONOVAN M. DELA CRUZ, Chair

________________________________ KARL RHOADS, Chair