Bill > SB985

This bill addresses gift card fraud and consumer protection by establishing new requirements for merchants and third-party gift card resellers. The legislation was motivated by increased gift card scams during the COVID-19 pandemic, particularly a technique called "gift card draining" where scammers steal card information from store displays before consumers purchase them. The bill requires merchants to keep gift cards in locked display cases, use secure packaging that prevents tampering, and display warning notices about potential scams. For in-person sales, open-loop gift cards (those usable at multiple merchants) must be in packaging that conceals activation codes, while closed-loop gift cards (usable at a single merchant) must have tamper-resistant packaging. Third-party gift card resellers must now maintain detailed transaction records for at least three years, including seller and buyer information, gift card details, and transaction specifics. The bill also extends the minimum redemption period for paper gift certificates from two to four years and mandates that merchants provide training to employees on identifying and preventing gift card fraud. Additionally, the Office of Consumer Protection must create model notices and guidelines to help consumers understand and avoid gift card scams. These provisions aim to increase transparency, protect consumers from fraud, and provide clearer information about gift card terms and conditions.

Business and Industry, Justice

https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=SB&billnumber=985&year=2026