SB603 creates a new set of consumer-protection rules for people who, for compensation, advise, assist, or consult veterans on veterans benefits matters and who are not otherwise regulated under federal law. The bill prohibits paid referral arrangements, bars guarantees of outcomes, and requires any compensation agreement to be in writing before services begin. It also limits fees to contingent arrangements tied to an increase in benefits and caps successful compensation at no more than five times the monthly increase in benefits awarded, while prohibiting initial or nonrefundable fees.
The bill also requires a prominent written disclosure telling veterans that the business is not affiliated with the VA, the Hawaii Department of Defense, the Hawaii Office of Veterans' Services, or other veterans service organizations, and that free help may be available from public or federally chartered entities. Businesses must keep the disclosure signed and on file, and the bill adds advertising and privacy-related restrictions, including bans on international call centers for processing veteran information, use of veterans’ personal login credentials, and access by personnel who have not passed background checks. Violations are treated as unfair or deceptive acts or practices under Hawaii’s consumer protection laws.
SB603 would add a new part to chapter 363, Hawaii Revised Statutes, specifically regulating paid veterans-benefits advisors and related businesses. It also adds definitions for compensation, person, and veterans benefits matter, and reclassifies existing chapter 363 provisions as part I, signaling a new statutory framework for veterans-benefits services. The bill would not apply to accredited and regulated VA representatives, attorneys, or other federally regulated representatives, and it includes severability, nonretroactivity, and contract-impairment protections. The effective date is set far in the future, July 1, 2077, so the practical legal effect would be delayed unless amended.
The available voting history suggests the bill was received favorably in committee, passing the Senate Public Safety, Intergovernmental and Military Affairs committee 5-0 with amendments. The bill text itself reflects a protective, consumer-focused approach aimed at preventing exploitation of veterans seeking benefits assistance. No committee transcript is available here, but the overall framing indicates support for stronger oversight of paid veterans-benefits services.
The main points of potential contention are the bill’s restrictions on how veterans-benefits advisors may charge and market their services, especially the contingent-fee cap, the ban on upfront or nonrefundable fees, and the prohibition on paid referrals. Businesses in this space may also object to the disclosure requirements, privacy and data-handling limits, and mandatory background checks for anyone accessing veterans’ sensitive information. Another likely issue is the carve-out for federally accredited representatives, which preserves existing federal regulation while leaving some non-accredited service providers subject to the new state rules.