New federal gift card laws offer limited consumer protections when it comes to expiration dates and hidden fees; Florida law offers more. After that, you're best bet is reading fine print, checking store policies and asking questions. Golden rule: Use it before you lose it.
That's a lot of virtual cash for consumers to keep an eye on. Approximately $7 billion of gift cards went unclaimed last year, which means it's a waste of money if you or your recipient don't use them. And the faster, the better.
New federal gift cards took effect in August that offer more consumer-friendly help than in the past. While they only cover gift cards purchased after April, they save money by disallowing card-issuers to charge dormancy or inactivity fees for at least the first year. After that, there is no federal cap on what may be charged.
In addition, cards issued by stores must print the rules on the card, disclose them at the point of sale or offer a Website and toll-free number for customers to ask questions. But there's a catch: Stores don't have to do all three measures; they only have to pick one. So do your homework before you buy or as soon as you receive a gift card. Also, stores have until Jan. 31 to comply with the rule to print rules on cards.
What you else you should know:
Open vs. closed cards: The latest federal laws that took effect in August cover both "open-loop" cards, which may be used at multiple stores, and the "closed-loop" variety, which are to be used with a named merchant. The main difference is open-loop cards are covered by federal law and closed-loop by state.
Fees: Florida law, for instance, prevents card-issuers from charging any fees or inactivity, non-use or anything else on closed-loop cards.
Expiration: State law does not allow expiration dates on closed-loop cards. Exceptions include gift cards offered as a charitable contribution or through an employee-incentive program. The law allows open-loop cards to expire after five years.
Replacement: All gift cards must be replaced or refunded the remaining value upon request by a customer.
Complaints: If you have a complaint regarding a closed-loop gift card, call 800-435-7352 or visit 800helpfla.com. For an open-loop card call 800-613-6743 or visit HelpWithMyBank.gov.
Daniel Vasquez can be reached at email@example.com, or 954-356-4219, or 561-243-6600, ext. 4219. To see more columns from Daniel Vasquez, go to SunSentinel.com/vasquez.
Check out Daniel Vasquez's Consumer Talk blog for ways to spend your money wisely, use technology to make life easier and keep your family safe and healthy at SunSentinel.com/consumerblog.