Gift cards are a popular present – for giving and receiving – especially for last-minute shoppers or for people without a wish list.
Not all gift cards are created equal, though. It’s crucial to know the basics about gift cards – from expiration dates to potential scams – before making a purchase.
Both state and federal law protect gift cards. Under Ohio law, gift cards in any form — electronic, plastic, paper, etc. — generally cannot expire for at least two years. Under federal law, gift cards issued in electronic form for a specific amount cannot expire for a minimum of five years. Pay attention to a card’s expiration date, especially if you plan to buy a gift card from a reseller.
If a gift card has no expiration date, it is generally valid until redeemed or replaced with a new card. Nevertheless, it’s often best to use a gift card as quickly as possible to reduce its chances of being lost or stolen.
Keep in mind that a gift card that is branded by a credit card company and can be used almost anywhere may reduce in value faster than a single-store gift card.
There are a number of exceptions in the gift card laws. For example, gift cards for a specific service – say, one for a manicure (as opposed to a specified amount to a nail salon) – are not protected under federal law. Neither are “bonus” cards. Around the holidays, many businesses offer deals, such as “buy a $100 gift card, get a $20 gift card free.” Although the $100 gift card would have all the protections the law offers, the $20 gift card would not be subject to the protections and could expire at any time. Closely check the expiration dates and other restrictions of any bonus cards.
Gift cards are often a scammer’s payment of choice. For example, say you come across a legitimate-looking website advertising better deals than the sites of other stores. On the checkout page, however, the site requests the number of a gift card (not associated with the company) rather than a credit or debit card. Beware! Scammers may create phony websites — complete with made-up customer reviews — to trick people into revealing redeemable gift card information. Once the information is provided, any money loaded on the card will be lost.
When buying gift cards in a store, make sure that their PINs, generally found on the back of cards, aren’t already scratched off or appear to have been tampered with. Some scammers go into stores, scratch off PINs, record the numbers, and put the cards back on the shelf. Then they check to see whether a consumer has purchased (or put any funds on) one or more of the cards. If a card has money on it, scammers then attempt to drain it. Some scammers even replace the security film sticker – which can be bought in bulk – so the PIN does not appear to have been exposed. Look for signs that the security film has been replaced (i.e. if it has been applied crooked or has air bubbles).
Be sure to take note of when the gift cards you purchase are expected to be delivered. Then track their delivery so the cards aren’t snagged by mail thieves or accidentally disposed of.
Likewise, be careful when mailing gift cards to others. Consider taking those items directly to the post office instead of putting them in an unlocked mailbox to be picked up. Remember that once a thief has control of a physical or electronic gift card with the PINs, it may be very easy for the thief to redeem or transfer the full value of that card.
Consumers who suspect a scam or an unfair business practice should contact the Ohio Attorney General’s Office at
www.OhioProtects.org or 800-282-0515.