Changing Laws On Mall Gift Cards



Posted: Tuesday, August 24, 2010

by Michael Goldstein, Esq.
Goldstein and Clegg LLC

Have you ever received a gift card for the mall or one of those pre-paid Visa or MasterCard, only to find out when you tried to use them that the card has expired, or due to the length of time, much of the funds were not available for your use? This is an unfortunate occurrence for many consumers. However, as of August 22, 2010, the Federal Credit Card Act has established a new set of rules and regulations relative to gift cards. The specific issues this new law tackles is relative to limiting penalty fees and rate increases, and expiration dates not listed on the card. There are several key changes to the law as it relates to these gift cards and gift certificates is that the law limits the expiration date to five years from the date of issue. So even if you have a card that indicates it is only good for a year, the issuing company will have to provide you with a new card should such a printed expiration occur less then five years from the date of purchase.

Additionally, just because you receive a gift card, does not mean you must use it right away or loose some of the value due to inactivity or service charge fees. More specifically, there must be no activity for over one year before such penalties can be assessed and even then only once per month can any funds be deducted.

Perhaps the most important aspect of the new law is the requirement for explicit written disclose of any penalties for certain uses on the face of the gift card. In addition, the contact information for the issuing company must be clearly identified on the card, so that should the user have any questions about any loss of funds, there is an indication of the proper company who is ultimately responsible. It should be noted though that cards produced before April of 2010 can still be sold on the open market until August 1, 2011.

The bottom line is that as consumer's and as gift givers, we are all protected against the big banks and other Creditor's selling us a bill of goods that can not be used for its intended purpose any longer.

For more information, check out the Consumer Debt Radio Blog
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