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TUESDAY, DECEMBER 26, 2006
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Were you carded for Christmas?
Gift cards have caveats, so read the fine print

By Danielle Komis
danielle.komis@decaturdaily.com· 340-2447

You likely breathed a sigh of relief when Aunt Martha gave you a gift card to your favorite clothing store instead of the pea green sweater with purple unicorn applique she chose last Christmas.

However, while gift cards were a hot item this season, they have certain terms and conditions that the recipient may not always be aware of. This year, take care to make the most of your gift card and avoid any hidden fees or conditions, consumer advocates recommend.

Hidden fees

Some gift cards carry maintenance fees if the card isn’t used after a year, a fee for replacing a lost or stolen card, or a fee to check available funds. These fees are more common in gift cards called open-loop gift cards, which are issued by major credit card companies and can be used anywhere credit cards are accepted.

For example, if you received an iCard Visa Gift Card, you’ll be charged a $25 maintenance fee after six months.

If your gift card doesn’t have terms and conditions written on it, get your hands on that information so you can avoid any surprises down the road, said LeJuan George, a spokesman for the Better Business Bureau of North Alabama.

George emphasized that customers have the right to review all terms and conditions before a transaction is made.

“I can’t stress that enough,” he said. “If you stop and read the circumstances, that can help you in the long term.”

Expiration dates

Many gift cards, including “closed-loop” gift cards (those that can be used only at the retailer where they were purchased) also carry expiration dates that consumers may not notice in the fine print.

However, 13 states (Alabama isn’t one of them)have banned expiration dates, according to Bankrate.com, a web company that gathers financial information on more than 100 financial products. Those bans apply only to local retailers, though some national retailers have voluntarily opted to relinquish expiration dates.

To avoid any problems, read the fine print on your gift card. If it’s good for only six months, plan to use the card as soon as possible instead saving it for when you think you might need it more. Chances are, you may forget it’s in your wallet. Or worse, you may misplace it.

Scams

Popularity of gift cards has not escaped the attention of con artists. In a recent scam, thieves copy down gift card numbers, leave them at the store, wait for them to be activated, and then steal the balance by using the card numbers to order items online. Whoever bought one of those gift cards for you would be none the wiser for it.

To ensure that criminals haven’t touched your gift card, check the back of the card to verify that nothing has been scratched off, George said. Also, check the balance of the card to ensure that no one has used it without your knowledge.

If you think that your card has been tampered with, immediately report it to the issuing company.

Receipts

If whoever gave you the gift card also included the receipt with it, be thankful. Instead of wondering why she included it in the package, keep it in a safe place until you deplete the balance of the gift card. If the card is lost or stolen, the receipt might ensure that you won’t lose your money. Some companies will refund your money with a receipt.

Special conditions

Read the fine print when you use your gift card because there might be special terms of which you are not aware. For example, some gift cards can only be used at brick and mortar store locations and not online, or some may only be used for online purchases. Also, some gift cards for national chains may only be used at certain locations.

Rod Summers of Huntsville encountered this problem a few years ago when he bought his son John a gift card to Gap.

“We just assumed you could use it at Old Navy and Banana Republic (too),” Rod said, because the three retailers are all owned by Gap Inc. However, it turned out that it could only be used at Gap.

While there are many caveats that come with gift cards, they are generally still a great, safe gift. The North Alabama BBB receives only about 10 complaints on gift cards per month, George said. Linda Key of Hartselle said she gives and receives them often for Christmas and has never had a problem with them.

“I think they’re pretty good,” she said. “You can choose what you want and take it back if you don’t like it.”

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