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Read The Fine Print On Your Holiday Gift Cards

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With the giving of gift cards during the holiday season increasing in popularity, New York State Comptroller Thomas P. DiNapoli is urging New Yorkers to read the fine print for details about fees and expiration dates. Even as some sellers of gift cards have eliminated inactivity fees, consumers should still ask whether fees apply. DiNapoli reminds New Yorkers to spend the gift cards in a timely fashion. If not, the money could eventually get turned over to his Office of Unclaimed Funds.

“After the holidays, it’s easy to lose track of your gift cards,” DiNapoli said. “In 2020, over $16 million worth of unused gift cards were received in our office. To help stop this from happening to you, register the card with the retailer. It could help to get a replacement card if it is lost and could also help recover any unused balance if it’s reported to us as unclaimed funds. It is important not to wait too long to spend your gift cards to avoid inactivity fees.”

After five years of dormancy, money from unused gift cards issued by New York businesses is turned over to DiNapoli’s office as abandoned property. Under the federal Credit Card Accountability Responsibility and Disclosure Act of 2009, many types of retail gift cards sold after August 22, 2010, are not permitted to charge inactivity fees unless the card has been inactive for at least 12 months. All terms and conditions for a card must be disclosed directly on it and gift cards cannot expire within the first five years after purchase. New York law provides that gift cards cannot be assessed a monthly service fee against the balance prior to two years or the 25th month of inactivity.

Since January 2011, New York has required companies offering rebates to disclose whether they will be issued in the form of a gift card and whether any fees will apply to those cards. Rebate cards are not all covered by the same rules as regular gift cards, so this disclosure helps consumers to identify the different cards and how they can be used.

Gift cards may have other terms and conditions that can decrease the value. These may include:

  • Service fees when the card is purchased;
  • Dormancy fees if the gift card is not used within a certain time period;
  • Fees to call and check the balance remaining on the card; and
  • Replacement fees for lost or stolen gift cards.

DiNapoli’s office is currently holding more than $16 billion in unclaimed funds. He urges New Yorkers to visit osc.state.ny.us to see if they are owed money.