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Health & Fitness

Gift Cards: Shop Smart This Holiday Season

Tips to avoid scams and make the most out of gift cards

For many shoppers, gift cards provide an easy way to make sure that everyone gets a gift that he or she wants. While Connecticut law prohibits the use of expiration dates or inactivity fees for gift cards or gift certificates, federally chartered banks issuing cards in Connecticut have in certain cases been able to circumvent those protections for consumers. When you receive a gift card or you’re preparing to buy one, it’s always best to know exactly what you’re getting. As we enter the holiday season, these tips offered by the Connecticut Better Business Bureau should be useful for everyone who buys or receives gift cards:

Know your rights. Recent federal rules are designed to protect consumers by restricting fees and changing conditions regarding gift card expiration dates. These new rules apply to two types of cards: retail gift cards, which can be redeemed only at retailers and restaurants that sell them, and bank gift cards, which carry the logo of a payment card network like American Express, Visa, or MasterCard and may be used wherever those brands are accepted. More information on the new rules is available from the Federal Reserve at http://www.federalreserve.gov/consumerinfo/wyntk_giftcards.htm.

Check the source. Check out any business at www.bbb.org to make sure you’re buying from a known and trusted source. Avoid online auction sites that promise “full value guaranteed” gift cards. Some sites of this type have been reported to sell cards that are valueless, counterfeit, expired, or obtained fraudulently.

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Inspect the packaging and the card. Be on the lookout for gift cards that appear to have been removed from their packaging, are approaching their expiration date or have already expired. Verify that no protective stickers have been removed and that the protective layer on the back of the card hasn’t been scratched off to reveal a PIN number. Report any damaged cards on display to the seller.

Read the fine print before buying. Is there a fee to buy the card? Are there shipping and handling fees for cards bought by phone or online? Will any fees be deducted from the card after it is purchased?

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Provide the recipient with back-up. Give the recipient the original receipt in case the card is later lost or stolen. Also, before you buy retail gift cards, consider the financial situation of the retailer or restaurant. A card from a business that files for bankruptcy or goes out of business may be worthless. If the business closes a store near the recipient, it may be hard to find another location where the card can be used. A business that files for bankruptcy may honor its gift cards, or a competitor may accept the card. If this happens, call the business or its competitor to find out if they are redeeming the cards, or will do so at a later date.

Treat the gift card like cash. For recipients, it’s important to report lost or stolen cards immediately to the issuer. Some issuers may not replace them, while others will, for a fee. Make sure to use gift cards as soon as possible; it’s not unusual to misplace or forget about them.

To verify the reliability of a company or identify trustworthy businesses, visit the Better Business Bureau’s site at www.bbb.org.

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