Gift Card Scams Outrage Comptroller

Certificates Expire Or Lose Value In Short Period Of Time

ANNAPOLIS, MD (February 2, 2005) –Comptroller William Donald Schaefer is fed up with gift cards ripping off the consumer and is supporting proposed legislation that would regulate their use in Maryland stores. The former governor has also sent a letter of concern to Attorney General J. Joseph Curran, Jr. strongly encouraging him to take a leadership role in correcting this problem. The Attorney General responded indicating support for the legislation.

According to published reports, gift certificates were the number one choice of givers this holiday season, surpassing even cash and clothing. This has raised a consumer protection issue, with customers finding that their gift certificates expired in a very short period of time or would lose value the longer the card was kept and not used. Comptroller Schaefer discovered this problem himself. He received a gift card for a local grocery store and upon attempting to use it, found that half of its value was lost due to the time that had passed since the card was purchased. “This is an outrage,” states Comptroller Schaefer. “I can think of no reason at all for unreasonably short expiration dates and fees on gift certificates for which consumers have paid face value.”

While there may well be business justification for expiration dates and other limitations on discount coupons, rebates and similar promotions, the Comptroller does not think these should apply to gift cards. Some members of Maryland’s legislature agree and have taken steps to address this issue. Senate Bill 8, introduced by Senator Klausmeier and other members of the Senate, would prohibit a person from selling a gift certificate that contains an expiration date of less than five years or service fee unless specified conditions were met. “This legislation has my full support,” said Comptroller Schaefer.

“The consumers must be protected!”

CONTACT:

Michael D. Golden 410-260-7305

Karen Sweeney 410-260-7252