A rack at a store sells several store-branded gift cards. Credit: flickr/cc/Litandmore
In New Jersey, a new law poised to go into effect later this year would allow the balance of your unused gift cards to go directly into the coffers of the Treasury Department if unused after two years.
In 2011, the state seized approximately $79 million worth of “unclaimed property” under a law that was passed which applies to gift cards, unused travelers’ checks and money orders. At the time the law was first passed, there was a huge public outcry and an injunction was set against the collection of Zip Codes at the point of purchase. This was the pertinent information needed to keep records of which gift cards were being bought in the state and ultimately, which ones if gone unused could be seized by the Treasury Department.
The injunction has since been lifted and now companies like American Express have pulled its gift cards from the shelves of pharmacies, supermarkets and convenience stores with similar third party suppliers of gift cards set to follow suit. They claim that the nature of an American Express gift card is inherently different than that of a store-branded card in that it acts more or less as a substitute for cash and does not have an expiration date. Of course, the state allows for persons to appeal to the state to reclaim the seized assets only after the parties have sufficiently filled out the proper forms.
It has been well documented that the amount of unused gift cards nationwide is in the billions of dollars annually, but does the state have any right to that money? If the Treasury Department claims the right to an American Express cash card, what’s to stop them from unused bank accounts or credit card balances? Should companies that offer gift cards simply stop the policy of an expiration date?
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