Dusty gift cards, real money: what to know before you toss them – Atlanta News First

Dusty gift cards, real money: what to know before you toss them  Atlanta News First

Federal law keeps funds alive for years but not if the store closes | Why local-shop cards carry the most risk, and what to do instead. ATLANTA, Ga. (Atlanta News First) – Forgotten gift cards often sit unused for years, and consumer protections vary depending on where the card came from. Buying gift cards from locally owned businesses carries risk. If the card is for someone who shops there regularly, that is not a problem. If the store goes out of business, no federal law requires it to pay the cardholder back. A cardholder can attend the bankruptcy hearing and file as an unsecured creditor, but there is about a 99% chance the money will not be recovered.

The federal Credit Card Accountability Responsibility and Disclosure (CARD) Act, passed by Congress in 2009, does not protect consumers if a business closes. It does provide other rights: These protections apply to store gift cards, gift certificates and general-use prepaid cards. As an alternative to a gift card, a gift without terms or an expiration date, such as a picture frame, can be exchanged, returned or regifted at the recipient’s choice. Under the CARD Act, codified in Regulation E, Section 1005.20 of the Consumer Financial Protection Bureau’s rules, issuers cannot charge a dormancy, inactivity or service fee unless there has been no