Gift Cards are a Significant Source of Income for State Offices when They are Unredeemed

April 12, 2012 - PRLog -- As state governments try to balance their budgets, they are looking at all sources of potential income. One of these new sources are abandoned and unused gift cards. In the past, the companies that issued the gift cards we able to keep the money if the cards were not used. This is not the case anymore. Most of  the state offices have now included gift cards as unclaimed or abandoned property that must be handed over to them.

“Laws differ state by state, when it comes to when gift cards must be handed over to the state, so consumers must read all the fine print of these gift cards”, says Edward Palonek, founder of foundmoney.com, a company who pioneered finding unclaimed money on the internet back in 1995.

In New York, they collect gift cards 5 years after the date the card was last used (or 5 years after purchase if card was never used), they also collect both expired and unexpired gift cards, gift cards without expiration dates and gift cards before they expire if there has been 5 years of inactivity on the card.

Pennsylvania collects unredeemed gift cards two years after their expiration date or if they only have service fees and no expiration they collect it five years after the date of issuance. While in Virginia, if a gift certificate does not expire then it is not considered abandoned or unclaimed property. However, if it does expire, it is presumed abandoned five years after the last date of activity on the card.

According to Towergroup, sales of gift cards were approximately $100 billion in 2011 and another organization called, the National Retail Federation (“NRF”) estimates, that $27.8 billion was spent by consumers on gift cards during the past Christmas season.

According to Palonek, “unclaimed gift cards have become an untapped and significant source of income for the state treasuries”. For example, in New York, they received $9.6 million in unredeemed gift cards in 2010 and according to the New York state comptroller they returned only $2,150 to the rightful owners. Ron Schubin, director of reporting operations for the New York state comptroller says, that when the owner is unknown, “there’s nothing much we can do”.

“Not knowing the owner of the gift card is quite normal, since few retailers make an effort to gather the information on who the purchaser is, so to make sure that gift cards do not get handed over to the  the State or reported as income on a company’s balance sheet, simply use the gift card before it expires”, says Edward Palonek.

The new regulations under the Credit Card Accountability and Responsibility and Disclosure (CARD) Act limit Fees on Gift and Stored Value Cards. The Act enhances disclosure on fees for gift and stored value cards and restricts inactivity fees unless the card has been inactive for at least 12 months. The Act also requires, that cards be given at least five years of transaction capability before expiration.

Many folks could use some extra cash right now to start to pay down some debt. A quick and easy way is to simply do an online web search at www.foundmoney.com. There someone can check to see if they , a loved one, friend or neighbor has some unclaimed money just sitting there waiting for its rightful owner to make a claim for this cash.

Contact
Foundmoney at www.foundmoney.com
Edward Palonek at www.edwardpalonek.org

# # #

Each year, 1,000's of people lose track of their bank accounts, cash, stocks, bonds, refunds, royalties, safe deposit boxes and other property. Losing sight of property can happen to anyone. Foundmoney.com helps people re-unite with their unclaimed money