Business

Saturday, Dec 08 2012 12:00 PM

Action Line: Check gift cards' fine print

BY JOEY FERNANDEZ Contributing columnist

Editor's note: Action Line is a weekly column from the Better Business Bureau answering consumers' questions and concerns about money and business issues.

Dear Action Line:

I have family all across the U.S. and I'm trying to purchase gifts for all of them. I am considering sending everyone a gift card and be done with it!

But my sister keeps warning me about deceptive practices with certain businesses and websites offering gift cards. Giving a gift card is harmless, right?

Dear Reader:

Gift cards may seem like the perfect one-size-fits-all gift. But the Better Business Bureau serving Central California advises consumers to check the fine print on gift cards and make sure security seals are intact before buying them for holiday gifts.

With more families spread across the nation -- or even around the globe -- shoppers may see gift cards as an attractive way to remember loved ones over the holidays while avoiding the hassle of finding the right size or saving on shipping costs. In recent years, gift card sales in the United States have approached $100 million per year, with many of the cards bought in the last week before the holidays.

The Credit Card Accountability, Responsibility and Disclosure Act, which took effect in 2010, provides some protections to consumers who receive gift cards, such as requiring that card balances remain valid for five years after issuance or after they were last loaded with money. Fees and expiration dates may still apply, however, and fees can erode the value of the cards.

Gift cards may seem like a good alternative to buying and shipping presents, but it pays to read the fine print before you buy one. You may be better off giving cash or a check instead of plastic.

Some retailers offer gift cards online that can be delivered directly to the recipient. The BBB encourages consumers to be sure that the website where they buy gift cards is secure and check for any limits on how the cards may be redeemed. A secure website will display "https://" in the website address of the pages where a shopper enters payment information.

If the website displays a BBB Accredited Business seal, click on the seal to confirm that it is authentic. A valid seal will link to the firm's BBB Business Review.

More BBB tips on buying gift cards:

* Be cautious about buying gift cards from online auctions because it is virtually impossible to tell whether the cards have any value remaining, to determine whether they've been tampered with or to see if they've expired.

* When buying gift cards in a store, check the packaging and any security seals to be sure they are intact and haven't been tampered with.

* Check the fine print to see if there are fees associated with the card. Some typical fees could include transaction fees or inactivity fees.

* See if the card has an expiration date. In some cases, the plastic card may expire before the five-year redemption period. Are there fees to obtain a new card?

* Check the terms and conditions on a gift card. If you are giving a card to a friend who wants to shop online, make sure the card can be used that way and not just in a store.

* Consider the financial condition of the retailer or bank issuing the card. If you think the store may be on shaky footing, you may want to pass on buying a card.

-- Joey Fernandez is assistant director of business services for the Better Business Bureau serving Central California. Send your consumer concerns, questions and problems to Action Line at the Better Business Bureau, 1601 H St., Suite 101, Bakersfield, CA 93301 or joey@cencal.bbb.org. These are her opinions, not necessarily those of The Californian.

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