03 June 2011

Bligh Government to crack down on retailers dudding customers over gift cards


A CRACKDOWN looms on retailers who dud customers out of left-over cash on gift cards.

They also face bans on demanding people spend more money to redeem their gifts and on setting unreasonable expiry dates.

 The Bligh Government's move comes amid growing concern that some retailers are setting unfair and unspecified rules, then pocketing unredeemed cash.

 A recent survey found more than $1.5 billion was spent annually on gift cards but only about half of people who received them got to spend the full amount.

 Deputy Premier Paul Lucas said he would today pursue nationwide laws to govern gift cards at a meeting of consumer ministers.

 But Mr Lucas has threatened that Queensland will go it alone if there is no agreement.

 "Most of these companies operate across state boundaries and going it alone as a state is not ideal," he told The Courier-Mail yesterday.

 "But neither is the current situation where consumers are being dudded and large retailers are pocketing the gains without supplying anything in return."

 The Office of Fair Trading is investigating best practice for gift card terms and conditions in other jurisdictions.

 The US has set a five-year minimum expiry date on gift cards while some US states have banned expiry periods altogether. Some also have introduced laws banning fees and requiring retailers to offer consumers cash for any unused funds.

 A survey by consumer group CHOICE found expiry dates set by Australian retailers varied between six months and two years. Only hardware chain Bunnings issued gift cards that did not expire.

 It was reported that thousands of people with gift cards from ailing book store chains Borders and Angus and Robertson were unable to use them and were asked to spend more money to redeem any of the gift card value.

 A CHOICE spokeswoman, Ingrid Just, said the group had mounting concerns about the lack of rules surrounding the use of gift cards.

 "Many consumers are not aware that the gift card sitting in their wallets . . . had a three-month usage date on it," she said. "And essentially that money is lost."

 Ms Just backed moves towards a minimum period in which cards must be honoured and rules requiring greater disclosure of conditions.

 Mr Lucas said some retailers were doing the right thing but laws were needed to ensure all consumers got value for money.

 "When you buy a gift card for someone, you expect that you will get value for money and that they will be able to use the gift card's total amount when and on what they like," he said.

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