Sitting in the state's Unclaimed Property vault is $6 million worth of expired gift cards, half of which were sent in by businesses within the last year. Businesses in Colorado are required to turn in the value of any gift card of more than $25 to the state five years after its purchase if it has not been redeemed. That means if you have one of those old gift cards, you can go to the Treasurer's office and redeem it there.
"Right now, under Colorado law, gift cards (of more than $25) are as good as cash," said Kennedy. "So, you can give a gift card knowing it is not going to expire. You can always redeem your money."
If the gift card was worth $25 or less, there is no recourse for consumers.
"We now have over a million names of people in our (Unclaimed Property) database. We hold their property. We'd like to give it back," she said.
Many outlets which had charged dormancy fees on gift cards if they were not used in a specific period of time are also re-thinking that policy, Kennedy said, because Colorado's financial statutes prevents it. Businesses which do not turn over unused gift card revenues to the state after five years could be subject to audits in order to continue doing business in Colorado.
Click here to visit the Colorado State Treasurer's Unclaimed Property Web site.
State lawmakers are also eyeing ways to help Colorado consumers when it comes to gift cards. Rep. Mark Ferrandino (D-Denver) is exploring possible legislation to require those who sell gift cards to clearly articulate the rules and fees included with them, much the way retailers highlight return policies. Further, he's looking at preventing any gift card from expiring until at least five years after it's bought.
"People need the right to know what they're buying and it should be stated clearly when they're buying it," said Ferrandino. "People who don't use their cards for a year or two shouldn't lose their money.
"People are paying for a service. You haven't provided the service for them (and) you have a card for them, but you haven't provided any goods. Why should that expire?" he said.
Gift card sales continue to increase year after year with the National Retail Foundation estimating $26 billion in gift card sales this year. That comes out to every consumer buying three to four this holiday season, said Chris Howes, who runs the Colorado Retail Council.
Consumer Reports estimates that $8 billion in gift cards will never be used, creating a huge profit for businesses, but Howes says that's not the fault of the retail industry.
"We've heard nothing from customers that there's ongoing problems with respect to gift cards," said Howes. "Nine out of ten major retailers do not have any expiration dates or any fees attached to their gift cards, so we don't think there's a problem."
"We really urge the shopper to look at what kind of card it is. If it's issued by a bank, there's a very good chance there's an expiration date or a fee attached. If it's issued by a retailer, there's a very low chance that there are those types of restrictions," said Howes.
State lawmakers return to the Capitol for their 2008 session on January 9.
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