×
Newsmax TV & Webwww.newsmax.comFREE - In Google Play
VIEW
×
Newsmax TV & Webwww.newsmax.comFREE - On the App Store
VIEW
Skip to main content
Tags: US | Fed | Gift | Cards

Fed Cracks Down On Gift Card Abuses

Tuesday, 23 March 2010 11:08 PM EDT

The Federal Reserve issued new rules on Tuesday to protect Americans from getting stung by unexpected fees or restrictions on gift cards.

Gift cards have grown in popularity — with more than 95 percent of Americans having received or purchased them, the Fed said.

And as usage has gone up, so too have complaints from people taken by surprise by fees that eat into the value of the cards as well restrictions on how long they'll be good for.

Under the rules, consumers must have at least five years to use the gift cards before they expire. The Fed also says service or inactivity fees can be imposed only under certain conditions.

Such fees can be charged if the consumer hasn't used the card for at least a year, if the consumer is given clear disclosures about them and no more than one fee is charged a month.

The rules take effect Aug. 22.

Congress ordered the Fed to issue the new protections under a law enacted last year.

Sen. Charles Schumer, D-N.Y., who championed the gift card crackdown in Congress, wants faster implementation of the rules.

"Now that the new rules are finalized, we will work with the Fed to speed up the effective date rather than keep consumers at risk of being ripped off until next summer," Schumer said. "These new rules will curb the abusive fees and early expiration dates that can drain gift cards of their value before they are ever even used."

The Fed received more than 230 letters weighing in on its proposal first unveiled in November.

Many individual consumers urged the Fed to ban all fees and to eliminate expiration dates so that people didn't lose any value on the cards.

© Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


US
The Federal Reserve issued new rules on Tuesday to protect Americans from getting stung by unexpected fees or restrictions on gift cards.Gift cards have grown in popularity with more than 95 percent of Americans having received or purchased them, the Fed said.And as usage...
US,Fed,Gift,Cards
287
2010-08-23
Tuesday, 23 March 2010 11:08 PM
Newsmax Media, Inc.

Sign up for Newsmax’s Daily Newsletter

Receive breaking news and original analysis - sent right to your inbox.

(Optional for Local News)
Privacy: We never share your email address.
Join the Newsmax Community
Read and Post Comments
Please review Community Guidelines before posting a comment.
 
TOP

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
America's News Page
© Newsmax Media, Inc.
All Rights Reserved
Download the NewsmaxTV App
NEWSMAX.COM
America's News Page
© Newsmax Media, Inc.
All Rights Reserved