The Gift That Stops Giving

摘要

Still haven't used up your gift card from the holidays ? If the retail chain files for bankruptcy, it might be too late to spend the money. While gift cards issued by credit-card companies, banks, or other financial firms are usually protected under federal laws, those sold by retailers come with no such guarantee. When a store goes bust-an increasingly likely event in the current economic environment-its creditors can go after that pot of gift-card cash. Linens'n Things, which filed for bankruptcy on May 2, had to petition the court to continue operating its gift card and other customer loyalty programs. The judge agreed, preserving $42 million outstanding on consumers' gift cards. "We are pleased that our current restructuring will not interrupt our program," said F. David Coder, president and chief operating officer of the Clifton (N.J.) home goods chain, in a statement. Customers of Sharper Image weren't as lucky. After the specialty store filed for bankruptcy in February, the company imposed new restrictions on its gift cards. Shoppers must spend their balance during one visit. And the total purchase must amount to at least double the dollar value on the card. The company did not return calls for comment.