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SmartCredit.com Consumer Education President John Ulzheimer on a New Jersey law’s impact on gift cards.
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Companies -- American Express in pulling its gift cards from all New Jersey stores now both companies said they'd rather pull their cards altogether than comply.
The State's unclaimed property law -- -- state next -- away in John.
The consumer education for Smart credit dot com John great to see you tell us what's going on here how can state reclaim -- Menaces lawmakers gone crazy.
To what essentially what they've done is they've written -- -- actually written a couple of years ago.
And it was temporarily blocked by judge who is now studies in what the law -- -- but basically what happens is you have a gift card that you purchased it and New Jersey retail are.
After two years of Dorman C meeting that the court has not been used for 24 months.
Then the state can meant in pounds the value of the -- and then hold onto it as if it is unclaimed property until Sunday in the future.
-- the consumer decides to go to the state of New Jersey and say hey I know you have a find needs to value from what -- charts that I got X number of years ago are well back.
You know and you don't think this is a problem there's some 41 billion dollars worth of -- redeemed gift cards.
Anyone really think the take away hear it as routine -- gift cards.
And then if somebody usually gift card use the money user right away expanded out to China -- Don't wait -- -- -- -- don't wait till Saturday unloaded because there fees associated with these things at the end of the today.
People just need to spend the -- -- This this is selling its absolutely silly Eddie ever want to raise your hand you know how to go through process of claiming unclaimed property now we're just raise their hands.
If there's if there's a federal law on the books that forty protects consumers.
Relative to these types of gift card -- area called the card act.
And a card act -- is.
It the value of your gift card past rating intact for five full year -- -- when she go dormant.
For more than twelve months and even if you go dormant for twelve consecutive months.
Only a small he can be charged by the issuing bank comfort hard.
This they got this totally backwards do you -- what happened last year with cash for clunkers.
There's a -- on new cars people trading in -- jumpers to get your -- Then this could have been crafted to insanity exact same activity.
Don't give them two years or five years you turn around -- you say you have three months to -- get -- for the bank can start taking -- -- out against state.
And you'll have this perpetual machine of consumers running to the mall to spend her gift cards as soon as possible.
Not -- who -- -- 24 months before they use the gift card.
They've walked stick it has lost they -- -- -- forget about it no never about the process of going in claiming to have late.
You know this is sticky fingers by state governments you know they're short on cash they're looking for anything they can now get their hands on.
But what you're saying that I think is so interesting is that what they're doing is at odds with federal law -- it.
How's -- gonna resolve itself what can happen next.
Wow did in the scary thing about this is -- hears argument argument is whose money is that.
Is it the consumers.
Isn't issuing banks.
-- arguing Pasadena 21 of those two parties it's likely that consumers where world as the -- covered from her those kind of writing -- at the last minute segment on how it actually our mighty.
After 24 months they are never involved in the transaction to Begin -- and this is an.
This an issue for people who -- in New Jersey.
This type of stop -- of candidacy to snowball.
So if you're gonna buy gift cards and they double -- in New Jersey first off.
Second if this could become a problem in the state -- you let himself be way error merchants and do you -- issuing credit card are issuing gag gift card companies.
Craziness well and interesting -- -- add.
I doing this he's a favorite a lot of people's but but I'm sure we'll debate this some more Jon thanks for coming on tonight we appreciate your time.
You --
