Article

60. Fear about gift-card balances

February 17, 2010

With all the anxiety surrounding the uncertain economy, here's something else to worry about: What happens to the money on a gift card if a store claims bankruptcy or goes out of business? It's a mixed bag. Some stores continue to honor gift-card balances, as Circuit City did, after filing for bankruptcy. But the cards have few protections; a retailer must ask the bankruptcy court to allow it to continue honoring the cards. If that doesn't happen, the card-holder must take her place in line — behind the creditors.

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