Archive for the ‘Tips’ Category

I’ve seen so many examples of this working I’m shocked they don’t teach it in school.  Big companies rarely ever want the kind of negative publicity they get when a disgruntled customer contacts the media.

Dear Fixer: I bought a $60 gift card at a Target store in San Diego for a friend who let me stay with them while I was out there.

When my friend went to use the card three days later, there was no balance on it. I called Target’s corporate number and they gave me transaction numbers showing the card was used.

I called the store and explained what happened, and they said they would look into it. The store manager called me back and said someone used a picture of the gift card on his cellphone when he made the fraudulent purchase. The person cashing him out manually entered the gift-card number from the image on the guy’s cellphone, which they’re never supposed to do.

The manager clearly admitted it was fraud! But the store said corporate was the only one that could help me out.

The people at the store have been really great through this. However, I still am left with a gift card with no money on it. I kept trying to call corporate to explain the store admitted the purchase was rung up in a way not according to Target’s policy.

Why am I told there is nothing they can do? With all this evidence, it should be a no-brainer. You guys are my last hope!

Joe Rolla, Tinley Park


Dear Joe: Plenty of shoppers use coupons on their phones and lots of consumers redeem gift cards online, but having a cashier type in a gift-card number from an image on a phone seems out of the ordinary.

We’re guessing the thief took gift cards, scratched off redemption codes, photographed them and placed them back in the display, but that’s just a theory.

Weirder still was Target’s initial reaction when Team Fixer brought this to their attention. First, spokeswoman Meghan Mike said the company is “committed to protecting guests against fraudulent purchases” but suggested that you contact the San Diego Police for help. Later, they apparently had a change of heart and decided to correct this. Target has notified you that they’ll give you a replacement gift card.

I’ve heard of worse things to do with unwanted gift cards (like letting them sit around and expire).

In conjunction with Plastic Jungle, United Airlines is accepting gift cards with at least $25 in value in exchange for miles.

So what will a gift card get you?  According to this story (but ignore their incorrect math), a $25 Target gift card is worth 670 miles or 3.9 cents per mile.

Compare that to what it costs to buy miles directly from United:  3.5 cents per mile.

Converting a gift card to miles loses you about 6% of the face value of the gift card, similar or better than what you can expect if you were to sell your gift card to one of the secondary marketplaces directly.

Here is one aspect of this that doesn’t quite make sense; From the United website:

From Plastic Jungle’s website:

United/Plastic Jungle don’t require gift cards to be mailed in, but if you were to sell your Target gift card directly to Plastic Jungle, you would have to mail it in.  Go figure.

The old adage “if it sounds too good to be true, it is” clearly applies in this example of SPAM text messages claiming gift cards at a highly discounted rate.

There are several red-flags that show this type of advertisement is likely a scam:

  1. Unsolicited telemarketing via automated messages is illegal.  This includes unsolicited telemarketing text messages.  Anyone that sends you such a text is flouting the law and is unlikely to be offering anything legitimate.
  2. Companies just don’t give away something for nothing.  The best discount you can hope for on a gift card is from one of the many secondary marketplaces that exist.  You are unlikely to get better than a 20% discount on a gift card an popular gift cards (like Walmart) are in high demand and sell for a much smaller discount.
  3. The text messages claim the gift cards are free but upon further investigation, there is a small fee.

Reader Phyllis asks:

My brother gave me a mastercard debit card for 50.00. His wife paid the 4.95 activation fee upfront. However, when i went to use it at a restaurant, they said only 40.00 could be gotten through. I have tried numerous times to redeem the remaining 10.00 to no avail. What can be done about this fraud.

I’ve read a number of times that restaurant POS systems tend to add an additional 20% or more when running credit card authorizations to account for an additional charge in the form of a tip.  This may be something that is automatic and beyond the control of the person running the card.  In your case it seems that the system added an additional 25% for the authorization and would only allow $40 of charge as the additional $10 was included in the authorization.

With a normal credit card you might never know, because when the transaction settles a few days later and the original authorization expires or is removed, you only see the charge for the exact amount you actually paid (including the tip).

This is a problem that has plagued open-loop (which includes MasterCard, Visa, American Express, and Discover) gift cards from the very start.  In addition to restaurants, gas stations tend to authorize specific amounts (often $50 or $75) which causes problems with gift cards as it makes it impossible to put $10 of gas in your car using a card with $10 left on it.

While your missing $10 might be locked up for up to two weeks before the original authorization expires (and this is not a fault of the merchant, it is most likely the card issuer that wants make sure you don’t charge more than you should – but they go too far) you will eventually be able to spend that $10 if you can find a business that will let you charge that much as a separate transaction if your purchase something for more.  This is called a split tender when you use two different payment methods to pay one total charge (like a $10 gift card + cash).  Most if not all closed-loop (i.e. store-specific) gift cards will allow this, but surprisingly few merchants are familiar with how to do this (or willing to) with an open-loop gift cards, despite gift card issuers claims to the contrary.

In 2008 we started a service that allowed people to get the last few buck off their open-loop gift cards, but the powers that be were not happy with it and we had to shut it down.  There are no similar services that we are aware of, so you have to find a merchant that will allow you to do a split tender, or purchase something for exactly $10 to get the full amount off.

We welcome any publicity that helps people find the plethora of helpful information on gift cards our site provides for consumers, even if it is incorrect.

The Today Show mentioned us this morning as a gift card comparison shopping site, which we are not, but our resources page will help you find all the gift card secondary marketplaces and our blog has lots of useful information for the gift card consumer.

In addition to GiftCardGranny (a great site which the Today Show also mentioned) the other comparison shopping sites for gift cards we are aware of are CardNap and CardAvenue (which also has a helpful gift card registry).   Both CardNap and GiftCardGranny allow you to compare the resale price of your gift card among several of the secondary marketplaces (like CardPool, PlasticJungle, and ABC Gift Cards), and all three sites list prices for gift cards you can buy at a discount.

We recently took a fresh look at CardAvenue which changed its business model from a strict secondary marketplace to a gift card registry and secondary marketplace listing aggregator, which lists gift cards for sale at a discount from many of the secondary marketplaces.

As one of the reasons we started this site was to help consumers get the most value out of gift cards, it is worth considering the idea of a gift card registry in the grand scheme of all things gift card.

I think it is a great idea.  Events like weddings in particular are rarely an opportunity to give a personalized gift and gift cards are very common wedding gifts, but a registry would be helpful for other events, like birthdays, graduations, and baby showers; having a registry would help insure that recipients got gift cards they could actually use.  Getting gift cards you can (and intend to) use makes them more like cash and less like money that will eventually be lost.

CardAvenue bills itself as the first and only gift card registry, but strictly speaking this isn’t quite the case.  Gift card secondary marketplace Card Hub offers a similar service and alternately call it a registry and a wish list.  Some other gift card sellers also offer a registry, but only for their own cards, making them less useful.

What is to stop other sites from copying this great idea?  Technically, it isn’t a difficult feature, but as an aggregator of secondary marketplace listings rather than a direct secondary marketplace, CardAvenue has an advantage over a registry offered as an additional feature by a secondary marketplace; namely, they can offer a much wider selection of listings than the secondary marketplaces can directly.  There aren’t too many listing aggregators at the moment (CardNap and GiftCardGranny being the other two we are aware of).

Their service would be more helpful if you could purchase cards directly through CardAvenue (without having to go to PlasticJungle or another site), which would make it easier to have the gift cards sent to (correct) recipients address, much like when you purchase a gift from a registry at Macy’s, the shipping address is already filled in.  This would require a high level of cooperation from the secondary marketplaces, so I don’t expect it anytime soon.

That retailers are realizing they have nothing to lose and everything to gain by making gift cards easier for consumers to use is what I’m taking from this piece on Cardpool’s new service (now in limited release to existing Cardpool customers) that allows you to buy gift cards, and have them immediately delivered to your iOS or Android device.

Because closed-loop gift cards are part of, well, closed gift card networks, I would guess this could only be done in collaboration with the gift card issuing company, such that Cardpool is able to issue new gift cards.

This would have to be my favorite way to use your a gift card, buy it and then immediately use it up at the checkout counter of the store you are in.

Square, the mobile payments system that uses a small (yes, square) attachment for an iPhone, iPad, or Android phone to swipe credit cards for payment, appears to be an ideal device and system for draining your open-loop cards.  There is no monthly or annual fee, and swipes cost a flat 2.75%.  Account signup and approval seems to be pretty streamlined and at the end of the day, the money is transferred to your bank account.

It seems to be the perfect way to get the last few $$$ from your open-loop gift card.  Or better yet, drain them when you get them so they won’t drain themselves with fees once you forget about them.

Better yet, get Square and become the open-loop hero by helping all your friends drain their gift cards.

One of the keys to using up your gift cards is remembering to use them.  Some people keep them in their wallets so they have them whenever they are at the store the gift cards are drawn upon, but this method has largely been a failure for me as I can just as easily forget they are in my wallet as in a drawer.

My wife came up with a much smarter system; she puts them in a simple photograph stand (like this one) and places it somewhere that she’ll notice when leaving the house.

I’ve commented several times over the last year or more that what would be REALLY useful is a site that searches all the gift card secondary marketplaces for the best deal.

And finally today we have Cardnap, which does exactly that.  As the blog Lifehacker reports:

Cardnap’s primary function is to report on the best discounts, and the best selling prices, at gift card swapping spots like Plastic Jungle, Cardpool, and others. Type in a store name, browse through the discounted offerings, or hit the Sell section to see how much you can get for your remaining Cheesecake Factory balance. Free to use, the site claims no affiliation with any of the sites it scans, and there’s a handy balance checker you can use for any card.

Contacting the consumer advocate at your local newspaper or TV station can be a great way to get a company that is shirking its legal, moral, or ethical obligations to pay attention and do the right thing.  So I pay attention to those consumer advocates with great interest to see what publicly shamed company is doing an about face this week.

And this week it appears that gift card issues have gained the ire of the San Jose Mercury News’ Action Line advocate Dennis Rockstroh and he reports being contacted by hundreds of people reporting that many retailers still refuse to give them cash for gift card balances under ten dollars, more than two years after the law compelling retailers to refund such balances too affect.

The reason this continues to happen is that most people don’t put up a fight, thinking it isn’t enough money to be worth it.  But it is, because it keeps happening over and over to tens or hundreds of thousands of people, adding up to millions of dollars.

If this happens to you, I urge you to report the retailer to the California Department of Consumer Affairs, the Better Business Bureau, your local consumer advocate, and anyone else you can think of.

I’m not the kind of person who throws all my change in a jar and then looks to cash it in every five years, but if you are, you’ve undoubtedly come across one of the 17,000 Coinstar automated coin counting machines where you can simply dump your coins in and get cash, at a cost – Coinstar takes a 9.8% commission of the total.

But they have been offering some deals where you can get a gift card instead of cash and certain retailers have signed up to sponsor the waiving of the Coinstar commission if you get a gift card instead of cash.

They also periodically offer discounted gift cards.  For instance, Apple has done several promotions where you can buy a $50 iTunes gift card for $40.

Not a bad way to save a bit of money.

Here is a great tip from Lifehacker on draining the last few dollars from your open-loop (Visa/Mastercard/Amex/Discover) gift card buy buying gift bucks.

The problem with Visa/AMEX gift cards is that it’s difficult to spend every cent. It usually takes several transactions to whittle away the majority of the gift card’s value. Once the remaining balance gets low enough, you forget to use it or have trouble finding suitable transactions that are cheap enough. Adding to the frustration, most retailers won’t accept two forms of payment for a single bill so these cards just collect dust in your wallet.

The best way to get your money’s worth (literally) is to convert your Visa/AMEX gift cards into dollars. Since they are just credit cards with a spending limit, you can use them to purchase Amazon gift cards. Amazon makes this very easy to do because you can purchase a gift card in any incremental value up to $5,000. In order to redeem the entire value you will need to purchase TWO Amazon gift cards. The first gift card should be the Visa/AMEX gift card value minus $1. Then purchase a second gift card for the remaining $1 balance. Amazon uses a $1 authorization to confirm the credit card, or gift card in this case, is legitimate. If you try to use the full value initially, it will get declined. If you have a $50 AMEX gift card, buy a $49 Amazon gift card followed by a $1 gift card. If you have a $14.56 AMEX gift card, buy a $13.56 Amazon gift card followed by a $1 gift card. It’s that simple.

Insight into gift and prepaid cards comes from many places, and today’s information courtesy of a Wall Street Journal article on the prepaid debit card industry:

Yet customer and processing fees generate only about $11 a month in revenue per active card for NetSpend, estimates analyst Gil Luria of Wedbush Securities. And the average NetSpend customer uses their card for only 11 months before canceling. After servicing and distribution costs, including expenses for signing up new customers, NetSpend’s operating margin is 15%.

That average of $11 a month is a pretty hefty fee and far more than one would guess when buying one of these non-gift prepaid cards.  It is important to note that prepaid non-gift debit cards are not subject to the new gift card rules that came with the Credit Card Reform Act of 2009, and thus can charge greater fees earlier then their gift card bretheren.

It is also interesting to note, that at 15% operating margins, despite the hefty fees, the companies are not getting rich off of these cards.

With mail-in rebates, the odds are against you from the start.  My own experience is that I only get an actual response to a mail-in rebate about half the time, even if I have done everything right.  Then rebates started to appear as Visa/MasterCard cards, with none of the protections of most state laws or the new federal gift card laws.

It seems like they are becoming an even worse deal as rebate companies seem to be experimenting with shorter expiration dates.  Take this recent experience by a journalist:

Imagine my anger and humiliation when I pulled the card out in August, only to note two key dates: “Valid From 03/10” and “Good Thru 07/10.”

When he contacted the company that manages the rebate card program, he discovered:

A fact sheet on the site promoting rebate cards says this: “Checks expire within 3 or 4 months. While there are some exceptions, most rebate cards do not expire for at least 12 months.”

Clearly because of his experience, some rebate cards, and ALL rebate checks expire in substantially less than 12 months.  I think most people simply don’t pay attention to expiration dates and these companies must realize that shortening expiration dates is a good way to reduce redemption; it is better to deal with a few angry customers to save quite a bit of money.

We’ve previously posted some tips on getting the most value out of rebate cards, like:

  • Trick number one:  Take the card into your bank and attempt to have it turned into cash.  Apparently this is allowed on some cards.
  • Trick number two:  Use the card to buy another open-loop gift card, one that DOES have the gift card safeguards.

This particular customer decided to force the issue with the rebate company and demand a new card for his remaining balance:

I employed a strategy espoused by Richard Birke, director of Willamette University’s Center for Dispute Resolution. Everything is negotiable, he says. Plus, it never hurts to ask.

When I called the rebate card’s 800 number, I asked the rep to speak to a supervisor. None was there, she said, but she’d forward my request to one for review. Check back in 10 days on the status, she said.

Three calls and two weeks later, a rep named John told me my $85.80 had been reloaded on another card. I’d receive it in four weeks.

I’ve seen reports previously about telephone scams where thieves call people and tell them there is a problem with their bank account and they need to verify information.  People seem to trust that a phone call is legitimate and readily hand over personal information, including account numbers and passwords. The results of this of course are disastrous.

This scam seems to have migrated over to include gift cards as we’ve just seen a report of someone receiving a phone call claiming they won a Wal-Mart gift card and a credit card was necessary to complete the award.  They of course never received the gift card but instead were treated to a large charge on their credit card bill.

A simple rule holds true for avoiding scams, whether it is through email or by phone; don’t trust any information unless you initiated it.  If you receive an email asking you to click a link, don’t trust it.  The safest way is to go to the website directly by typing the URL into your browser.  If you receive a phone call asking you for information, unless you are familiar with the person, don’t trust them.  Find the number yourself, call the institution, and verify the information.

It is nice when someone takes a concept and creates a new way of understanding it, which is what has done with gift cards in their Mintlife blog.  We often buy gift cards because they are convenient and we aren’t aware of all the potential pitfalls, which have understandably gotten fewer over the last several years, but pitfalls do still exist.  Read this in full and see if you still want to buy a gift card for someone.

Read the rest of the story.

Technology often creates problems.  With the advent of gift cards and the electronic systems behind them, came the potential for problems and abuse.  We’ve seen plenty of examples of where technology has been used against retailers and consumers such as in the fraudulent cloning of gift cards and siphoning of their funds.  What you may not know is that there are also plenty of examples of when gift cards have stopped working properly, either through bad design or human error.

This story probably falls in that last category.

Last December, I paid cash to obtain $800 worth of American Express gift cards to give as Christmas presents. In March, my son tried to use his card. He was told that there was no money left.

He and I both placed calls to the customer service number on the back of the card. We were each told the money on the card had been sent to the Massachusetts Unclaimed Property division. The card said it was valid thru April 2014.

I contacted the Unclaimed Property, as suggested by American Express customer service. The first time, the Unclaimed Property division said nothing had shown up. I again tried to reach American Express, which said they could not add money back to the card without the receipt. I couldn’t get any answers about what happened.

This kind of thing happens all too often.  But what makes the difference between feeling taken advantage of and getting a problem successfully resolved is the persistence of the customer and the ultimate nature of the company involved.  I’ve seen lots of frustrating stories from people about American Express gift cards, but I’ve also seen some examples where the company has gone out of its way to right a wrong, when the customer was persistent enough to pursue a resolution when he was initially rebuffed.

You might find that the company that issued the gift card is quite reasonable and will fix the problem without too much fuss.  Or you might find that it takes some persistence to get your problem resolved.  What people don’t realize is that if no one complains about problems, companies have little reason to improve; it simply isn’t enough of a both.  I personally do my best to pursue any matter where I feel that I’ve been treated unfairly, even if it is for a few dollars and even if it is just writing a letter to a company to tell them why I will no longer be doing business with them.

Here are some tools you can use in increasing level of escalation:

  1. Call regular customer service
  2. Ask to speak to a customer service manager
  3. Search Google or Bing for executive level contact information for the company and write them letters
  4. File a Better Business Bureau complaint
  5. File a complaint with your state’s departement of consumer affairs
  6. Contact your local TV station or newspaper consumer advocate and ask them to contact the company on your behalf
  7. File a story at Consumerist so others will see your experience
  8. Share your experience on Twitter.  Many companies monitor Twitter and respond to complaints.
  9. For financial products, file a complaint with their state or federal regulator, such as the Federal Reserve.
  10. If you believe the company has behaved in a criminal manner, contact your state’s attorney general to file a complaint.  State Attorneys General will pursue investigations if enough people complain.

The point is, there are lots of ways you can pursue resolution beyond simply calling customer service.

Even better, search Google or Bing BEFORE you buy a particular gift card to see what other people are saying about the company.  Try searches like “company_name gift card sucks” or company_name gift card problems.”

Sometimes, none of these things work.  I had an open-loop gift card that showed no balance when it should have had $25 on it, as it had never been used and neither the website or customer service number provided a way to get in touch with a human.  None of the tools above worked.  But I felt good knowing I had tried to get resolution.

In the story above, here is what happened:

After presenting the situation to the folks at American Express, they dug in to figure out what happened — which apparently got a little confusing along the way — and then righted the wrong.

When you’re about to try to gird for a fight with a company, take the time to be sure of the facts and gather up all the documentation you can to help make your assertions as clear as possible.

First, in sorting things out, they found out that cards purchased in December were used. But the provided card number was indeed still valid and should have had money on it.

She said she couldn’t address what might have been said along the way in those customer service calls, but did explain the only reason there is an expiration date on the cards is so transactions can be processed.

“As funds on American Express Gift Cards never expire, we are sending her a replacement gift card with the remaining balance,’’ American Express spokeswoman Vanessa Capobianco said.

Ah yes, one more thing to remember, act reasonably and be nice to the people you talk to.  In the slim chance that you are wrong, that will help save-face considerably, and it might actually help you get resolution faster. offers discounted restaurant gift certificates.  A typical deal might be a $25 gift certificates for $10.  My wife and I have purchased discounted restaurant gift certificates from before and have not had problems.  But, according to a recent ABC News story, some people using these certificates are having problems, and it seems that many of them are related to misunderstandings, so it is important to understand how these work before you buy.

The first thing to be aware of is that gift certificates offered only in paper form are immune to the new Federal Reserve gift card rules, and thus can carry expiration dates and fees where gift cards are strictly limited. says that the restaurant gift certificates they issue do not have expiration dates, so this shouldn’t be a problem with but is just something to be aware of in general.

The gift certificates do have some restaurant specific limitations:

  • Restaurants may not accept gift certificates on weekends or may accept them for certain meals only (i.e. dinner only).
  • In some cases the gift certificates can’t be applied to alcohol purchases, tax, or tips.
  • Most restaurants have minimum purchase rules, meaning that you must often purchase a minimum amount when using the gift certificate. says that the average minimum amount is $35 but some do have a higher minimum amount.

None of these are show stoppers in my opinion but if you aren’t aware of them, you might be disappointed.

Specific terms for any individual restaurant are available both before and after you buy, so be sure and look for them.  One place you can find them is “specific restrictions” link, where you have to agree to the terms and conditions, during the checkout process.  The specific restrictions are also listed when you print out the gift certificate and on the certificate itself.

The ABC News article claims that if a restaurant goes out of business you are left holding a worthless piece of paper, but according to a spokesperson, they will replace your gift certificate with one from another restaurant of your choice if this happens. also clarified that in the particular case highlighted by the ABC News article, the restaurant changed the terms (refused to accept gift certificates on Friday nights) without informing them and that the customer did not try and follow up with  If they had, would have provided them with a replacement gift certificate for another restaurant.

These gift certificates can be a great deal, just be sure to be aware of any restrictions so your expectations are realistic.