It is estimated that consumers will lose about $100 million this year on gift cards due to bankruptcies. If you are still holding on to gift cards from last Christmas or birthday, now is the time to use them or risk losing them.
Below is an updated list of recent major retailer bankruptcies and their impact on gift card holders:
Tweeter – Tweeter, the electronics store chain filed for bankruptcy on Nov. 5, 2008. The company was granted permission by the U.S. Bankruptcy Court on November 10th to continue the redemption of gift cards through Saturday, Nov. 15 (yes, only 5 days to redeem gift cards). If you were unable to redeem your gift card by that date, the only option left is to file a claim with the Bankruptcy Court for the unused portion of your gift card. However, you could be waiting a long time for this and chances are, you may get pennies on the dollar, if at all.
Circuit City – Circuit City filed for bankruptcy reorganization, meaning that they plan to restructure the business and come out of bankruptcy a more efficient company. They are still accepting gift cards during the bankruptcy and are still issuing new gift cards. If you haven’t done so already, use your Circuit City gift card soon. I will also advise against buying a new Circuit City gift card at this time.
Linens ‘n Things – Linens and Things initially filed for bankruptcy reorganization in May 2008 but things did not work out as planned so the company decided on October 15th to shut its doors. They are still accepting gift cards during the liquidation so this is your last opportunity to use your Linens and Things gift card or say goodbye to it forever.
The Sharper Image, Bennigan’s and Steak & Ale Restaurants, Value City Department Store, Mervyn’s Department Store, Steve & Barry’s, Boscov’s Department Store have all declared bankruptcy this year. For more on these companies, check out the Bankruptcy & Gift Cards page.