What to do when a new gift card shows zero balance
Fraud, human error can cause cards to say they're empty
Covers fraud, families, and erasing debt.
You're at the register of your favorite store with an armful of clothes or a couple of lattes, but when the cashier swipes your gift from Aunt Jean, the card shows zero balance. You've been gift card Grinched. Don't give up. There are steps you can take to get your money back.
First, make sure the cashier rang up the gift card correctly.
"It's possible he or she didn't enter it as a gift card, but incorrectly hit 'debit' or 'credit,'" says Shelley Hunter, content manager, spokeswoman and "gift card girlfriend" for GiftCards.com. A manager or customer service representative can double-check to make sure your gift card was entered as a gift card, Hunter says.
Still empty? Before you panic, think: Did you use the gift card and forget?
"Sometimes when you use a gift card, the cashier will give it back with a receipt that says 'zero balance,'" Hunter says. "If you put the card back in your wallet without the receipt, there's a chance you will pull the card out again and try to use it. I've done that and realized, 'Oh, yeah. I did go to a movie.'"
There are more disturbing reasons your gift card may be empty. Scammers have all kinds of ways of stealing your gift card's value.
Before you go shopping, make sure the silver scratch-off strip on the back of the card has not been tampered with, advises Carole Reynolds, a senior attorney with the Federal Trade Commission.
If the strip has been scratched to reveal the card's security code, someone could have gotten the gift card number and code, waited for the card to be loaded and then used the card before you got the chance, Reynolds says.
Whether or not the strip has been tampered with, you'll need to start making phone calls.
If you're comfortable calling the person who gave you the card, ask for the authorization code he or she was given when the gift card was purchased and activated, Hunter says.
It's an awkward conversation, especially if you don't know the giver well, she acknowledges. But it's not as if the amount spent on the gift card is a secret, she says. "It's not like you bought a sweater, and they don't know how much it cost," Hunter says.
Another call you should make is to the number on the back of the gift card, Hunter and Reynolds say. You can check the balance on the card and ask about any transactions made on the card, including when they were made, where and for how much, Hunter says.
For example, if the card was used in New Mexico and you live in California, you have a good case to show you didn't make those transactions, Hunter says. "Say, 'I have my card and this is where I live,'" she says. "I don't live there. Someone has stolen that code."
Dates may also provide evidence of fraud. For example, the purchaser may have bought the card online on December 27 and mailed it that same day, but all the value was depleted on December 28 while the card was still on its way to you, Hunter says.
After you've shown proof that you likely couldn't have used the card, "The business may be willing to replace the funds," Reynolds says.
Store fraud or error
Another possible problem that the gift card issuer will want to investigate: Even though your friend or family member paid for the card, the cashier never loaded it -- because of either an error or intentional fraud, Hunter says.
"Was the gift card ever activated?" Hunter says. "We're introducing the issue that there could have been something wrong with the system. Fraud may have taken place."
Again, you'll have to pick up the phone. Your gift giver may have a credit card receipt that shows the store, date and time, and cash register where the gift card was purchased, she says.
The store should be able to look up that transaction, Hunter says. An investigation might find, for example, that there were 50 or 100 incidents at one store over the holidays, Reynolds notes.
"Whether the answer is, 'I got scammed,' or, 'Your system doesn't work,' the store should be interested in solving that problem to make sure it doesn't happen to someone else," Reynolds says.
Help beyond the retailer
Still no luck getting your money back? If the person who gave you the gift card bought it with a credit card, they may be able to get their money back from the credit card issuer.
"See if the credit card offers some sort of fraud protection and tell the card issuer, 'I believe I got scammed. Can you help me in any way?'" says Hunter.
If these options don't work, don't give up. Even though federal law does not protect gift cards that don't work, you can still pursue your grievance by filing a complaint with the Consumer Financial Protection Bureau. The bureau will contact the company to get its response and track how the matter is settled.
You also can file a complaint with the FTC through its website or by calling 877-FTC-HELP. The FTC doesn't represent individuals directly, but complaints help law enforcement detect patterns of abuse or fraud.
See related: 9 tips for using mobile gift cards safely, Don't be 'breakage' -- 7 tips to avoid losing gift card value, 5 reasons there's a hold on your gift card , Buying gift cards with credit cards gets easier
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