InComm, an Atlanta-based prepaid product and transaction services company, will remove its gift card mall program, which includes such gift cards as iTunes, Macy’s, Chili’s, Maggiano’s, Subway Card, and Lord & Taylor, from more than 2,500 retail locations in New Jersey by June 30. Affected retail locations include grocery, convenience, big-box, pharmacy and discount, chains. InComm is also pulling its Vanilla Visa Gift Card and Vanilla MasterCard Gift Card products from the state.
The company’s actions are a result of 2010 modifications to New Jersey’s unclaimed-property law, which aimed to fill a budget shortfall. The revised legislation requires retailers selling gift cards to gather a gift card purchaser’s personal information, including name, address and/or ZIP code, at the point of sale. This information will then be retained by card issuers and is reportable to the state. After two years of gift card inactivity, New Jersey will automatically take the unspent money, even if the card hasn’t expired.
“Because InComm is unable on behalf of its third-party gift card partners to ensure compliance with this law, we unfortunately have no choice but to remove all our gift cards and gift card destinations from retail locations in the state of New Jersey,” explained InComm president and CEO Brooks Smith. “As always, we are committed to providing the best possible products and services to our retail and brand partners and ease of use of these products for consumers, and we regret that this new law keeps us from doing business in New Jersey.”
Continued Smith: “In addition to the compliance issues this law creates, we are very concerned that our New Jersey consumers will not have continued access to their gift card funds. States should not have the right to remove funds from an unexpired gift card.”
InComm cited a recent third-party survey of about 700 New Jersey residents that found 89.7 percent didn’t want the new law to go into effect, 94.3 percent didn’t want to lose the ability to buy gift cards in the state, and 90.9 percent didn’t want to provide personal information when buying gift cards.
The company further noted that according to federal law, gift cards can’t expire earlier than five years after purchase, and that most gift card funds never expire.