DC Sues AT&T For Unclaimed Phone Minutes 145
Suki I submits news that Washington, D.C.'s attorney general has filed suit (District of Columbia vs. AT&T Corp, Superior Court of the District of Columbia), claiming the city has the right, through laws applying to unclaimed property, to unused calling-card balances held in the name of D.C. residents. "The suit claims that AT&T should turn over unused balances on the calling cards of consumers whose last known address was in Washington, D.C. and have not used the calling card for three years. 'AT&T's prepaid calling cards must be treated as unclaimed property under district law,' the attorney general's office said in a statement. ... [That sum] represents some 5 to 20 percent of the total balances purchased by consumers who use the calling cards. States and municipalities have often similarly used unclaimed property laws, known as escheat laws, to claim ownership of unused retail gift card balances."
Suki I links also to Reason Magazine's coverage.
All your value belong to us? Nope. (Score:5, Interesting)
This is law in many places... leave a balance in a bank account and fail to respond to any correspondence or make any transactions, and that money is transferred to the government who will publish your name in a massive newspaper insert, and then give it back to you if you claim it by proving the social security number the account was under is yours, and if that times out it goes to the government to do whatever they want with it.
Gift cards in many places have taken up the retailers on "if this fee is not allowed by law" to kill off inactivity fees. You now have many years or until the store shuts its doors for good (even during a post-bankruptcy liquidation that operates under the store's name) to use that money.
So, why does AT&T and the other phone companies think they can get away with voiding cards they don't hear from for three years and keeping the money? It's an unclaimed balance, and businesses aren't allowed to profit from such things in many other cases... what's the difference?
AT&T Not Voiding the Cards? (Score:5, Interesting)
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Don't most phone cards say the minutes actually DON'T have a cash value?
Re:AT&T Not Voiding the Cards? (Score:5, Informative)
Don't most phone cards say the minutes actually DON'T have a cash value?
Can't most governments ignore such small print unless it is somehow enshrined in law (so the lawyer fight induced by trying to ignore said small print would be more costly than the potential gain). Many software EULAs state things that are quite patently not legally enforceable in most jurisdictions - I'm guessing the small print on phone cards and similar have no more basis in law than an EULA.
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Yeah, you have a point. Very nicely done.
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Except the line about no cash value is also on the packaging, IIRC. Which means that unlike a EULA, the contract is defined before you buy the product.
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But that still does not explicitly mean that the contract (well, that part there-of) is legally enforceable in all jurisdictions.
It is not uncommon for employment contracts, which are supposed to be read in detail before signing, to have clauses that are not actually enforceable and therefore effectively void. Overzealous non-compete or IP related clauses are the most regular examples of this. A clause being in a contract does not necessarily mean that is it legally enforceable, or legal at all, and even if
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Except, I paid sales tax to purchase the card, I didn't deposit money into the account. Therefore, the card is the product/service, not the call.
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but I paid for access to MINUTES of phone time in an account, and the contract to use the minutes expires in a limited amount of time. That's an entirely valid contract. Those unused minutes do not convert back to "property" anymore than I get a refund on my parking meter if I only use half the time parking my car. (take that District... and a car analogy to boot!)
The District is after the monetary value... which will conveniently amount to below the limit for reporting "unclaimed property" the exact same t
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They have intrinsic cash value for the balance on the card. It would have no value outside of the company who issued it as it wouldn't be legal tender at, say, the local sandwich shop. "No Cash Value" is typically something you see on things like poker chips, and game tokens and such. Return them to the company who issued them and they will honor it's value. That phrase simply means you won't get any value for it outside of the issuing company.
Non-refundable (Score:2)
Return them to the company who issued them and they will honor it's value.
Unless "no cash value" is next to "non-refundable".
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They aren't asking for a 'refund'. They are asking that the remaining balance be transferred to another holder.
This type of thing is done all the time by states using unclaimed property laws.
Poke-non: gotta disclaim 'em all (Score:2)
They are asking that the remaining balance be transferred to another holder.
No cash value, non-refundable, and non-transferable without the original card. Look at any stored value cards that may linger in your wallet; for everything you suggest, a lawyer has thought of a "non" to get around it.
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Your suggesting a company can simply ignore a law because they print something on a card? They could print anything they wanted and it still wouldn't dissolve the states right to unclaimed property.
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Re:Poke-non: gotta disclaim 'em all (Score:5, Insightful)
I think the general principle behind that would be
"This valuable item is not in use, it is not on private property, its rightful owner has for all intents and purposes forgotten that it existed anymore and will very likely not use it ever again. But all citizens have an interest in not letting value vanish, so it is appropriate that the disclaimed value is transferred to the State to use it. That way, all can benefit from lower taxes and higher revenues. No one is hurt, because the value was disclaimed long ago and would have otherwise benefitted someone who's not the rightful owner or no one at all when the value finally vanished."
AT&T or any other gift card issuer have the money and never had to deliver any goods. They are not the rightful owner of the money unless they found a way to hold up their part of the deal. Letting them keep the money for unredeemed gift cards would be an unjust benefit for them, even introducing an incentive to prefer "store money" instead of Fed Money. Because it is impractical to have all stores track down the gift card buyers, the State can reappropriate the funds and put them to use before the store goes bankrupt or moves out of state and the monies are finally lost.
I'm surprisingly okay with that, because I think it reduces the incentive of businesses to use anything other than the green Fed Money known the world over or to devise schemes that leave over untold uselessly fractioned monies. The State as a catch-all for fall-out from the daily business routines is not impractical. Use it, claim it or the State puts it to good use for you before it is lost.
The State better not even think about applying that principle to real estate or bank accounts held in real currency. These are property forms especially chosen to store value as they are unperishable. Reappropriating them is only acceptable when their owner died and absolutely no living heirs can be found for twenty years. But anything else than that will warrant an early Guy Fawkes day.
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What I don't get is why a usually libertarian sanctuary like /. doesn't seem to have a problem with the states grabbing unclaimed property? Hell both sides are already taxing and spending like there is no tomorrow, why should they have the right to grab someone's stuff because they haven't used it in x amount of time? What business is it of theirs?
We already have them practically turning us upside down and shaking in hopes of loose change falling out, lets not give them more ways to snatch, okay?
This is /. AT&T is a giant evil monopoly. So, just like Microsoft, /.ers don't care about reality, they just want to bash the monopoly in question.
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Let me stop you right there. You're already wrong in the second part of your basic premise. As far as the owner of a gift card or calling card is concerned, there's no account. They put money on a card, and thus as far as normal people are concerned, they perceive that the card has a certain dollar value. That card is in their possession on private property. Therefore these laws cannot legitimately be enforced against such monetary inst
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AT&T hasn't been a monopoly since before most Slashdotters were born.
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But all citizens have an interest in not letting value vanish, so it is appropriate that the disclaimed value is transferred to the State to use it.
Kind of like all that manufactured capital that was destroyed in 'Cash for Clunkers'. Oh wait...
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Actually they do clearly state their cash value. The card regardless of the number of minutes associated with it is worth $0.01 USD.
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I think there's a big flaw in the law .... (Score:2)
When I, as a consumer, purchase a pre-paid card with X number of usable minutes on it, I typically plan on using the whole thing, OR I'm not that concerned, because the ability to make some phone calls, as needed, is what I'm really paying for to begin with. If the fine print on the card informs me, before the purchase, that there's an expiration date on the card - then fine. I can opt to accept that, or decline the purchase if I think that's unacceptable.
I don't really have a problem with the phone compa
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Inactivity fees are IMO a valid way to make up for the costs of keeping the card's serial number active. Obviously they have to keep track of every single card that has value or you won't be able to use any of its value, and the maintenance of that data costs money.
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But this price would be a fraction of a cent per card for most cards. How much money does it cost to maintain a database with millions of numbers? A large percentage of this cost would be normal operating costs which is included in the price of the service/card.
This generally isn't about the price of upkeep for one number in millions, this is about trying to grab excess money to pad the bottom line. This might be good or bad, but lets be honest about it.
I used to be a customer at Chase Bank, I had a chec
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They do this on my unclaimed minutes each month...er is that not the same?
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I know all of us are pondering the same thing:
Does this apply to unused gamecards for WoW? Does government have the right to thousands of hours of unused WoW gametime?
Yes, if you were to purchase the gamecards and never cash them in Blizzard would not be allowed to just void them. The government would have the right to take them and hold them for you and if you did not collect them after a certain while the government could do whatever with them.
Re:All your value belong to us? Nope. (Score:5, Interesting)
I had one state (Virginia, I believe), track me down after 6 years for a balance left in a former employer's pay system. I was surprised at the tenacity of the government in a case like this. They didn't just grab the money an run, like some other commenters here seem to imply.
Re:All your value belong to us? Nope. (Score:5, Funny)
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Lawyers (Score:3, Interesting)
Wow. I gotta hand it to them. It is times like this when when we should all take note of how lawyers really are a breed apart. I understand the theory, and it does makes sense. Mind you, understanding and agreeing are not one in the same. But how twisted do you have to be to come up with stuff like this? I never would have thought of that!
As the said in the LotR about the lawyers foreclosing on the shire ( I think it was LotR, The Revenge ).
"There's something strange at work here. Some evil drives these creatures, sets its will against us."
Next target (Score:2)
Next week the AG will be suing "massage" parlors for unused "buy ten get a freebie" cards!
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Next week the AG will be suing "massage" parlors for unused "buy ten get a freebie" cards!
Rest assured, the AG gets freebies already. That's what it means to be in a position of power.
Level playing field (Score:2, Interesting)
This action sounds like they're trying to prevent at&t to get unfair advantage over selling stuffs they have no intention to provide service for. They probably bundled minutes with some product and most of their customers payed for the service, but never intended to use it. So at&t got unfair compensation for selling bogus service.
If practises like this are not removed, the market will be full of gift cards and calling cards, with most of the people's money going to something they're not going to us
Screw AT&T (Score:2)
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The company you think of as AT&T is really a re-branded SBC and has only been AT&T for 5 years.
The company you think of as a re-branded SBC are reassembled parts of the AT&T that the DOJ broke up in 1984. 4 of the 7 baby Bells and the AT&T long distance company. Bell Atlantic and NYNEX became part of Verizon, and USWest became part of Qwest.
Bell_System_divestiture [wikipedia.org]
Probably the only real obstacle to completely re-assembling the old AT&T would be Gov't objections to AT&T and Verizon c
They should never expire (Score:2, Offtopic)
I don't mean gift cards. I'll rant about them in a minute. But phone cards; we're talking about truly minimal data here, it's one row in a database. AT&T could issue phone cards for years before the amount of data they'd have to store would become an undue financial burden to their evil empire, death star asses.
Gift cards are lame: Why not just give the gift of cash if you care so little about someone that all you can do is send them to a store you think they would like? Gift cards: the gift that says "
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I prefer gift cards to certain places, because then no one can bitch about how I spent them. Get a gift card for, say, an electronics store? "Well, I HAD to use it, all they sell is electronics, so I bought a new $toy!"
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Why not just give the gift of cash
You can't mail cash.
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Sure you can. It's not really the best idea in the world as there's no recourse if it's lost or stolen, but there's no law against it.
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You've obviously never tried to cash one of my checks.
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I used to work in the phone card business. We had all sorts of calling card programs. There were promotional cards (buy three packs of diapers, get twenty minutes talk time), we had cards for telco providers to rebrand (like AT&T), we had the convenience store quickie cards that were use and toss, and so on.
Most of them were use and toss. The whole program was meant to have a certain life span, then we shut it down and finalized all the accounting on it.
We knew not all the minutes of all the cards wo
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"We knew not all the minutes of all the cards would be used. We would estimate how much wouldn't be, and factor that into the cost of the program. If by some fluke, it was all used up, we would have lost money. Instead, we'd usually be close and it would keep the cost of the minutes down as well as give us (the service provider) and the company selling the cards a useful profit."
Or they could run a simple and useful promotion designed not to screw the customer over. One that would benefit everyone. I know
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It would cost more. What part of that don't you understand? You think you're "getting screwed" less by paying a lot more for the card?
These programs can't run forever. The toll free numbers cost money, having customer support set up for it cost money, the carrier circuits cost money, the switch and servers cost money, the techs to run them cost money. That's why the programs have a definitive end date. That's why the cards are sold with a set expiration date.
No one is "getting screwed". The cards are
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Lame? Not always - gift cards are quite useful in many circumstances, so don't write them off so glibly. Before gift cards (yes, there was such a time) giving people "throughly liquid cash" as a gift meant they were just as likely to use it to pay the rent, buy groceries or stick it in their wallet with the other liquid cash and spend it for ordinary things, not the intended gift. In the face of this, gift cards were a nice way to help the recipient "treat themselves" as intended rather than just spend t
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giving people "throughly liquid cash" as a gift meant they were just as likely to use it to pay the rent, buy groceries or stick it in their wallet with the other liquid cash and spend it for ordinary things
You should trust them to be mature enough to manage their happiness and their need to be housed, especially in the current economic state.
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Plus there is the "Bounce Back" principle
Rather than try to guess sizes on that special gift you bop down to say Victorias Secret buy a gift card and then drop hints as to what to buy.
Big internet access bonus for the DC area (Score:5, Insightful)
So anything that's unclaimed like this defaults back to the city? I wonder what they're going to do with the remainder of everyone's unclaimed, unlimited internet access each month. Did they pool the unused hours off of old AOL CDs? What about all-you-can-eat buffets? Solved DC's hunger problems right there.
Re:Big internet access bonus for the DC area (Score:5, Insightful)
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Those parking meter minutes are reclaimed. It is a government that operates them and collects that revenue, is it not?
However, I greatly dislike parking meters. Same as red light cameras, the intent is not only for safety or reducing demand for scarce resources by charging for them and collecting that small change, it is also to generate violations, which thanks to the huge fines is much more lucrative. I almost never park in a metered spot. Too much risk of getting a parking ticket, too much underhan
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Dear Sir/Madam
We find your ideas intriguing and would like to subscribe to your newsletter.
Best regards:
The lawyers
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Unused processor cycles.
Citizen! Your screen saver is anti-social. It is being removed. Please install the new Obama screen saver. Enjoy!
Corp v. Govt? Bottom Line: You Lose (Score:2, Insightful)
There is another reason for governments to escheat funds that I haven't seen posted. It is a fact that governments make a tidy sum of money off of these transactions, as many escheated funds are never claimed. For some governments, it is a material source of revenues.
For that reason, governments are not aggressive in alerting taxpayers that they are holding their funds. Some US states have an on line mechanism for submitting a claim, and most government put a legal notice in a paper once a year, but the
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I'd bet the unused $5 per account doesn't meet the minimum amount to bother with posting.... hence the want for the big check of all the aggregate amounts!
This is just plain stupid (Score:2)
Can't believe that your country spends resources on such stupid things. Maybe they should think about worthwhile things, and put stuff like this lower on the list -- say below airport security.
In any event, here's why this is stupid.
First, they may be unused, but they aren't unclaimed. You purchased a service from AT&T, not property. AT&T still owns them.
Second, the whole unclaimed property when it comes to money in stale bank accounts is because money is also owned by your country. It has to be
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No law against burning money. I've never bothered, mind you, but I will if someone tries to make it illegal.
And yes, the mint CAN just print more money. It's called "inflation".
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"inflation" kind of kill the word "just". When the mint prints more money, your country's currency becomes less valuable.
That's why you can't burn money -- or destroy it. It's not yours.
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There. I just lit a dollar bill on fire. Seems you were wrong about me being able to burn money....
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I didn't say you weren't capable. I said it's illegal. Learn the difference between law and enforcement.
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Yes, there's laws against burning money.
http://codes.lp.findlaw.com/uscode/18/I/17/333 [findlaw.com]
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Your country spends way too much time litigating stupid shit instead of actually solving problems.
Hey, you have to go with whatever talents you have. We happen to be very good at litigating stupid shit, thank you. Actually solving problems, not so much....besides being a lot harder, it might actually reduce the amount of stupid shit available to litigate. Then where would we be? Who's going to pay to retrain all those out of work Stupid Shit Litigators? We might get desperate and have to import other countries' stupid shit to litigate. What would that do to our balance of trade?
Clearly, you just do not
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Well spoken.
I think this is different than gift cards (Score:2)
It will depend on the state when it comes to gift cards. But, unusued phone minutes?
Won't it devalue the profit the phone company is making off of them? Think about it. The phone company sells these minutes knowing a certain percentage will probably expire. And I assume it's not 100% profit for the phone company when they sell these minutes. So, won't they adjust the price knowing 100% of all the minutes sold will end up used?
Dear Washington DC (Score:4, Informative)
I admit that I am a "deadbeat". I have some rather large, unclaimed and unpaid debts that are over 3 years old. Please let me know when you wish to take those over from me. Thanks...
Oh wait, how come it's different suddenly?
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Remember that debt has value, just like cash has value. There are situations where debt may be transferred between agencies (collections is an obvious example,) permitting other entities to collect on the debt.
Personally, I'm not sure I'd want the government tracking me down to collect. Based on the stories I've heard, they seem to be pretty good at it (See IRS.)
My Rights (Score:2)
I have the right to any tax dollars unused by the years end.
I have the right to any unused dinners and reservations wasted by D.C. politicos.
I have the right to any call girls paid who were unused because of erectile dysfunction of Senate,Congress and Cabinet.
I have the right to do the unused trophy wives as well.
I have the right to any liquor they have unused by years end.
Don't forget I get all your unused minutes too.
So clear the way, myself and a legion of well armed lawyers will be overtaking D.C. next
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I have the right to any tax dollars unused by the years end.
Like THAT ever happened. More likely you'll get the right to any deficit at the years end.
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Wait'll you see how me and the crack of my ass handle the deficit and any bills from World Bank.
I'm takin' us completely out of the system, setting a good example for the rest of the world.
Viva da revolution!
This suit needs to fail (Score:3, Insightful)
I personally hate gift cards and calling cards, but I think this suit needs to fail for several reasons:
1) The consumers that bought the cards paid for minutes. They did not deposit money on their cards, and minutes are not legal tender currency.
2) Many gift cards don't carry expiration dates. If the governments do this, it will force card issuers to put an expiration date on the cards.
3) Success in this litigation will embolden other governments that are looking for ways to close budget shortfalls without doing the fiscally responsible thing and cutting wasteful spending. Unfortunately, the first place where most governments choose to cut spending, instead of looking for waste, is in the school districts, police and fire precincts. Threatening cuts in those services makes it easier to justify doing stupid things like this, or raising taxes.
How about rebates? (Score:2)
I've wondered how long it was going to be before states start applying escheat or unclaimed property laws to unclaimed mail-in rebates that seem to infest the retail electronics business. For governments facing massive deficits, there's a lot of money sitting there, smiling provocatively.
Taking the Ads Too Seriously (Score:2)
And unused plan minutes too! (Score:2)
Hey, I pay for 1400 minutes every month, but use about 200. D.C. should be claiming those 1200 unused minutes as well!
Re:Yes!!! (Score:5, Informative)
Finally. I HATE the way retailers are predating on consumers. I do not give gift cards because of this. Companies are stealing by devaluing cards. They have our money, interest free. The gift cards should stay valid forever. I hope the government nails them on this hard. Retroactively too.
The problem is you have it backward. This sort of law did not come into being because of retailers devaluing gift cards, retailers started devaluing gift cards because of these laws. Back before gift cards, when there were only gift certificates, states started passing laws that if a gift certificate was not redeemed after a certain time, the retailer was required to turn that money over to the state.
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Citation needed.
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STFU statist. This is slashdot, and all problems are PROVEN to be caused by governments, not private corporations. No "citations" are needed. Who is John Galt?
Re:Yes!!! (Score:5, Interesting)
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Or, instead of "disguising" your laziness by telling someone else to do the research, you could do it yourself...
Or, instead of presuming that people will trust your words/opinions as much as you do, or decide that your as great an authority as you think you are, supply evidence to back up your claims.
What you think and say mean nothing if you can't back it with facts. If your too lazy to do so, you really can't complain when someone disregards what you say as meaningless, because, in essence, it is.
Re:Yes!!! (Score:5, Insightful)
As consumers, we might hate it, but you have to think of it this way... a gift card is an outstanding debt. A business doesn't want to have thousands or tens of thousands of tiny outstanding debts floating around FOREVER. That is the main reason there are "fees" to reduce the value of the card to zero when it isn't used.
It is the same idea as having checks expire after 180 days. If someone doesn't cash the check, it can't just sit out there "forever". The business needs to write off that debt so they can clean up their books. Otherwise, someone could come back 10 years later and cash it. Think of your own checks- would you like it if someone you wrote a check to sat on it for 5 years, then cashed it at a time when you least had the ability to pay for it?
I don't think it is unreasonable to have some type of expiration date or balance reduction time limit on gift cards, as long as it isn't too soon.
Re:Yes!!! (Score:4, Interesting)
"Think of your own checks- would you like it if someone you wrote a check to sat on it for 5 years, then cashed it at a time when you least had the ability to pay for it?"
Since my money is generally invested somewhere, yes. I'd love it if I got to collect interest for 5 years on every check I ever wrote. As for the other half of your question, I would think any sensible person would consider the money 'spent' as soon as the check was written, and not spend it on something else.
A.
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This is a bogus claim, because the alternative is simply not having the money. There are plenty of checking accounts with nonzero interest.
An example to make things clearer:
Imagine that you write 12 checks per year (one a month), each of which is in the sum of $1000. In case A they get cashed immediately in case B they get cashed one year later.
Case A: You make zero interest, each month $1000 is deducted from your checking account.
Case B: For the month you make $1000 * 1/12 of a year's interest. The seco
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Interest in a demand checking account is completely uncompetitive with interest in a savings, money market or CD account. In any case, your payee is making you do a lot of work maintaining liquidity just so he can have the convenience of depositing a check whenever he wishes. The point is that the money you've written to your payee is in suspense: it is yours, and you could allocate it if you knew when it was going to be demanded, but you don't.
The whole idea of a check is that it is as good as the makers
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i still don't see your point. what you're saying is that it would be better if you knew exactly when the check would be cached, because then you'd be able to actually invest your money until then, but that isn't an argument against a long period of time between check writing and cashing. it's the same as saying it would be better to have money than not have money, it's a trivial observation but doesn't contribute anything since there is no genie that gives you money just because you wished for it.
the fact i
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The fact that I can't even get away for idiocy of statements such as this while browsing at +3 is staggering. YOU'VE SPENT THE
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As for the other half of your question, I would think any sensible person would consider the money 'spent' as soon as the check was written, and not spend it on something else.
The problem with that theory is that it only takes one such check to make your account statements not match your own records from that point on, which would become a bookkeeping nightmare.
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I don't think it is unreasonable to have some type of expiration date or balance reduction time limit on gift cards, as long as it isn't too soon.
They already do. It's called inflation.
Re:Yes!!! (Score:5, Funny)
I agree. I can't imagine that there would be an organization (let's call it a "knab") that if you deposited money with them, got something in return, they could manage these outstanding liabilities that you could redeem for the product at any time in the future, near or distant. In the meantime, this fictitious knabs would be free to invest your deposit safely until you withdrew it. Knabs would have a terrible time trying to keep track of all these accounts on their books, and couldn't possibly make money, so much so that I can't imagine a world with a knab.
Also, what's so hard about keeping track of all these inactive accounts? It's not like they have many businesses have a hand-written ledger that they have to re-copy all account values around. Since all the accounts are likely similar, automated processing should be able to handle the number, whether it's processing 100 or 10,000.
Re:Yes!!! (Score:5, Insightful)
That's reasonable. There's one problem though - if the issuer can profit from unused balances the issuer has an incentive to encourage people not to redeem their gift cards.
Requiring unused balances be transferred to the public coffers removes that incentive and retains the benefits of gift cards that expire.
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"A business doesn't want to have thousands or tens of thousands of tiny outstanding debts floating around FOREVER."
They aren't debts. They are pieces of plastic or paper redeemable for stuff. Already paid for by yesterdays money that MIGHT someday be redeemed by another customer. A bankers dream. No wonder VISA and MASTERCARD have gift cards.
"That is the main reason there are "fees" to reduce the value of the card to zero when it isn't used."
Nope. It's so they get to earn interest AND keep the principa
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3-113. DATE OF INSTRUMENT.
(a) An instrument may be antedated or postdated. The date stated determines the time of payment if the instrument is payable at a fixed period after date. Except as provided in Section 4-401(c), an instrument payable on demand is not payable before the date of the instrument.
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Yes they will claim her "Nookie"... The Government's being screwing people for years.
GrpA