Federal Reserve Issues Final Rules for Gift Cards
On Tuesday, the Federal Reserve Board issued
final rules regulating gift certificates, store gift cards, and general-use prepaid cards. The rules become effective August 22, 2010, and will apply to all cards (that are subject to the rules) sold or issued on or after that date. Generally, the rules (1) limit dormancy, inactivity or service fees, (2) require certain disclosures, and (3) prohibit expiration dates less than five years after issuance of gift certificates, store gift cards, and general-use prepaid cards. The new rules are part of Regulation E relating to electronic fund transfers (12 CFR Part 205). The Federal Reserve also issued Official Staff Commentary of the new rules which provide detailed examples and descriptions of the new requirements.
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