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HMV gift voucher holders are losers

Too late to spend in the stores
Thu Jan 17 2013, 15:46
HMV logo

HIGH STREET RETAILER HMV fell into administration this week and left a lot of shoppers with unspent gift cards.

Initially HMV's administrator Deloitte was accepting gift cards in stores. But then it stopped, something that is legally within its rights to do.

This is wrong, of course, and the chief of UK consumer rights organisation Which? said it is an example of a pressing need for a change in the rules.

"With the increasing number of high street retailers going bust, consumers need to be aware of their rights, particularly regarding warranties and gift vouchers," said executive director Richard Lloyd.

"While many groups can lose out when a company goes into administration, it is outrageous that consumers, once again, are left out of pocket when a retailer refuses to honour gift vouchers.

"We want the rules on gift vouchers and insolvency to be reviewed to ensure consumers are adequately protected in cases like this."

Customers are at the bottom of the pile, agrees web money saving expert Martin Lewis. Lewis' website, Moneysavingexpert offers a guide to those people who have gift cards. It makes for sad reading, with a glint of hope.

"Those who have gift cards are now effectively in that list of people the firm owes money to, but sadly are at the bottom of the pile. So while it is possible if the administrators get money, it could give a few pence per pound back, it's unlikely," said Lewis.

"More plausible is if the administrator is trying to protect the brand name of HMV to try to sell on as an asset, after deliberation it could decide to honour or partially-honour vouchers at some stage in future to keep the goodwill."

We asked Deloitte and HMV what is happening with the vouchers. We have not had any response. A Twitter search reveals that some HMV stores are accepting HMV vouchers. It might depend on the manager.

According to Citizens Advice gift card users do have a chance at redress, if they paid for their gift cards with a debit card, for example.

People with credit cards can apply for a refund through their card provider, if they had spent £100 on the HMV tokens, while debit card users can apply regardless of how much they spent. Citizens Advice recommends that people contact their card provider, Visa or Mastercard.

If neither of these apply you can try writing to Deloitte and asking it for a refund. This course, we are warned, has no guarantees and could take as long as one year to settle.

Trading Standards told us this morning, "It is not illegal for companies which have gone into administration not to honour gift cards." µ


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