Unclaimed money in New York State often includes forgotten gift card balances. A recent settlement requires H&M, the popular fashion retailer, to return millions in unused gift card funds to the state’s Abandoned Property Fund. This victory for consumers highlights the importance of understanding unclaimed property laws and how to reclaim your money.
H&M’s Unlawful Practices Regarding Gift Card Balances
New York Attorney General Letitia James announced a significant recovery of $36 million from H&M. The company unlawfully withheld unused gift card balances that, by law, should have been transferred to the Office of Unclaimed Funds under New York State Comptroller Thomas P. DiNapoli. H&M not only failed to transfer these funds but also misrepresented their gift card practices to the state, falsely claiming an out-of-state entity managed their gift card business. This settlement mandates H&M pay penalties for their deceptive actions and transfer the owed funds to New York’s Abandoned Property Fund.
New York’s Abandoned Property Law and Gift Cards
New York law stipulates that unused gift card balances must be turned over to the state’s Abandoned Property Fund after five years of inactivity. This law applies to many retailers, including H&M, who receive payment for gift cards but haven’t provided merchandise in exchange for the full balance. While H&M sells gift cards for both online and in-store purchases, a portion of these cards inevitably go unused. This settlement ensures these unclaimed funds are rightfully returned to their owners or the state.
Investigation and Whistleblower Lawsuit Leading to Recovery
The Attorney General’s Office (OAG) launched an investigation into H&M following a whistleblower lawsuit filed under the New York False Claims Act. The investigation revealed H&M knowingly withheld millions in unredeemed gift card balances, deliberately circumventing the law. Despite being aware of their obligation to transfer these funds as early as 2008, H&M entered into a deceptive contract with an out-of-state company to create a false impression of compliance.
H&M’s Deceptive Practices to Conceal Non-Compliance
H&M’s efforts to conceal their non-compliance included falsely informing the state that their gift card balances were transferred to the contracted company. However, H&M continued to control the gift card business, retaining the unredeemed funds. They even submitted a fabricated letter claiming the contracted company had disbursed millions on H&M gift cards, a blatant falsehood. Despite repeated inquiries from the state in 2011, H&M persisted in their deceptive practices.
Settlement Details and Reclaiming Your Unclaimed Money
The settlement requires H&M to pay over $28 million to New York State, with more than $18 million allocated to the Abandoned Property Fund for unredeemed balances on gift cards sold before 2015. The whistleblower will receive $7.74 million. Consumers with unused H&M gift card balances from 2004 to 2014 can use their physical cards or file a claim with the Comptroller’s Office of Unclaimed Funds. This case underscores the importance of checking for unclaimed money in New York State, as you might be entitled to forgotten funds.
Conclusion: A Win for Consumers in New York
The H&M settlement serves as a significant victory for consumers and reinforces the importance of corporate accountability in adhering to unclaimed property laws. By returning millions of dollars in unclaimed gift card balances to the Abandoned Property Fund, this case highlights the ongoing efforts to reunite New Yorkers with their rightful funds. Remember to check the Comptroller’s website to see if you have unclaimed money waiting to be claimed.
