When Sharper Image went under (oh no, where will we find a new vibrating massage pinball machine for dad?), people lost about $60 million locked up in gift cards, reports NYT. If you’re holding a gift card, you’re technically an unsecured creditor. If they go bankrupt..

…it’s up to the company to ask the bankruptcy court to allow it to continue accepting gift cards. If they don’t ask, you’re out of luck. So spend them quickly if you get them, and before you buy them, maybe check the financial pages to see if the company is headed for Chapter 11. Aha, you say, I’ll just buy one of those ones backed by VISA or the like. Not so fast. If they’re backed by a bank or credit card company, they can have all sorts of hidden fees and various ways for them to quietly depreciate in value.

The Gift Card Comes Wrapped in Growing Risk [NYT] (Photo: paper house)

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