Call for reform to resolve gift card scandal

New legislation to protect consumer rights.

Independent Senator Nick Xenophon (pictured) has called for legislative changes for customers with Dick Smith gift cards and those who have paid deposits. He has proposed three changes, according to a Fairfax media report.

senator nick xenophon

Firstly, there should be an obligation on external administrators to honour gift cards by way of greater priority as creditors.

Secondly, money from gift card sales and deposits should be kept in a separate account.

Thirdly, directors of companies that collapse should be personally liable for the value of gift cards or deposits, including lay-by.

“These proposed reforms, which will be contained in legislation I will be introducing into the Senate next month, will finally give consumers the protection they deserve,” he said.

“The reforms, if passed, will also have the effect of strengthening consumer confidence in gift cards which has been shaken with this collapse.”

Meanwhile, Queensland Councillor, Paul Tully, started a petition on on Sunday, and by 2pm on Monday, it had received 417 supporters.

Tully says Ferrier Hodgson has embarrassed those who gave and received gift cards over Christmas.

“The receivers have acted in a cavalier and unreasonable manner and should hang their heads in shame,” he said in a statement.

Supermarket chain digs deep to help customers

On Friday, Coles offered to exchange Dick Smith gift cards bought at its supermarkets before Dick Smith’s collapse this week for Coles gift cards of equal value. Coles has also written to Dick Smith’s administrator McGrath Nicol, urging it to honour outstanding gift cards.

Meanwhile, Harvey Norman New Zealand  has given a laptop to a 10-year-old girl lost her digital dream with dodgy Dick Smith voucher.

Zoe had saved $280 from money she earned doing household chores to buy a laptop from the electronics mega-store Dick Smith. Her mother, Rachel, topped her savings and bought a $480 Dick Smith voucher that she planned to redeem this week.
DickSmithCard 2

However, Dick Smith’s receiver has said this week that vouchers, deposits and deliveries cannot be honoured because of its financial situation, leaving many customers out of pocket.

A company spokesperson said they were planning to bring Zoe into one of its Botany stores this month where she would be able to pick out a device.

Rachel said she was “stoked” with the news and was happy she would “not going to have an upset little girl”.

Bodo Lang, senior lecturer in marketing at the University of Auckland Business School, said it was a “great move” on Harvey Norman’s part.

“The cost of the laptop would be, say, $500 but the media mileage and public relations goodwill you get out of these sorts of actions will be a hundred times greater than the small cost they will incur for it,” he said.

“You could be naive and say ‘this is just a lovely thing and they [Harvey Norman] are just doing this’ but if they were doing it just for the benefit of the girl without wanting any other benefit then they would do this very quietly behind closed doors…but it’s just good business sense to share this,” he said.

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