AG may help consumers who encounter gift card troubles

Q. Like a lot of others, I am stuck with several hundred dollars worth of Dinegift certificates that are no longer accepted at area restaurants. Is there any update on Dinegift? Is there any recourse against the owner?

Maxine Milstein, Newton

A. The news isn't good. The Framingham-based company was serving its customers well for several years before running into trouble. The idea was appealing - buy a single gift certificate that could be used at any of more than 100 New England restaurants.

Over the past couple of years Dinegift ran into financial problems and fell behind in its payments to the restaurants, which in turn led restaurants to stop accepting the card, as you and many others have experienced.

Dinegift has stopped selling cards and its owner has said he's trying to keep the company going and pay those he owes. Like many small businesses that run into trouble, when cash is gone, there's nothing left to fall back on. He said in the fall that he had borrowed money from relatives and drained his own retirement account.

"As you know many businesses have been hit hard during this recent economic downturn," the company says on its website. "We are taking some time to advance our product and reassess our business model."

People who have tried to use the Better Business Bureau as an intermediary to recover money have failed, earning the company an F, the BBB's lowest rating. But there is something you can do to try to recover some money.

You should file a complaint with the Massachusetts attorney general. Call the office's public inquiry line at 617-727-8400.

If a business has taken your money and you get nothing in return, the attorney general has the ability to pursue legal action to try to compel the business to provide compensation. It is unfortunate that Dinegift has run into such hard times, but it's far worse that you and others are holding onto an apparently worthless card that was paid for with real money.

Sadly, this is a good example of why gift cards can be problematic. And, consider that at least one survey has found one quarter of gift cards go unredeemed and another found that about $100 million was lost on gift cards with companies that went under just this year.

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