Gift Card Rescue Bankrupt
Last year I did my best to warn everyone about Gift Card Rescue. After a popular deal, many people including myself decided to sell cards to the company. Then, after the cards were sent in, Gift Card Rescue demanded more information from sellers and informed them that their cards would be forfeited if they didn’t comply.
I didn’t receive such a message, but it still took me more than a month to get paid for the cards that I sold. They lied about sending out a check that never came, before eventually sending out a check after I harassed them constantly and used this blog to shame them. My takeaway from the Gift Card Rescue selling experience was that they are both dishonest (i.e. they say they mailed a check when they haven’t) and probably broke. I guess I was right.
A Sad Notice
Will Run for Miles is reporting that the company has now gone out of business. After sending out a letter to sellers (victims) saying that all payments were temporarily frozen as of 7/12/16, the following letter sent from the company’s CEO today brings even worse news:
You are receiving this letter because you or your company sold gift cards to GiftCardRescue.com recently and are awaiting payments on those gift cards. Unfortunately, I regret to inform you that GiftCardRescue.com has closed down effective July 15, 2016. Our company was forced to shut down last week when a lender to the company (with whom we have been trying to negotiate a temporary forbearance) went to court and got a judgment against our company. With that judgment, they placed a hold on our business bank account, depleting all the funds in our account. Without access to our operating account, we had no choice but to
shutdown.. . .As soon as it became clear we could no longer operate, we stopped accepting new gift cards and have since returned all unprocessed gift cards to the respective suppliers. . .
I am sure you are wondering what will happen to the debt owed to you by GiftCardRescue.com. While I have pursued all efforts to find a way to pay the amounts owed to you, or to have another company in the secondary gift card industry assume and pay the obligations owed to you as part of a transaction, at this point my efforts have not been successful. If this circumstance changes, you will receive further communications to ensure you are properly advised. . .
I would like to thank you for trusting us with your business and regret that we were not able to send you payment for the cards you sold to us.
Additionally, their website does have the following message:
Buying and Selling of Gift Cards on GiftCardRescue.com is temporarily not available. We will provide an update soon. We apologize for the inconvenience.
What to Do?
I am not a lawyer so I cannot give any advice, but personally I might consider checking the balances on any cards sold to Gift Card Rescue. Of course those cards may have been sold to buyers and I have no idea as to who owns the funds in such a situation. Perhaps a lawyer could help, but either way it isn’t looking good if you decided to sell to this company and have yet to receive your funds.
Have you had any dealing with Gift Card Rescue recently? Feel free to share your experiences in the comments!
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Just found this site. Was ripped off by this company too. Sent them a $100 gift card and after months of emails they finally sent me a $60 check. Cashed it the same day that I received it. Few days later I received bank fees from my bank due to GiftCard Rescue putting a stop payment on their check. Now I am out the $100 gift card AND bank fees. If this company sold the gift card, I should be sent the $60 that I was promised. No response and/or no money from the Company. Notified the Better Business Bureau and they stated that there is nothing they can do. Thinking about going to ABC news and telling them my story. Maybe getting this on television and letting people know that Shark Tank helped this guy along in his business may make someone notice and help us all out! What do ya think?
I bought a gift card and have never received it and I got $63 balance in my account to spend on another gift card that a few weeks later I got an email that they went broke. What can I do to get my money back?
I bought a $300 e-gift card for $230 and I hadn’t used it yet when they went out of business. I immediately checked the balance after I received the email about them going out of business and it has $0 balance. Is there anything I can do to get my money back?
I am very happy for you, TB., and am glad you got your cards back with full values.
I sent GCR about $500 worth of cards in early June. They were marked as received two weeks later.
Yesterday, I received these cards back, with their full values intact.
Aaron – If I wanted to loan money to entrepeneurs with the understanding that I might not receive a return I’d be a venture capitalist or just use Kiva. I certainly had no idea that I was risking money by selling to a guy who did not have a sound business model. And you telling us “sometimes it just doesn’t work out” is really pricelss. Thanks. That’s so helpful. Why don’t you just have your nice hardworking friend write us some checks for the money he owes us or mail us back our gift cards?
Just finding this site. I had a similar issue with GiftCard Rescue. Sent Kwame Kuadey a $100 gift card on the premise that his company would send me a check for $60. After months of emails, the company finally sent me a $60 check. I cashed the check the day I received it and then Mr. Kuadey’s company put a stop payment on the check. Now I am out the $60 along with the bank fees I was forced to pay because of them putting a stop payment on the check. To date, I have not received a response and/or money for this transaction. He should return my $100 gift card. If he sold it, which he probably did to pay other clients, he should pay me the $60. I wrote the Better Business Bureau and they notified me that there is nothing they can do! Thinking about going to ABC news to let them know about this company. Maybe putting this on the television and letting every one know that Shark Tank helped this guy along in business and he ended up giving many people the shaft! What ya think? Maybe after the holidays…….
Hey folks, founder of a competing company here (Giftcard Zen) — wanted to share a perspective on the industry in general. It’s not easy running a gift card exchange with limited capital. Margins are super slim and competition is fierce. When a company goes under like this and people aren’t paid, people feeling anger/frustration is inevitable. I know Kwame personally and wanted to say that he went through great efforts to try to pay everyone. He didn’t walk away lightly, and I certainly wouldn’t describe him or CGR as shady. Knowing that doesn’t make it any easier if you lost money, but please know that he tried very very hard behind the scenes to make it work, for his employees and customers on both sides of the business, and sometimes it just doesn’t work out.
Aaron – thanks for lending your insights here. I’d be really interested to know if your company intermingles funds set aside for payments promised to sellers along with your company’s operating funds. If yes, then your customers should know they face the same risks. If not, then it seems like you would want to get that word out (instead of looking for sympathy for Kwame). I know the pains of losing a business. But there’s a big difference between exposing risk capital and customer/client assets.
FYI – I say this as someone who luckily got paid by GCR a year ago, but then heeded Shawn’s warning.
I agree that it was a mistake to use funds owed to people for running the business. 100% true, and no we don’t do that.
I totally agree with you Aaron.. I don’t think Kwame intentionally tried to screw anyone. He’s trying to do the best he can in this unfortunate situation.
I sold (4) cards for an aggregate payback amount of $116.43 on June 23, 2016. The cards were sent on the 24th of June, and I received two notifications from their customer service dept that they had yet to receive the cards. I repeatedly tried to correspond via email, and they still insisted the cards didnt arrive. I DO NOT believe they were being honest; because I had them sent first-class, and the cards were in fact delivered on June, 27th, 2016. So then, this is all making sense, and I will jump through every hoop in my attempts of getting the money they owe me.
I received this email today…
July 22, 2016
To our Customers:
It is with great sadness that I am informing you that GiftCardRescue.com has closed and ceased doing business.
The company I founded eight years ago and have worked tirelessly to build into a multi-million dollar business was forced to shut down on July 15th after one of our lenders froze our bank account. This happened without any warning.
In these circumstances, all we can do is to wind down our affairs, including letting our customers and others with whom we did business know of our closing. Gift cards that were purchased before July 15th have all been shipped to buyers. Gift cards received in the mail within the last two weeks from sellers that were yet to be processed are being returned to senders. If you have a pending payment or are awaiting a refund, you will receive a separate communication.
I sincerely regret this outcome and any possible impact to you. I would like to thank all our loyal customers over the years, some of whom have been buying discounted gift cards from us since we started in 2008. It was a pleasure to have you all as customers.
If you would like to send any communication to GiftCardRescue.com, please send it to the address below.
GiftCardRescue.com, P.O.Box 6244, Ellicott City, MD 21042
Sincerely,
GiftCardRescue.com
By: Kwame Kuadey,
CEO & Founder
Any thoughts on sending a DoS to giftcardrescue.com so they can’t liquidate their remaining inventory?
Filed a complaint to the FBI Internet Crime Complaint Center. ic3.gov. Checked out the balance of cards sold. ZERO Balance. Effectively selling stolen products.
I’m out $220; sent cards 5/3/2016, said they didn’t receive them until 5/23/2016. Lie. Processed payment 5/30/2016 but magically the check never made it, even though they told me it was in the mail.
Waiting for a class action to spring up. Question – what happens if we file in small claims? I realize if they did/do in-fact file for Chapter 7 or Chapter 13, it won’t mean squat, but couldn’t he/they be lying about that fact as well? Would it be worth the small fee to seek a Default Judgment on this clown?
yep! 22 days ago..cards verified ..mailing check within 3-5 days that was 3 days ago…I guess I won’t be seeing THAT check! I don’t have any of the gift card numbers so I can’t check balances..I’ve done business with them before and got paid.. (took over a month the last time, but still got paid) Wonder if there will be a class action suit or something, or are we all really out of luck?
I may be out $1500. Sadly never saw your warning, Shawn.
If their site says payment was sent on 6/27 and it (probably unlikely) arrives, would the check have a stop payment on it? My guess is yes.
Following to see what my next step will be.
I’ve been dealing with Gift Card Rescue since June 2, 2016. They have over $1,100 in one card I sent them. This has been a nightmare of a situation. I have emailed them countless times and spoken to them as well. After jumping through many hoops and harassing them they finally said my check was being sent. This was June 29, 2016. No check as of today, July 19, 2016 AND I received the email informing me they are shut down.
How do you guys find the info on your cards? Did you take a pic before you sent it in?
Wow, not surprised at all based on my dealings with them last year. Sold them some Zappos cards. They never paid me and I eventually told them to cancel the sell and used the gift cards myself. I’d do the same thing if I had open cards with them I was selling now. If you have the gift cards, use those on something for yourself. Let them know in case of legal drama but buyers can always file claim with credit company and get money back. Sellers are out of luck though. Tough deal.
Sold them $270 worth of Speedway cards about a month and a half ago. They claimed they never received them….Thankfully! I was successful in having speedway freez the cards and replace them. Hope gcr didn’t sell the cards to someone. I did email them twice to let them know the cards were worthless and not to sell them. I feel I dodged a bullet on this one.
They’ve probably run off with a few million squirreled away.
http://www.giftcardwiki.com/markets/
Seems Gift Card Wiki is not up to date. The average discount went from 21% to under 2% in the last week.
Speaking of Gift Card Wiki, I sort of put some of the blame on them. GCR’s shady reputation has been fairly well known for quite a while, yet GCW continued to list them along with the much more reputable buyers. They should have been removed a long time ago. Appears they put that click-money revenue ahead of their customer’s welfare. Not too impressed with that judgement.
Ahhh. Am I out $132 that they still owe me?!?!?
Well they are listing $1050 of my cards as not even received yet…and I’ve been emailing asking why, when I have USPS confirmation they were delivered. Guess I know now.
So, looking forward to any info on exactly how I file a claim against these guys
wish I’d seen your warnings, just started selling gift cards 3 months ago.
Guess I’m done now.
It’s interesting the “not available” message comes up right after you select sell, but not after you select buy. It could still be that the transaction would fail as you go to check out. It does let you select a card to buy and go to the cart.
I’m not sure that they are stopping the sale… If that’s the case, they are very very shady.
If there is a balance what would you do? If you then use the balance, and the card had been sold, you’re basically screwing the final buyer (who probably still has no idea there is any problem).
If they have not sold the card, but did process it, it would be seem to be a company asset subject to general creditor claims. Just like people have lost deposits when companies went under.
Right. It is fraud to use a card code you have sold – even if you did not get paid. You have no more right to use it than to break in and steal it back. Everything has to go through the bankruptcy process.
I have about $500 in value at GCR. Sent them in on June 16.
All cards still hold there original value at this point. Doubtful eBay/SVM will refund.
Only $100 of my $850 still have value on them. Hopefully some of the money we are owed get’s processed… If anyone has updates will you guys post here. They never even sent me the initial email, if it weren’t for Shawn I’d be in the dark about this.
Same here Tyler… I’m connecting with my lawyer friend tonight to see what action I/we can take. I can email others if they are interested.
Definitely, I’ll do the same as you and report back.
Please keep me in the loop. “Only” $207.50 here, but still.
I will join you Gary, please contact me when you decide to take further actions
Please let me know as well.
How are you guys finding the info on your gift cards to see if they are valid still? Did you take a pic of them before you sent them in?
I’m out $740 that they haven’t paid me. I guess i need to figure out how to make a claim against the company as a creditor…
I’m currently out $1.4k… This has me feeling all sorts of emotions. I called them a bunch of times over the last few weeks and have not received anything yet. They should not be allowed to sell your cards until you are paid. Now to go back and check the balances… This is really shitty timing as I’m planning to buy an engagement ring this weekend and was planning to have been paid at least part of the money owed.
To some (small) extent I feel for the company. Being an entrepreneur is tough. I’m not a lawyer or accountant, but there is no excuse for them intermingling company operating funds and funds collected from buyers to pay sellers. The spread they make, they are free to put into the company coffers. But a seller’s proceeds never should have been put at-risk. Again, I’m not a lawyer or accountant, but it seems pretty shady that they don’t have the funds to pay sellers (or at least give them back their cards if they weren’t sold yet). I’m glad that MtM’s readers learned quite a while ago to stay away from GCR. I feel most bad for the folks who didn’t get this warning.
I am out somewhere around $400 that they owe me. I for one will be pursuing a claim against the company as a creditor and hope to get some money back. Question, concerns and sympathies are an email away…
sub
i sold them some cards in March and finally got paid last month. My story is nearly identical to yours. Good thing I got my funds just before they closed down.
Don’t celebrate yet. Look up preferential payments and clawbacks. Don’t be surprised to get a demand to refund the payment to the estate for distribution to all general creditors.
If i were you, I would close that bank account and open a new one, or ask for a completely different account number to protect from claw-backs… Good luck mate
I left them a voicemail looking to be a bulk seller around xmas, got a call back bout 3-4 months later askign me if i still waned to become one… Yea, thanks but no thanks, if it takes you 3 months to call me back I cant imagine how long it would take for you to send me a check…
If you have cards you sold to here with a balance and did not get paid, seriously, deplete it asap… The buyers have CC protection and can dispute it. CC companies have a way of getting their money back from slime balls like these people… This dude prolly sent that email out from the drivers seat of his benz from his brand new iPhone 7 after closing his “business” bank account . Notice how he says nothing about filing bankruptcy…
Won’t work plus be careful to opening yourself to a fraud charge. The bankruptcy trustee has a duty to determine who received preferential payments.
I am a gift card buyer, and I would be really upset if I found out the original seller of my card depleted it. It’s not the right, moral, or ethical thing to do, to pass the problem unto the buyer of that card. That makes you no better than the people you call slime balls.