U.S. Sen. Charles Schumer has asked the Federal Trade Commission to protect consumers holding Toys R Us gift cards that could become worthless if the toy retailer moves forward with a liquidation plan.
Schumer, D-N.Y., asked the FTC in a letter Wednesday to take action that would guarantee consumers could exchange gift cards for cash, even if Toys R Us liquidates and closes all 880 of its U.S. stores.
Toys R Us could file a court motion by the end of Wednesday that would set in motion the liquidation and closing of the chain after more than 50 years in business, CNBC reported.
Schumer, in his letter to FTC Acting Chairwoman Maureen Ohlhausen, asked the agency to make sure the company follows federal laws in any liquidation and gives consumers the option to receive cash for their unused gift cards.
He said the company, after receiving new debt financing before the holiday shopping season, gave consumers the confidence to buy gift cards from Toys R Us.
“It would be a sad toy story if those same consumers got gamed by a Toys R Us closure and were left holding useless gift cards that were intended to bring a smile to the face of a child,” Schumer said.
The Senate Democratic leader also asked the FTC to determine how many unused gift cards have been sold by Toys R Us.
Schumer was among the earliest supporters of a 2009 bill passed by Congress that established federal protections for consumers who buy gift cards, requiring the cards to be honored for at least five years after purchase, without any hidden fees.
