H&M to pay $36 million to settle claims over unused reward playing cards

Trend retailer H&M can pay $36 million to settle claims it illegally pocketed hundreds of thousands of {dollars} in unused reward card balances, New York Lawyer Basic Letitia James mentioned Thursday.

Since a minimum of 2008, the Swedish firm has unlawfully held greater than $18 million in unused reward card balances in H&M’s financial institution accounts, moderately than sending it to the state’s Deserted Property Fund, in line with James. H&M then repeatedly misled authorities in regards to the lacking cash by blaming an Ohio firm that oversaw its reward card enterprise, she added.

“My workplace has zero tolerance for firms that disregard the legislation and line their pockets with cash that belongs to hardworking individuals,” James mentioned in a press release. “Violating the legislation is just not fashionable or tolerable.”

H&M can pay $28.26 million to New York and $7.74 million to a whistleblower, William French, in line with a authorized submitting. French sued the retailer in 2016, accusing H&M of violating New York’s False Claims Act and a legislation on deserted property. 

H&M didn’t admit or deny wrongdoing within the settlement. The corporate didn’t instantly reply to a request for remark.

Based mostly in Stockholm, H&M operates about 4,800 shops across the globe and generated $20.1 billion in income final yr, in line with its web site.

Shoppers with unused balances in reward playing cards issued by H&M between 2004 and 2014 can use the cardboard or file a declare right here.

As a lot as 3% of reward card {dollars} are by no means redeemed, and about $3 billion in reward playing cards went unspent in 2020, in line with one estimate.

Reward playing cards are additionally a automobile for scammers: Any entity that calls for to be paid “by placing cash on a present card” is as much as one thing underhanded, in line with the Federal Commerce Fee.

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