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This month, three Attorneys General filed suit against Simon Malls over its gift card. The action will fuel the controversy over how universal gift cards are regulated. The debate is whether the "Simon Malls VISA Gift Card" is considered a "mall-issued card" or a "bank-issued card." The card is provided to Simon Malls by Bank of America and is one of the largest universal gift card programs in the market today. Attorneys General from Massachusetts, New Hampshire, and Connecticut filed lawsuits claiming that the card program violates consumer protection laws. Like most universal gift cards, the Simon Malls card charges service fees, dormancy fees, and has an expiration date. Massachusetts "Gift Certificate law" requires that gift cards be redeemable at full face value for seven years. New Hampshire's "Consumer Protection Act" states that gift certificates may not expire and that such service charges, dormancy fees, or other administrative charges that reduce the value of the gift certificate are forbidden. Connecticut says the Simon Card violates its "Truth in Advertising" for poor disclosure of the costs associated with card program.

An example of another universal gift card heavily laden with fees is the new "Hello Kitty Debit MasterCard." The new card is aimed at young female “tweenagers” and offers a free one-year subscription to Elle Girl magazine. However, the card charges a $1.00 per minute fee to speak to a live agent, a 50 cent fee anytime a transaction is declined at an ATM or at the point of sale, an annual fee of $14.95, a monthly maintenance fee of $2.95, and a $10.00 fee to cancel the card. Under the program, inquiry fees through an automated phone system are 25 cents each while inquiries via an ATM run 50 cents each. Cardholders are also charged a $5.00 fee for making a cash withdraw from a teller within a bank or for using an international ATM. A $15 fee to replace a card and a $10 fee to reinstate an account are also assessed. The new card is issued by BANKFIRST and marketed by Legend Credit. For more information visit: http://www.hellokittycard.com.

A new survey shows that 83% of Americans will purchase gift cards during the upcoming holiday season because they give the recipient a gift of choice. The American Express "Gift Card Survey" reveals that 59% prefer a universal gift card, compared to 37% who said they preferred a store gift card. The survey also finds that Americans see gift cards as appropriate for all family members -- brothers (17%), sisters (15%), mothers (16%), and fathers (14%). One in ten Americans says they plan to give the gift cards to teens. Interestingly, double the number of men (8% compared to 4% women) plan to give gift cards to their spouse. While 69% plan to purchase them now through December, one in four (26%) says they will purchase them last minute, either the week before or the night before the holiday. One in five (21%) plans to browse for or purchase gift cards on Black Friday and the Thanksgiving weekend and more than eight out of ten respondents say that if they were to receive a gift card, they would redeem it within the year.

Another recent survey found that eight in ten women prefer to receive a gift card during the holiday season, which enables them to pick out their own gift at a store of their choosing. The VISA USA commissioned survey found that 40% of women say have been disappointed by a gift they received from a husband, father, or brother. A recent ValueLink survey found that 139 million Americans have purchased and/or received a gift card in the past 12 months, nearly double the 2001 figure. Also, the average number of gift cards purchased by a consumer has increased from 4.1 cards per year to 6.9 cards per year since 2001.

The number of consumers who purchase gift cards for themselves has skyrocketed from 2% in 2003 to 21% this year. Of these self-givers, one in five say they use the cards to purchase cheaper gas from large discounters where cash and credit are not accepted at the pump. The findings come from the annual gift card survey conducted by Comdata's Stored Value Systems. The SVS study found 75% of U.S. consumers, 15 years old and older, have now either purchased or received a gift card compared to 68% in 2003. About 60% of gift card purchasers buy gift cards for relatives outside of their immediate family and 44% purchase gift cards for friends. The average holiday gift card spending is expected to rise by 20% this year to $223. This year, the average card load is $42. SVS also found that 50% of gift card recipients always or often spend more than the value of the card and make up the difference with their own money. More than 40% of those who receive gift cards use them up within one month of receiving it, and only about 4% keep a card without using it for more than one year. The number one occasion for gift card purchases is birthdays (84%) followed by the winter holidays (68%).

The U.S. Postal Service has launched an online service enabling Americans to include a gift card with their customized greeting card. Cardstore.com and the USPS Web site are offering retail gift cards from five major retailers under the new "Gift-n-Card" program. Gift cards offered include Bed, Bath & Beyond, Lowe's, Circuit City, Brinker Restaurants (Chili's, Macaroni Grill, etc.), and Safeway. The company says more retail partners will be added shortly. The gift cards are available in $25, $50, $75, $100, and $200 denominations. The cost for "Gift-n-Card," excluding postage and the value of a gift card, is $4.99.

The Pennsylvania Liquor Control Board has launched the sale of gift cards in the state's 637 Wine and Spirits Stores. The cards are available in any dollar amount the customer selects. Customers can choose from two different card designs, as well as a variety of envelopes for special occasions, and the cards have no expiration date. The new gift cards replace the PLCB's current gift certificates, but existing gift certificates will remain valid until they are used.

Best Western and MasterCard are launching a promotion this month offering a $25 "Best Western Travel Card" for each stay when a MasterCard is used through year-end. To be eligible for the special offer, guests must register online prior to their first stay at http://www.goldcrownclub.com or call 1-800-237-8483 and mention offer code MC25. Individuals who are not already Gold Crown Club International members can sign up for the free program when registering for the offer. Each GCCI member is limited to four, $25 cards throughout the length of the promotion.

My "Big Fat Gift Card" has been an astonishing hit at the "Last Great Hamburger Stand." Fatburger Restaurants says it is selling six times more in gift sales since it switched from paper gift certificates to plastic gift cards. The card was launched one-year ago with Dallas-based Paymentech. Fatburger uses the slogan "Plastic, never tasted so good" to promote the card. Fatburger Restaurants, founded in 1952, specialize in made-to-order hamburgers served in a 1950s, retro-style decor. The chain has more than 60 restaurants in Arizona, California, Colorado, Florida, Nevada, New Jersey, Pennsylvania, and Washington.

And finally, America West Airlines has launched the first airline gift card. The new "America West Gift Card" will be available from thousands of stores including many Kroger Co. stores, Valero Food Shops, Diamond Shamrock Corner Stores, Staples, Winn-Dixie, and Bashas.