If you shop the malls at Christmas, you've seen the Simply Certificates kiosks – gift certificates good toward purchases at dozens of Buffalo restaurants and spas.
The company is operating illegally, according the state attorney general's office.
Now, the state is suing the company's owner, Red Storm LLC, for fraud.
Both federal and state law require companies to provide a five-year expiration window on gift certificates. Simply Certificates, however, stamped its certificates with a one-year expiration date. When customers tried to call the company to have certificates reissued, the company never called back, the suit alleges. The company also failed to disclose certain fees.
The attorney general is seeking restitution for customers, plus penalties and costs. It also wants Simply Certificates to cease operations in New York State until the company has made restitution, and said its owner Red Storm LLC is not authorized to do business in New York because it is not registered with the Secretary of State, according to the suit.
If you have a Simply Certificates certificate and want to file a complaint, call the attorney general's office at 800-771-7755.
After the Christmas sales season, Simply Certificates put a notice on its website that customers would have to pay extra fees in order to exchange expired certificates. The policy required customers to pay a $5 restocking fee per certificate plus $4.95 for postage and handling. The company also required the certificates be returned via certified mail. The company has since removed that notice from the website.
The "orders and returns" tab on the Simply Certificates website had a single message: "Holders of Expired Gift Certificates, please note ... We are sorry to learn that you have chosen to disregard the Code of Acceptance and let your certificates expire. But, we can help." It goes on to list a phone number customers can call to have their certificate reissued after expiration. But no one returned phone calls made to that number, the attorney general said.
On Christmas Eve, Simply Certificates owner Bob Lynn was manning the Boulevard Mall kiosk, but identified himself to a Buffalo News reporter with a fake name. After the reporter identified that Lynn was the owner, Lynn said he was following all laws concerning gift certificates, but declined to elaborate.
The certificates were sold at Walden Galleria, the Boulevard, McKinley and Eastern Hills malls, and at the Wyoming Valley Mall in Pennsylvania.