Late last week came the shocking revelation that the company that backed the gift certificates sold through the Van Wert Area Chamber of Commerce is filing Chapter 7 bankruptcy. The announcement make by CertifiChecks Inc. on its website has made an impact reaching far beyond the Van Wert County area.
CertifiChecks operated in 47 states with at least 40 chambers in Ohio and at least 23 chambers in Michigan using the service. Also the Army & Air Force Exchange Service sold certificates which were redeemable at local PXs, allowing military families to buy food, toiletries and other products for a soldier without having to mail the items.
Kate Gribble, Van Wert Area Chamber president, was briefed on the situation Friday afternoon. "It looks like our chamber has been pretty proactive in that most of the things they advised, we've done already," she shared. "In speaking with a rep from the Ohio Chamber, I was told that they have really been dealing in depth with the attorney general's office on this, and of course the attorney general's office is not willing to release too many statements, but apparently they are collaborating with attorney general offices from multiple states."
Kim Kowalski, a spokeswoman for the Ohio attorney general's consumer protection division, said the office is aware of CertifiChecks' situation but declined further comment. She would not say if the office had received complaints.
The certificates were backed by CertifiChecks and sold through businesses, organizations and chambers of commerce to be redeemed at local merchants. A message on the company's website gives an address where consumers can send the checks for "possible" reimbursement. "We urge people, if they do send their checks to that address, to keep a copy as proof, "stated Gribble.
CertifiChecks' shutdown has left millions of dollars worth of unredeemed gift certificates in circulation. Typically, the certificates would be spent at a local business as part of an effort to drive customers to shop locally. The retailer would then deposit the certificate at the bank, and the bank would get the money from CertifiChecks. The sudden halt to the program has left Van Wert County residents, and people all over the country, left with what could be worthless paper.
"We're talking about a grandmother who may have received this as a Christmas gift," said Cindy Larsen, president of the Muskegon Area Chamber of Commerce in Michigan.
Some businesses would buy CertifiChecks and give them to employees as bonuses or gifts. Just before Christmas, St. Anthony's Memorial Hospital in Effingham, Ill., handed out $87,000 worth of CertifiChecks to all 940 employees, most of them for $100 apiece. The hospital called them "economic stimulus checks" and held a surprise ceremony in the auditorium to deliver the gifts.
Kal Keitel, the hospital's director of human resources, said he felt sick after learning from the local chamber that CertifiChecks had ceased operations. He figures that about $30,000 worth of the certificates have not been cashed.
Locally, Gribble said she is unsure of exactly how much money is tied up locally in uncashed chamber certificates. She explained, "The problem is that all the accounting goes through CertifiChecks, so we don't know how many of the checks are out there. That's one of the biggest battles that chambers are having right now, finding out just how many of the checks are still out in the community that have not been redeemed."
As much as $1.3 million in CertifiChecks were in circulation in Michigan over the past year according to Bob Thomas, spokesman for Michigan Association of Chamber Professionals. "Some of the chambers have small operating budgets and won't be able to reimburse certificate holders," he said.
Read full story [Times Bulletin]
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