Conference 2014
Andrew Johnson
Director General
Feedback from this year
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Not enough focus on gift cards
Too prepaid orientated
Not enough content to entice members
Good to see content from prepaid
Cannot justify 2 days away from office
Expensive to attend
Great networking
Confusion that Prepaid Expo Europe
incorporated UKGCVA Conference
Proposal
• Potential for UKGCVA Conference to be
standalone event
• UKGCVA Conference held in same venue on
same day (Prepaid Expo will be 2 days)
• UKGCVA will develop own agenda
• UKGCVA will sell delegate places to
UKGCVA members
• Joint evening networking event
Self Regulation
Background
• £4.7bn gift card and voucher
sales in 2012
• Big name brands disappearing
from the UK High Street
• What happens to vouchers and
gift cards when retailers enter
administration?
Gift voucher and gift card holders
become unsecured creditors – low
down the food chain, little chance of
getting money or goods
Background
• £4.7bn gift card and voucher
sales in 2012
• Big name brands disappearing
from the UK High Street
• What happens to vouchers and
gift cards when retailers enter
administration?
Negative Press
Government
Intervention
Negative Press
Government Intervention
The Coalition Government has requested a review of gift vouchers by the
Department for Business, Innovation and Skills – likely outcome may be
dependant on industry ‘self-regulation’
Labour, according to recent press reports want to see a change in the
Administration regulation to ensure gift voucher holders are given priority
Government Intervention
• Department for Business, Innovation & Skills
(BIS)
• Potential for self-regulation / ‘Code of
Conduct’
• Imposed regulation unlikely, but possible
• Across the whole industry – from local hair
salons to multi-national retailers
• Ring-fenced funds
• Breakage
Latest News from BIS
• Junior Minister, Jo Swinson
• BIS to host ‘policy workshop’ including
vouchers industry, consumer groups and
insolvency experts
• Possible ‘Ministerial Roundtable’ to formalise
results of policy workshop
Where we are
Meeting of UKGCVA Working Group in May
discussed:
• Full regulation – all programmes in Emoney
• Insurance Underwriting
• ABTA style scheme – all issuers of gift cards put % turnover into
central fund to ‘bail out’ administrations
• Safeguarding Funds – gift card/voucher float dedicated bank
account managed by you and a bank
• Trust Accounts
• Customer charged an optional additional fee to ‘insure’ their
card or vouchers against loss – either from customer losing or in
the event of issuer administration
Where we are
Meeting of UKGCVA Working Group in May
discussed:
• Full regulation – all programmes in Emoney
• Insurance Underwriting
• ABTA style scheme – all issuers of gift cards put % turnover into
central
fund to ‘bail
out’ administrations
These
options
will incur additional
• Safeguarding Funds – gift card/voucher float dedicated bank
costs by
oryou
will
business
account managed
and change
a bank
models
• Trust Accounts
• Customer charged an optional additional fee to ‘insure’ their
card or vouchers against loss – either from customer losing or in
the event of issuer administration
Agreed
Potential for gift card and voucher funds to be
set up in such a way that the holders of cards
and vouchers become secured creditors in
the event of the issuer going into
administration. Currently voucher and card
holders are unsecured creditors which puts
them way down the list if a pay out is made
However
• This approach has been disputed by some
members:
–
–
–
–
Secured creditors are not guaranteed to be paid out so this may lead to a false sense of security
It is not practical to register each voucher holder; only vouchers as a whole
May impede the Issuer to secure bank credit for general trading
For this to work CEO’s will need to agree and the industry (UKGCVA) will need to investigate
further
– How effective this will be for small voucher issuers such as hairdressing salons etc
• Consequently this was not taken forward to
BIS
• We do need to respond to BIS
Conclusions to date
• Some members believe all gift vouchers and
gift cards should be subject to Emoney style
regulation to ensure level playing field
• Closed Loop card and voucher issuers do not
necessarily ring fence funds, any changes to
this could cause significant internal issues
• No consistent view or way forward concluded
from members
Next Steps
• Please discuss with your company
• Waiting for dates to meet with BIS and
consumer groups
• Engaged with BDO to gain advice on how to
move forward
• Need to represent differing views from the
membership, acceptance we may take
forward conflicting views
Counterfeit Gift
Vouchers & Gift Card
Fraud
Wayne Harrington
Edenred
Tony Rich
Halfords
Gift Vouchers
• Increasing number of fraudulent gift vouchers
in circulation over the past 2 years
• More sophisticated copies
• Several UK police forces investigating
individual cases
Gift Cards
• Recent scam affected several retailers – may still be in
operation
• Cloning cards, gift card is presented at till, loaded by
operator before asking for payment.
• Payment is eventually not made and till operator cancels
card
• In the meantime second fraudster has spent the funds on
the card in another store, when till operator cancels card
the funds have all been spent
• Several retailers have evidence but none have reported
to police
Working Together
• How big is the problem?
• Should the UKGCVA take these issues to SOCA?
• How much data are members prepared to share?
• Are there other ‘scams’ to be aware of?
• Members use the ‘If anyone has heard of..’ email to alert fellow
members
• What next?
VAT
Nothing new to report
Meeting with HM Treasury postponed from April is
now on Tuesday 25th June