H&M’s $36m New York settlement over unused gift cards

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H&M will pay $36m to settle accusations that the fashion retailer illegally kept millions of dollars in gift cards that customers never used, New York Attorney General Letitia James has said.

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The Swedish company, whose full name is H&M Hennes & Mauritz, will pay $28.26m to the state and $7.74m to a whistleblower, William French.

James said H&M had since 2008 unlawfully kept at least $18.4m in unused gift card balances in its own bank accounts, instead of transferring them to the state’s Abandoned Property Fund.

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New York law requires gift card issuers to turn over unused card balances to the fund after five years of inactivity.

James also said H&M repeatedly lied about the missing transfers by saying an Ohio company, which had no obligation to send the balances to New York, handled its gift card business.

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“My office has zero tolerance for companies that disregard the law and line their pockets with money that belongs to hardworking people,” James said in a statement. “Violating the law is not trendy or tolerable.”

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H&M, based in Stockholm, did not admit or deny wrongdoing in agreeing to settle.

The company had no comment on the settlement.

H&M has about 4,800 stores worldwide, and posted net sales of 199 billion Swedish krona ($20.1 billion) in 2021.

French had sued H&M in 2016, accusing it of violating New York’s False Claims Act.

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In a statement, his lawyer Daniel Miller said taxpayers “should be thankful” for his client’s efforts.

Customers with unused H&M gift cards issued between 2004 and 2014 can use them at H&M, or file a claim with New York’s Office of Unclaimed Funds.





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