In light of the March 2nd announcement that CertifiChecks has filed Chapter 7 bankruptcy, the Ottawa Area Chamber of Commerce (along with over 40 other chambers across the state of Ohio and hundreds of chambers throughout the nation) has had to make some important and difficult decisions.   Below is an article regarding information on the State of Ohio Attorney General’s lawsuit against CertifiChecks. 

Cordray Sues CertifiChecks for Misleading Consumers

MARCH 9, 2009

(COLUMBUS, Ohio) — Ohio Attorney General Richard Cordray today filed a lawsuit against a Dayton-based company, CertifiChecks, Inc., for failing to honor its gift certificates and for misleading consumers. The company, which had a national customer base, is charged with violating Ohio’s Consumer Sales Practices Act.

“This company shut down and left consumers with useless, unredeemed gift certificates,” said Cordray. “Consumers purchased those gift certificates thinking they could be redeemed at participating businesses, only to learn that now they can’t be used at all.”

According to the complaint filed in the Montgomery County Court of Common Pleas, CertifiChecks shut down its operations in late February. The company posted a notice on its Web site, certifichecks.com, stating it would no longer administer gift certificate programs and that it was in the process of filing Chapter 7 bankruptcy in Dayton. It also stated that consumers could submit unused gift certificates for potential reimbursement.

In the complaint, Attorney General Cordray charges CertifiChecks with violating Ohio’s Consumer Sales Practices Act by failing to honor gift certificates after accepting payment from consumers. Cordray also charges CertifiChecks with misrepresenting that consumers could submit unused gift certificates for reimbursement.  If CertifiChecks files for bankruptcy, all monetary claims (including claims for reimbursement of unused gift certificates) will need to be pursued through bankruptcy court.  The bankruptcy court will determine the amount of reimbursement each consumer is entitled to receive. Depending on the resources available, this may be only pennies on the dollar for individual consumers.

Attorney General Cordray asks the court to hold CertifiChecks responsible for reimbursing consumers and to declare that the company’s actions violate the law. Cordray also asks the court to impose upon CertifiChecks a civil penalty of at least $25,000 for its violations.

Consumers who lost money to CertifiChecks should file a complaint with Attorney General Cordray’s Office at SpeakOutOhio.gov or by calling (800) 282-0515.

We want you to know what we have invested in this situation.   Please note the information below.

·         In the last 12 months the Ottawa Area chamber has distributed approximately $17,500 in CertifiChecks--$7,150 of which was distributed in November & December of 2008. (This does not take into account how many were ordered directly from CertifiChecks by companies for employee gifts, incentives, etc.)

·         All accounting and reconciliation for this program is done directly through CertifiChecks, thus, participating members & chambers have no way to know the amount of unredeemed CertifiChecks in their surrounding community. 

·         The gift certificates are signed by CertifiChecks and redeemed by CertifiChecks through their account at Key Bank.

·         When businesses & community members placed an order for CertifiChecks or for general inventory, the chamber would call the order into CertifiChecks, who would then ACH the chamber account for the amount of the order.  The businesses then reimbursed the Chamber for that order.   Currently, the chamber is holding just over $1,175 worth of unredeemed and unreimbursed CertifiChecks—these funds will have to come out of our 2009 budget.

In a call to the Attorney General’s helpline we learned that consumers who lost money to CertifiChecks should file a complaint, individually, with Attorney General Cordray’s Office at www.speakoutohio.gov  or by calling (800) 282-0515.  We’ve gone to the website to possibly print off a form to make available for public use, but found that the complaint has to be filed on the website and can be confusing.  We felt that calling the 800 number was much easier.

If you have CertifiChecks gift certificates for which payment has been made, the CertfiChecks website states that consumers may send them in for potential reimbursement.   It is suggested that you make copies of these checks for your records. The redemption address is listed below.

CertifiChecks, Inc.
Attn: Redemption Dept.
PO Box 13603
Dayton, Ohio 45413

This in no way affects individual business gift certificates.  Many of our merchants and services have their own gift certificates which are available for purchase at their business location.