Edit 14:03 29h March: And as always seems to happen, no sooner have we posted this story than a massive update happens - the Administrators have freed up the restrictions on Reward Cards - you can now earn points on purchases, and redeem them against pre-owned games!
On Monday, 26th March, GAME Group PLC, the company that run the large games retailers GAME and Gamestation entered administration. It followed a large period of financial turmoil, where a lack of finances left game unable to get insurance for its stock, which in turn meant several large publishers (Nintendo, Capcom, EA and Microsoft, amongst others), refused to give GAME new games to sell. This in turn made things worse for the cash strapped group, as it meant they couldn't stock major releases, such as Mass Effect 3, and Mario Party 9.
With the group entering administration on Monday, some 277 stores nationwide, out of a total of roughly 600 were closed on the same day. With the announcement of entering administration came a new set of management, and new rules for customers, some of which will undoubtedly inconvenience many of our readers. However, there are also several misconceptions being spread around amongst forums, and on major news sites, so we thought we ought to try and clear up what has, and hasn't happened.
The first, and biggest problem, that most major sites have reported on is that GAME and Gamestation will no longer accept returns. Several of their stores also have hand written notes to the same effect - but this actually isn't true. If you bought an item before the store entered administration, and it's faulty, you're entirely entitled to take it back for a refund or an exchange. GAME and Gamestation's websites both explicitly state this, yet most reports we've read have said that the stores simply aren't accepting refunds - and that's not true. If your item's faulty, you should be able to return it for a refund or exchange.
The second, and biggest problem, is that after going into administration, GAME and Gamestation have decided to not accept gift vouchers. This is a pretty low blow for consumers, especially those parents who may have bought a gift voucher for their child, before the whole situation began. At the time of writing, there doesn't actually seem to be any way around this, so if you have a gift card with anywhere from £5 to hundreds of pounds on it, it's now been rendered completely worthless. A similar thing happened when Zavvi entered administration in 2008 - thousands of customers found themselves with cash on cards that was suddenly, effectively, wiped blank. This is due to a rather annoying, and non-consumer friendly law that places gift card holders as store creditors - i.e. people owed money by the store. When a store enters administration, and the banks swoop in to try and reclaim the money their owed, the average joe ends up being pushed to one side and forgotten about. Sadly, the same is true for GAME and Gamestation's reward cards - any points or cash earned up until now simply can't be spent.
The good news, if it's possible to believe there is any, is that the money isn't entirely lost. You're well within your rights to write to administrator MJA Jervis and SD Maddison of PriceWaterhouseCooper to try and claim your money back. And hold out your ground here - they may not want to, but there's every chance you can make them budge. You can also try badgering your credit card company, if your vouchers were bought with a credit card, as you may have some sort of protection when a company enters administration.
As further good news, GAME and Gamestation also appear to be moving towards a buy out - which would mean the companies come out of administration, and, hopefully, the gift cards regain their value. Several companies have made offers for GAME Group, including OpCapita, who bought Comet for the nominal sum of £2. OpCapita, as far as we're aware, offered to buy the company and repay all of the creditors and suppliers, yet was turned down by the main creditor, RBS, who have now apparently tabled their own bid to take over the company. Potential dodgy dealings, and RBS? Surely not.
Either way, at the time of writing, a buy out is actually looking increasingly likely, so there is some hope for people who've been told their gift cards are now worthless, effectively losing hundreds of pounds. In the mean time, if you're sufficiently angry, it may be worth writing a letter to your MP about the whole situation and demanding a change in the law - after all, it's not really very fair that the consumer should be the one who loses out when companies mismanage themselves into oblivion, as has happened with GAME.
