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Dick Smith collapse bad news for consumers

Dick Smith, the electronics chain with stores in Australia and New Zealand, has been put into receivership.

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The appointment of receivers and administrators to electronics retailers Dick Smith is not good news for consumers who may have deposits, laybys, gift vouchers or exchange cards or items being repaired with the company, Consumer NZ says.

The stores are still trading but have said they will not accept gift vouchers or exchange cards. The company has also said it will not honour deposits. Consumer NZ CEO Sue Chetwin said customers who had made deposits using their credit cards might be eligible for a “chargeback” from the bank which would give them most of their deposit back. However, customers would need to act quickly by contacting their bank.

People should also hang on to their vouchers and gift cards as if the store was sold or traded its way out of trouble, there was a chance the cards might be honoured. In the meantime customers should register with the receiver and become unsecured creditors.

If an item is in for repair and is relatively new, it may be covered by a manufacturer’s warranty which would mean it could be still be repaired and returned. However, there may be problems for consumers trying to find out information.

People with extended warranties look likely to have those honoured as it appears from the company’s website the underwriter is Virginia Surety Company and the warranties are administered by The Warranty Group Australasia.

For more information on what happens when a business goes into receivership see our Business sale or collapse article.

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