HMV accused of dishonesty for refusing vouchers

Thousands of people have been left with worthless HMV gift vouchers as the retailer confirmed it has gone into administration.

Consumer rights groups as well as public representatives accused the music retailer of dishonesty yesterday, as it confirmed it would not honour any outstanding gift vouchers, despite selling them up until Monday evening.

Up to 300 jobs across HMV’s 16 Irish stores are at risk if a buyer for the company cannot be found.

Staff at Irish stores told customers yesterday HMV that it will not honour outstanding gift vouchers, in a move the National Consumer Agency branded as “disappointing”.

It called on HMV to reverse the decision so as not to leave thousands of consumers out of pocket.

“In our view — and in the context of the timing — this decision by the administrator is very regrettable. If the administrators want the company to survive and restored to profitable trading, they should consider the impact it will have on the future of their business,” an NCA statement said.

“Although there is no legal impediment to the administrators taking this decision, the NCA will be pushing for the administrator to reverse this decision not to redeem or refund these vouchers or at the very least, to give HMV customers in Ireland more clarity about whether this position could change in the future.”

The NCA advised consumers who paid for a gift voucher using a Visa or MasterCard credit or debit card to contact their card issuer to see if they can get their money back through the Visa or MasterCard chargeback process on the basis that the service paid for was not rendered.

Dermott Jewell, CEO of the Consumer Association, issued similar advice to those who purchased gift vouchers from HMV and said his organisation had been in touch with the Director of Corporate Enforcement on the matter.

“We have asked that office for their advice in the context of the refusal, and also the fact that the company were aware of their potential inability to meet their financial commitments in mid-Dec 2012, at which point they could have ceased the sale of all vouchers, tokens, and cards to customers,” he said.

Speaking in Dublin yesterday, Communications Minister Pat Rabbitte said HMV’s refusal to honour gift vouchers was “immensely regrettable”.

“It is an immensely regrettable decision that the company has chosen not to honour commitments entered into with consumers, because this unfortunate situation was not a surprise,” said Mr Rabbitte. “I hope that the administrator will be able to come to some sort of arrangement with consumer associations.”

With the future of the retailer hanging in the balance, CEO Trevor Moore said yesterday he was confident a buyer could be found and that HMV will remain in business.

“I’m confident that we will find a solution,” he said. “We remain convinced that we can find a successful business outcome. We know that HMV is a well-loved brand, which has a high level of support amongst the public and we want to ensure that it remains on the high street.”

It is understood there have already been expressions of interest in the retailer. Private equity firm Endless LLP has said it has been in contact with administrators Deloitte with a view to buying the company.

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Here are a few facts about the 92-year-old music retailer

*The chain was founded in 1921 with the arrival of its landmark store on Oxford St, central London.

*It was opened on July 20 that year by the composer and conductor Edward Elgar.

*The company became known for its “His Master’s Voice” trademark, the name relating to a 1898 painting of a dog called Nipper listening to a gramophone.

*Tragedy struck at the HMV store and offices on Oxford St on Dec 26, 1937, when the shop’s caretaker William Travis died in a fire, which destroyed the building.

*During the Second World War, the Oxford St store stayed open for business while parent company EMI’s record factory at Hayes, west London, was used to make munitions.

*The Waterstone’s book chain became part of the HMV stable in 1998 but was sold off in 2011 as the troubled music chain attempted to get its finances in order.

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