When it comes to gift cards these days, I must admit that I’m thinking about the saying, “caveat emptor” or “buyer beware.” I mean, I’m a huge fan of gift cards, as you know if you’ve read my past posts about gift cards. But recent stories about retailers in financial distress–and how that financial situation has left gift card holders holding worthless pieces of plastic–has caused me to feel a bit more cautious about gift cards.

For starters there were stories right after Christmas about Don Pablos, a chain of Mexican restaurants that a was all “here today, gone tomorrow.” Literally. People who had eaten there on a Tuesday might have shown up on a Wednesday to find the restaurant shuttered and empty. Turns out that Don Pablos’ parent company, Avado, filed for Chapter 11 bankruptcy protection in September 2007, yet continued to operate Don Pablos (and its other restaurants). And, as far as I can tell, it continued to sell gift cards to unsuspecting customers who gave them as holiday gifts. By December 27th, the cards were worthless, because the restaurants in places like Pennsylvania, Florida and Ohio were already closed.

Now comes the news that the Sharper Image (the original high-tech gadget store that was long one of my favorites before Brookstone ever came along with its cool stuff) has filed for Chapter 11. While it will keep nearly half of its 184 stores open for the time being, forget about using any Sharper Image gift cards you might have received as a gift. The store isn’t accepting them until it gets out of Chapter 11–if it gets out off Chapter 11, the skeptic in me says.

Even if a store does emerge from bankrupcy, consumers still may not benefit. That’s because when a business reorganizes after bankruptcy, there is a pecking order to which “creditors” are paid back. Keep in mind that gift cards are considered to be “unsecured credit.” In bankruptcy, “secured credit” holders are the ones that get paid back first. Here’s how Maureen Riehl, a spokesperson for the National Retail Federation explains it:

“First, the mortgages get paid, then the tax liens and the government get paid, and the banks get paid, because they have secured lines of credit. Then the owners of the company, and the stockholders, if it’s public, get paid, and you just go down the line.”

The folks holding gift cards? You’d be lucky if you ever recouped your money. (That’s me talking, not the NRF.) In fact, according to research from The Tower Group, by the end of 2008 consumers could lose more than $75 million in money they could have spent, just because stores and restaurants, that had originally issued gift cards, closed down. Ouch.

There have been some reports that Don Pablos’ parent company will eventually refund that gift card money, and maybe in the near future we’ll hear similar good news about The Sharper Image. In the meantime, if you still have gift cards to spend, why don’t you make doing so a priority?

I’m not trying to cause a panicked run on the bank, a la “It’s a Wonderful Life,” and the truth is the Targets and the McDonalds of the world likely aren’t going to be filing for Chapter 11 anytime soon–leaving you with a gift cards of no value. But if you haven’t made using up your gift cards a priority for your shopping, do your finances a favor and use that free money before it isn’t worth anything at all.