Gift cards became wildly popular gifts in the earlier part of this decade, and for good reason. They’re always the right size, match everything, and are just personal enough (by choice of store or service) to show that you put some effort into the purchase. But as much as gift-givers enjoy their simplicity and gift card recipients love their convenience, the real winners in the gift card game have been the stores that issue them.

In the past, stores made big bank on gift cards for three reasons. One, they locked the consumer into buying merchandise from their store. Two, many people never used them at all (commonly called skippage in the industry) which is the same as free money. And finally, merchants are able to invest the money paid for gift cards before they are redeemed (or “the float” in their parlance.)

However, for too many merchants, this gravy train wasn’t enough. Advised I’m sure by their business bankers, gift card issuers began tacking on fees for using the cards, not using the cards, bending the cards, shuffling the cards and not showing the proper respect to their gift cards and hurting their feelings. I might be exaggerating on a few points, but not by much.

So to combat the rise in these charges that deplete the value of gift cards, the government is implementing new rules to limit gift card fees. The new rules set by the Fed would prohibit issuers from charging dormancy fees on cards unless they have been inactive for at least one year. After that, issuers are limited to one fee per month. The rules would also stop issuers from charging monthly maintenance fees, balance inquiry fees, transaction fees, and reloading fees.

The Fed must issue finalized regulations by February 22, 2010 and they will be effective by August 22, 2010.

It’s amazing to see just how quickly the government has turned from lapdog of the financial industry to junkyard dog of consumer protection. But you are still the one responsible for making sure you get value from gift cards you receive. Use them soon, don’t dip into your own cash for bigger purchases than the value of the cards, and if there’s nothing you want to buy, trade in those cards for cash on eBay.