The real Costco
is not behind the pervasive cons that co-opt its name
by Marie Rohde, AARP, April 5, 2021
Joan, 79, a widow in Myrtle Beach, South Carolina, got an email
inviting her to take an online survey about Costco Wholesale. A former
customer, she didn't hesitate, thinking it was a way to entice her to return.
She was promised a gift for answering the survey and chose “a little, tiny,
one-ounce bottle of CBD oil, because I never tried it."
A retired postal worker, Joan used a debit card to pay a $5.95
fee for shipping and handling. Instead, she was charged $95 — more than she had
in her checking account — and slapped with a $35 overdraft fee.
Aghast at the CBD oil's price tag, Joan used certified mail to
return the package to the company and records show it arrived Jan. 7. She's
called a toll-free number for the company multiple times for a refund, to no avail.
“I have spoken to 11 different customer service guys,” she says, and “received
11 different excuses."
AARP is not naming the business. Its address is a UPS Store near
Los Angeles; it is not registered with California; and a call to its phone
number went to a call center, where a supervisor, “Marco,” when asked about the
potential fraud, said he did not want to be rude, but was hanging up. And he
did.
13 Costco scams
to avoid
1. Fraudulent satisfaction survey
4. Texts regarding loyalty reward
5. Overcharge reimbursement texts
6. Survey with exclusive offers
10. Fake interview confirmation
11. Fraudulent Executive Rewards
redemption
12. Citi Rewards direct deposit scam
Source: Costco
Scams add up to
a baker's dozen
Joan is not alone in having been ripped off by crooks who hijack
Costco's name — and hide behind it — to steal cash and personal data. These
criminals reach out in emails, texts, phone calls and posts on social media.
"It is an unfortunate fact of the Internet that at any
given time there are numerous illegitimate pop-up ads, surveys, websites, emails, social media posts and advertisements
that purport to be from or authorized by Costco,” the retailer says on its
website. “It is unlikely that Costco is affiliated with these promotions.” The
site lists 13 “currently known scams” including:
·
A fake Facebook post
showing a photo of Costco CEO Craig Jelinek who promises a “free Christmas food
box” with $250 in groceries plus a $35 Costco “voucher” delivered straight to
the door of every person who shared the post within 24 hours.
·
A sham offer of a free
Samsung 4K television — providing you complete a survey — as a way to
“personally thank you for always paying your Costco Companies Inc. bills on
time.”
·
A phony offer of a
$500 Costco Travel credit or Shop Card for completing a survey or a
reduced-price travel package in exchange for giving up personal information. (A
Costco Shop Card is a reloadable card used to pay for items.) This scam starts
in phone calls to both members and nonmembers, the site says, and some calls are “spoofed” so that the number on CallerID
looks local.
Giant global
footprint
Costco has 559 warehouse stores in the U.S. and 247 in other
countries. Why are its no-frills megastores popular? They may not be Arlo
Guthrie's Alice's Restaurant of film and song, but you can get almost anything
you want at Costco: a hot dog and soda for $1.50; organic fare and junk food;
flowers and wine; dog chow and diamond rings; clothing, appliances and
electronics; a vacation and, for one's final journey, a casket.
People pay an annual fee starting at $60 to shop at Costco,
which reports 108.3 million cardholders worldwide.
Anti-scam
advice online
Costco posts lengthy anti-scam guidance online. Richard
A. Galanti, executive vice president, chief financial officer and a company
director, said this in a short phone call: “We handle it, and the less said
about it, the better from the standpoint we don't want to send others out to do
it."
Costco is based in Issaquah, Washington, outside Seattle, and in
2019, Galanti spoke to The Seattle Times about a Costco scam
that went viral on Facebook. It seemed so real that his sister reached out to
him to ask if it was true: Was the company offering a $75 coupon for its “50th
anniversary"? (Costco was about 36 years old then.)
Scams “come and they go periodically,” Galanti told The Times.
“We've all clicked on something and afterwards realized we shouldn't
have."
Last year, the National Retail Federation ranked Costco as the
nation's fourth-largest retailer after Walmart, Amazon and the Kroger Co. Amazon, too, warns people
about fraudulent emails, web pages, calls and texts that exploit its name.
Hit your pause
button
AARP's Amy Nofziger, who oversees its Fraud Watch Network Helpline, 877-908-3360,
tells people that if they are evaluating a suspicious offer they should pause
and talk to a trusted friend. “Ask yourself, Why would Costco be giving away a
$500 gift card for filling out a survey? Does
that seem reasonable? They seem to be doing really well on their own,” she
adds.
Here's more
advice from Costco's website:
·
Unsolicited electronic
communications from Costco do not ask for information such as username,
password, credit card number, birth date or Social Security number.
·
If you receive an
order confirmation for something you didn't order from Costco.com, do not click
on links or open attachments.
·
If you receive a
communication that looks like it's from Costco, check who sent it. Check for
typos, misspellings and email addresses that do not end in “@costco.com.” When
in doubt, don't respond.
·
Be aware of an email
campaign advising people that Costco is offering them a job. The emails may
request a sham “processing fee” of several hundred dollars, which the company
says it never charges job hopefuls.
·
If downloading the
Costco app, make sure it is genuine.
Joan, like plenty of other consumers, says she had never read
any of that online advice before ordering the CBD oil. Today she wishes she'd
used a credit card for its stronger fraud protections. The worst part,
she says, was the “chaos” at her bank, where she had to freeze her account,
close it and open a new one, creating red tape over her direct deposits and
automatic payments. Still, she doesn't blame the retailer, saying the
fraudsters are at fault since they stole Costco's name — before disappearing
with her cash. “I'm speaking out,” she says now, “in the hope that I can save
at least one person all this grief.”
AARP’s Fraud Watch Network can help you
spot and avoid scams. Sign up for free Watchdog Alerts, review our scam-tracking map, or call our
toll-free fraud helpline at 877-908-3360 if you
or a loved one suspect you’ve been a victim.
Marie Rohde is a writer who formerly worked for the Milwaukee Journal Sentinel. Her byline also
has appeared in Bloomberg News, the Los Angeles Times,
the Chicago Tribune and Milwaukee magazine.
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