Fueling up for less is one of the ways people save money at Costco (even if it occasionally means waiting in a line of cars to do so). On average, Costco gas is less expensive than area competitors.
What keeps this perk so exclusive, however, is that you're required to scan your membership card at the pump. This can be your physical card or a digital card through the Costco app.
Either way, no card, no gas. This is where the scam starts.
Oh, no, I forgot my membership card!
"Darn it, my phone died and I can't scan my membership card. Can you scan your membership for me so I can fuel up and go charge my phone?"
The request could seem innocent enough. We've all had our phones die at the wrong moment or forgotten our wallets without realizing it until we're at the register. Unfortunately, extending a kind gesture could get you into a bit of hot water if the person on the receiving end is up to no good -- such as trying to milk every potential dollar out of stolen credit cards.
(According to online lore, the core of this scam is that Costco doesn't require ZIP codes to use a credit card, unlike other gas stations. It also helps muddy the waters, since the police have an easy line right to you.)
Your purchases are tied to your account
Part of scanning your card for access means that each time you fuel up at a Costco gas station, that purchase is tied to your Costco account. This includes information about the payment method you use.
Stolen credit cards get reported, and then authorities track down the purchases made. If your Costco account is tied to purchases made from a stolen credit card, you'll likely have some serious explaining to do.
At best, you get charged for the stolen gas and the cops don't show up. At worst, you're having to prove you didn't steal the credit card in the first place. But even if you wind up with the best-case scenario here, you still have to admit to Costco that you broke the terms of your membership agreement.
Costco can (and does) close accounts for breaking rules
The Costco membership rules are very clear about not letting other people use your membership card. Moreover, Costco has been very vocally cracking down on membership sharing over the last year.
If you're caught sharing your membership -- and yes, scanning your card that one time for that one person counts -- Costco can, and likely will, close your account and cancel your membership.
Costco has every right to prohibit you from ever joining again, too. And then you'd never have another Costco hot dog.
How to properly share your membership
Costco's rules are pretty strict, but there are still a few ways you can share the Costco love with your friends and family.
If you're the Primary Member (or Account Manager), you can assign one free membership card to a member of your household.
Each cardholder can bring up to two guests to the store on a trip. However, only the member can make purchases.
Members can purchase Costco Shop cards, which are gift cards for Costco. A Shop card gives non-members entrance into Costco and the ability to shop, but they'll need to use the Shop card to pay.
What to do if you're approached at the pump
Never scan your membership card for someone else to make a purchase. Instead, you can advise the struggling person to contact the station attendant.
If the person is really a member and having an actual issue, the attendant can help them. If the person isn't a member, they'll likely scurry away.
It's great to want to help our neighbors, but let's not forget common sense, too. Fueling up at Costco is rarely life or death, so the person can head home for their card or head to another gas station. You don't need to put your membership at risk.
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Buy Gas at Costco? Watch Out for This Scam was originally published by The Motley Fool