Funny about Money

The only thing necessary for the triumph of evil is for good men to do nothing. ―Edmund Burke

Citigroup Charges Costco Bill on Inactive Visa Card!


Costco’s Big Move from American  Express to Citigroup’s Visa card went into effect two days ago.

I detest Citigroup and would not do business with them if they were the last bank on earth. The immediate cause for this disdain had to do with a charge that I needed to challenge, which led me to discover that Citigroup’s customer service doesn’t suck because Citigroup doesn’t have customer service. At that time, I canceled the Citigroup Visa I had and determined never to have anything to do with Citibank or Citigroup again.

So as you can imagine, I was dismayed when Costco announced it was dropping American Express, whose customer service is stellar, and replacing it with sh!t Citigroup Visa. I do not want to lose AMEX, so I sign up with them for two new cards, one for me and one for the S-corp, and figure that after the Costco Amex cards expire, I’ll pay with a debit card or a check if and when I shop at Costco.

Paid the last personal Costco AMEX bill on April 27 and the last corporate Costco AMEX bill on June 2. Balance on both cards: $0.00

Meanwhile, Citigroup sends me shiny brand-new Visa charge cards. The first to arrive, I dropped into a file folder, figuring maybe I should keep it, just in case. The second, for the S-corp, arrived two or three weeks later and got stuck in the pile of paper that mounds up on my desk like a sand dune until I shovel it off. Today I haul out the shovel and what do I find in one stack but this card, still stuck to its piece of paper.

I have never called the 800 number to activate either one of these cards. I decide I should cancel them both, given the ever-present chance of hacking and fraudulence.

But now, naturally, I can’t find the file folder where I deposited the first card. So I don’t have the card number. Maybe, I think, the guys at Costco’s customer service desk have it. Maybe they can even cancel the cards from their end.

Remember: neither of these cards has ever been activated. Hold that thought.

So I schlep to Costco in the 111-degree heat, hike across the 160-degree parking lot, and pounce the unsuspecting Costco CSRs.


Not surprisingly, they can’t cancel either card. But they do come up with the last four numbers of the missing card. With this bit of data, they think, I should be able to cancel the missing card, especially if I tell a Citibank Visa CSR that it’s missing.

That, of course, is assuming I can get such a person on the phone. The piece of paper to which the corporate card is still stuck has NOT ONE CLUE to how to reach a human being. Nor does it show a snail-mail address. But the desk manager there does find a flyer that has a purported customer service phone number.

While I’m chatting with the Costco guys, I ask the manager if the membership fee is automatically charged to your credit card (since I haven’t been dunned at the cash register for awhile, this thought has crossed my feeble mind). He says that can’t happen unless you’ve specifically arranged to make that happen. I don’t recall having done so, but anything’s possible.

I drive home through the 111-degree heat and call that number, not expecting much. Citibank’s 3-step MO is to give you a) a recorded message telling you how busy they are (you, of course, being a prole, have nothing else to do but wait on the phone), then b) put you on hold for ten or fifteen minutes, then c) disconnect you. It’s almost impossible to get through to a person, and when you do, the poor wretch usually can do nothing for you.

Don’t believe me? Check it out! If that’s not enough for you, there’s far, far more.

But evidently Citigroup has tried to clean up its shoddy customer-service act for Costco, at least at the outset. It only takes about eight or ten minutes to reach a person, though that’s after I’ve called twice trying to make my way through the punch-a-button maze. This guy indeed is able to close the personal credit card account with nothing more to go on but the last four digits.

I should’ve told him I’d lost both the cards. But nooo…I cannot tell a lie! What is the matter with me?

When I give him the corporate card number and say I want to cancel that, too, he says he has to give me to some other CSR to do that. So again I wait about ten minutes till another guy comes on the line. Again I have to explain why I want to cancel: i.e., “I wouldn’t do business with Citigroup again if it was the last bank on the planet.” This is the fourth time I’ve had to say that today.

He says the card is now canceled, but I owe them $59.73.

Sidebar: Citigroup contrived to purchase American Express’s loans, so whatever might have been outstanding on the canceled Costco AMEX card is now an outstanding debt to Citigroup. Willy-nilly.

I say I don’t think so. The balance on the AMEX card was zero when I paid the bill and nothing has been charged on it since.

He says — get this! — the $59.73 charge is for the Costco membership!


That means that Costco was able to charge a bill on a Visa card that has never been activated!

I say, I do not want my Costco membership automatically charged to any credit card and I did not ask to have that happen. Take it off! If (I think but do not say) I actually had arranged to auto-charge the membership fee, I would never have put it on the corporate card, because my son’s membership is on it, too. He is not on the corporation’s board and not an employee or contractor.

He says I’ll have to go back to Costco, have them issue me a refund, and then pay them with some other tool.

I schlep back through the 111-degree heat (the sky is clabbering up: it’s getting humid). I trudge across the 160-degree asphalt again. And I again pounce the customer service desk guys.

It takes some doing to explain to them that Citigroup engrossed this charge after the AMEX card had a $0 balance and so could not have transferred it over as an outstanding debt. It means that the membership fee must have been charged to the Visa card, since there was no way to charge it to the defunct AMEX card. The manager soon sees the issue. He agrees to issue me a refund on a card that has not been activated(!).

Amazingly, this works.

I now try to pay the membership fee on my debit card. But the payment won’t go through. Costco’s swipe machine won’t accept my PIN!

Understand, yesterday I racked up $80 at the Whole Foods on that card, with that PIN. I propose to pay with a check. He suggests I just not enter a PIN and it’ll charge as on a credit card.

Despite knowing that when you choose that option, the credit union’s debit card racks up debt on a Visa card (undoubtedly goddamn Citigroup’s), I decide this is the path of least resistance. I know it’s asking for trouble, because I’ve never once seen a bill from the CU after this has been done. But I think let’s just get this over with!

So pretty clearly I’m not going to be able to buy gas at Costco with my debit card. This a major inconvenience, because they have the best price on gas in town, and because their nearest gas station is much safer for a vulnerable single woman than anyplace else in the central part of the city. Oh well. I guess I can buy a cash card once a month or so and use that.

Or not. There’s a limit to how much unnecessary hassle I’m likely to put up with.

But the point here is that they somehow managed to charge up $60 on a credit card that was never activated.

Entertainingly, I’m not the only one who’s enjoyed this adventure: a current of pure rage is streaming through Costco’s website. A lot of people are saying Citibank is trying to charge them for transactions that they had already paid on their AMEX bills! So I guess I’m lucky $60 is their only unpleasant surprise.

If I find I can’t use the debit card to buy gasoline, I may look into Sam’s Club. Their website suggests their stores are very similar to Costco’s. Problem is, this area is liberally salted with Costco outlets — there’s one near every one of my beaten paths. To shop at Sam’s Club, I’d have to go quite a distance out of my way.

That might not be a bad thing, though. If you don’t shop in warehouse stores, you can’t spend copious amounts of money in warehouse stores…


Author: funny

This post may be a paid guest contribution.


  1. I’d be careful using debit cards, especially for gas. Sometimes gas stations use unsecured Wi-Fi to connect the gas pump system to the main registers inside. Easy way for your debit info to be stolen.

    In addition, I’d avoid using debit for anything but cash, being that fraud protections are instantaneous with a true credit card since that 2009 law. Debit cards, even Visa cobranded debit, are not protected by a law and is up to your bank’s discretion.

    Also, unless your bank is Citibank, your Visa processor is not guaranteed to be Citigroup.

    • Yeah, it’s definitely a serious concern. Even a credit card at the gas pump, IMHO, has its potential risks. I guess if I’m going to keep buying Costco gas, I’ll have to go inside and buy a cash card to use at the pumps.

  2. Funny, This would be funny if it wasn’t so sad. And you have convinced me by this…”adventure” to never join a “warehouse club”….Aldi will be just fine for me thank you. BUT I will share the folks at American Express are not without sin. I recently audited my Amex bill and discovered I had been credited no rewards for gas purchases (3%). So I called the Amex folks and got a rather “snarky” CSR who explained that even though my local gas station has the word gas station in it’s heading….it’s not considered a gas station…WHAT??? And I WAS getting 1% any way…..WHAT??? I asked what was the protocol for addressing this discrepancy as I thought that this goes back to January 1st of this year…She informed me there is no protocol as they have done nothing wrong…WHAT???? I explained I wasn’t very happy about this and especially wasn’t pleased with the notification I received notifying me that my annual fee has went from $75 to $95. IMHO this is to compensate for the loss in business at Costco. Went back and I figure these fine folks have “shorted” me $20 or so in the last 5 months. Based on this I’m taking a hard look at “our relationship” and I’m thinking maybe we should part ways. Maybe I just expect too much…..BUT this is nothing compared to the madness you are experiencing….111 degrees…..sheeez.

    • It is typically the merchant who identifies the business type when setting up their merchant servicing agreement rather than the banks trying to make that determination. The gas station must have used some business type code other than gas station.

      I know it’s frustrating not getting the rewards we were expecting. The gas station I used to use also had an auto repair shop and thus didn’t code themselves as a gas station. I ultimately switched stations to get my cash back rewards for gas. For me the increase in gas price was less than the increase in rewards I received so it was a net benefit for me.

    • Wait, what??? A gas station is not a gas station because…oh yeah: because it’s a convenience store. That would be “convenience” you were pumping into your car.

      I don’t usually buy gas anywhere else than Costco unless I’m so low I can’t get to a CC. Gas prices in Scottsdale and other suburbs are very inflated. In town, a few stations are only a few cents a gallon more than CC, but the risk of mugging or carjacking is a lot higher. I don’t like being panhandled, a regular happening in the central part of the city. The guys who shuffle around being nice to customers at the Costco gas stations also have the effect of a security guard — the panhandlers don’t go anywhere near the CC pumps. I just feel a LOT safer there.

      Month to month, I keep a pretty close eye on the AMEX statements and so far haven’t spotted any irregularities like that. I surely HAVE appreciated getting $300 or $400 back once a year, but the new AMEX cards simply deduct the cash-back awards from the bottom line each month. So I guess it’s a kind of a wash. Both cards are no-annual-fee deals.

  3. Please, please, please, PLEASE (!!!) do not use a debit card to purchase gas, especially using pay-at-the-pump. It’s too easy for criminals to attach skimmers to the machines. The consumer fraud protections for debit cards are woefully weak compared to credit cards, and if something happens it could take days/weeks to get money back from a stollen/skimmed debit card. I personally only use my debit card if I need to get cash from my bank’s ATM.

    If you don’t want to use the Costco/Citi cobranded VISA card, I would recommend looking at Capital One’s Quicksilver card. I used to LOVE my Amex card, but actually dropped them for the Quicksilver. I know Capital One used to have abysmal customer service, but they have made huge improvements in recent years. I have had good experiences with their customer service the few times I’ve needed to contact them, and I love their wallet app that sends a notification every time a charge hits the card, which allows me to quickly see if there are charges I don’t recognize. (In the interest of full disclosure, I previously worked at Capital One in corporate functions. My opinion of the Quicksilver card is based on my personal experience with the card).

    • I said the same thing above! I don’t know why people use debits for anything but cash!

      Also, I recommend Chase’s Sapphire Rewards card too. They have EXCELLENT customer service. They know my shopping habits and alerted me instantaneously when my card was used erroneously (I think my card got copied by an employee at a restaurant that week) via a text message on my phone and the fraudulent charge couldn’t even get posted to my card because they notified me quickly enough to confirm I didn’t make the charge.

      And even though it has a fee, the rewards make it worth keeping every year. And the easy access to a live person makes the card totally worth while.

      • Most credit card companies alert you when something odd appears. I’ve had AMEX and other Visa card vendors do that.

        Note the complaints about Citigroup’s card where people were suddenly cut off when they were on European trips — AFTER they had informed the company where they were going.

        I don’t know…I object to having to pay a fee for the privilege of buying things. There, too: comes the time when you can’t get a credit card without a fee, that’s when I start paying with cash and checks again.

    • Yeah, I have to agree: I really REALLEEEE don’t like the prospect of having to buy my gasoline with a debit card. I don’t like using debit cards at all, but got one from the credit union because I figured that was how I was going to have to do business with Costco.

      I hate writing checks, but I guess that’s what I’m going to go back to. Truth to tell, I don’t want another credit card to have to pay, either. I used the AMEX card for everything because it was ONE bill to have to dork around with. I’m thinking keep the new AMEX cards, pay at Costco with checks and buy cash cards for their gas, or else stop shopping at Costco.

      The amount one would save by shopping somewhere other than Impulse Buy Heaven would pay for the extra cost of buying gasoline at other stations.

  4. I guess I’m lucky – I’ve never had any issues with my citigroup card. I don’t have a Costco branded citi card, but for the odd time I buy something at Costco, I am happy to be able to use my Visa, rather than having to use a debit card.