Costco Recalls Gift Cards Following Bankruptcy Filing by Third-Party Issuer
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Warehouse club Costco is issuing a recall for specific gift cards sold at its locations nationwide.
The retailer announced in a letter to its members that customers who purchased Synergy restaurant gift cards between October 27, 2025, and January 26, 2026, are eligible for a refund for any remaining balance on the cards.
This recall follows the abrupt shutdown of Synergy World, a gift and loyalty card company, which filed for Chapter 7 bankruptcy protection last month. Consequently, the gift cards can no longer be redeemed, leaving many consumers with unusable balances and limited options for recourse.
SOME GIFT CARDS SOLD AT COSTCO ARE NOW WORTHLESS
Synergy World filed for Chapter 7 bankruptcy protection in late January. (Angus Mordant/Bloomberg via Getty Images)
It is important to note that Synergy’s gift cards were third-party products. Although they were sold at Costco and redeemable at numerous participating restaurants across the country, the cards were issued and managed by Synergy, not Costco or the restaurants themselves.
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With Synergy’s closure, the gift cards effectively became worthless. Matt Schulz, LendingTree’s chief consumer finance analyst, emphasized the importance of using gift cards promptly. “One of the biggest lessons that people should learn from this is that gift cards should be used sooner rather than later,” he told FOX Business. “That’s especially true if the company involved is on shaky footing. However, with any gift card, you’re better off not letting it gather dust. Otherwise, you risk losing it, forgetting about it, or just having it lose value. That’s the last thing anyone needs today.”
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Initially, Synergy indicated that gift cards would be honored through early February but later ceased redemptions entirely, citing a surge in demand. The total amount of money tied up in unredeemed cards will not be disclosed until bankruptcy filings are made public.
The gift cards were sold by Costco but issued by Synergy World. (Lindsey Nicholson/UCG/Universal Images Group)
Expert tips when it comes to gift cards
Schulz recommends that consumers keep the receipt for their gift cards until they have been fully used. This practice can simplify the refund process if needed. He also advises registering the gift card whenever possible, as this can assist in case the card is lost. Additionally, using a credit card to purchase gift cards can provide added protection against potential fraudulent activity.
Check out what’s clicking on FoxBusiness.com.
Warehouse club Costco is issuing a recall for specific gift cards sold at its locations nationwide.
The retailer announced in a letter to its members that customers who purchased Synergy restaurant gift cards between October 27, 2025, and January 26, 2026, are eligible for a refund for any remaining balance on the cards.
This recall follows the abrupt shutdown of Synergy World, a gift and loyalty card company, which filed for Chapter 7 bankruptcy protection last month. Consequently, the gift cards can no longer be redeemed, leaving many consumers with unusable balances and limited options for recourse.
SOME GIFT CARDS SOLD AT COSTCO ARE NOW WORTHLESS
Synergy World filed for Chapter 7 bankruptcy protection in late January. (Angus Mordant/Bloomberg via Getty Images)
It is important to note that Synergy’s gift cards were third-party products. Although they were sold at Costco and redeemable at numerous participating restaurants across the country, the cards were issued and managed by Synergy, not Costco or the restaurants themselves.
SALMON SOLD AT BJ’S WHOLESALE CLUB RECALLED OVER POTENTIAL LISTERIA CONTAMINATION
With Synergy’s closure, the gift cards effectively became worthless. Matt Schulz, LendingTree’s chief consumer finance analyst, emphasized the importance of using gift cards promptly. “One of the biggest lessons that people should learn from this is that gift cards should be used sooner rather than later,” he told FOX Business. “That’s especially true if the company involved is on shaky footing. However, with any gift card, you’re better off not letting it gather dust. Otherwise, you risk losing it, forgetting about it, or just having it lose value. That’s the last thing anyone needs today.”
GET FOX BUSINESS ON THE GO BY CLICKING HERE
Initially, Synergy indicated that gift cards would be honored through early February but later ceased redemptions entirely, citing a surge in demand. The total amount of money tied up in unredeemed cards will not be disclosed until bankruptcy filings are made public.
The gift cards were sold by Costco but issued by Synergy World. (Lindsey Nicholson/UCG/Universal Images Group)
Expert tips when it comes to gift cards
Schulz recommends that consumers keep the receipt for their gift cards until they have been fully used. This practice can simplify the refund process if needed. He also advises registering the gift card whenever possible, as this can assist in case the card is lost. Additionally, using a credit card to purchase gift cards can provide added protection against potential fraudulent activity.
