Getting Screwed by PayPal

by silic0nesilence (2600@silic0nesilence.com

If you've used eBay, then it's almost likely that you've used PayPal.  If you're a seller on eBay, PayPal is critical to your success.  Being a college student, months ago I needed some extra cash.  My mother told me that if I sold her notebook on eBay, she would give me a cut of the money.  Being desperate, I agreed.  I carefully inspected the notebook to make sure all the specs I posted were accurate.

A week later, the laptop had been sold for $615.  After I received the payment, I transferred the money to my bank account and then shipped the laptop via UPS with free insurance.  A few days later, the buyer sent me an eBay personal message.  He told me how happy he was and that he wanted to know if I had any more.  I responded with, "You're welcome, but I'm sorry, I have no more."  A few days went by.  I then got an email that the buyer was disputing the purchase and my PayPal account had been frozen.

I contacted PayPal wondering what was going on.  The PayPal employee that helped me told me that the buyer was disputing the purchase through his credit card company because the item was not as described.  I figured I was in the right.  How could I go wrong?

A week later my balance was -$625.  (The extra $10 was a fee PayPal took because of the dispute.)  PayPal sent me an email telling me that the credit card company refunded my buyer's card, so PayPal had to refund the credit card company, thus leaving my balance negative in a large sum of money.

So this really sucked.  Not only was I out $625, but I didn't even have the laptop.  An obvious scam, but PayPal didn't see it this way.  They didn't ask to make arrangements to get the notebook returned, and when asked they said it was out of their hands.  They told me if I gave them the tracking number, it would help my case.  When I sent it to them, they responded saying that the tracking number was invalid.  Two minutes later they sent another email saying that it was valid but the charge-back was over the item not being as described.  Incompetence.  Why did they ask me to send it?!

So here I am, stuck in this nightmare of Internet fraud.  If PayPal were a moral company, they would see this as some sort of scam, seek inspection of the laptop, or keep in mind that I had a "no return" policy.  I was beginning to freak out.  I'm 19 and I have no money.  No attorney would probably take me seriously and PayPal is telling me they will seek legal action if the funds are not returned.

Off to Google I went.  I found out there are hundreds of people who have had my problem, and even websites dedicated to exploiting PayPal.

paypalwarning.com and paypalsucks.com contain thousands of stories about PayPal, most looking exactly like mine.  Stories of frozen accounts and charge-backs that occur years after the transaction!  To avoid headaches, I would recommend staying away from PayPal completely, although I don't see many people taking that advice.  Keep these two things in mind:

1.)  Reading PayPal's Terms of Service (TOS), you waive your rights to credit card consumer protection laws if you want to use their service, and that you may not issue a charge-back for unauthorized use of your credit card and PayPal account, or if you do, then they have the right to limit your account.

2.)  PayPal's security is absolutely disgusting.  There are hundreds of PayPal phishing and spoof sites.  Should you fall victim, PayPal will hold you responsible not matter what.  Reading the section of the TOS that tells you they can close your account for any reason, you will have to wait 180 days after the account is closed to get any money that is yours.

3.)  Customer service is horrible.  When I asked to contact someone, they sent me an address.  I then replied to the email telling them I didn't have time to send a letter and that I needed a phone number.  They replied telling me they did not have a phone number but offered a fax number.  A company as large as PayPal and eBay and not one telephone number.  Odd.

PayPal is still contacting me about how I must add funds or they will seek legal action.  I may be out $625 and a laptop.  I'm pissed-off and broke.  After reading this, and the other horror stories online, I hope people will learn from my (and other people's) mistakes.

If you choose to use PayPal, watch your back, because they will stab it in an instant.

Shouts: Baby Girl, Roxas.