Paypal is holding me hostage because I got scammed, need advice

DeutscherGeist

Here is the story:

I buy item from ebay and pay via paypal. Item was received, but not as described. Since Paypal only covers items not received and does not care about condition, I filed a chargeback with my credit card company--they helped me get my money.
Now paypal did not like it that I went over their heads and froze my account until I pay them the money that was charged back. I can't show proof of returning item because the scam seller changes his username and cannot get an updated address from anyone. I'm stuck. This item was just a little over $100, which for me is a high amount considering what I make and normally spend. Its been almost a year.

Is there a time limit until they give up? Should I wait out the year. Can I open a new Paypal account with a different email address and visa? What course of action should I take?

2323

I'm not being sarcastic, but seriously, why would you even want to use paypal anymore? I never use paypal. The way they treat people, why give them your money, they don't care about you one little bit. Send money orders!

CON40

deutsche;

Same exact thing happened to me with an $800 item (thank god for Amex! Paypal would do nothing). They froze my account. I didn't care until I received a refund from ebay on another scam and the only way they refund is through Paypal. Now I have $175 of MY money that they are holding hostage until I do one of two things: Payback the $800 or return the fraudulent item. I cannot return the item becuase it was sent from a Mail Boxes store.

Long story short, I called Paypal on this (go to paypalsucks.com where 800 numbers are posted) and actually spoke to a real person. Given this catch 22, they are reviewing policy to lift my access privileges so I can get my money. You can do this too, just make sure you have the original item and original shipping package as proof you would like to return the item (and not keep ) but that you are unable to return it.

Ironcially, Paypal has an address for the iundividual who scammed you if they are verified users. But due to privacy policies, they'll never divulge it to you even in a case like this!

Bottom line, get in, get out (your money) and close your account. Use checks and money orders!

acowa

Story on paypal getting fined $150,000 for business practices

Stone193

<< <i>Use checks and money orders! >>


Using this method of payment is fine with me in general, but doesn't it leave you vulnerable with no recourse vs. using credit cards where you at least have the chance to dispute a transaction and possibly get your money back from a scammer?
Mike

felix76

If you send checks, your bank should help you with any problems. It is also easier to keep up with a check that has been cashed. If you send money orders, always send Postal M.O.'s. The Post Office has some very strict rules against fraud and they are willing to help.

helionaut

Yes, you can dispute anything except cash. In our webhosting business, we once had a guy dispute a check that he had written, saying he was on painkillers or something when he wrote it, and he really meant to cancel the service 3 months before instead of paying his bill, so we should refund his money for the 3 months of service we had already rendered him. His bank tied up the money for a little while until they realized it was not only ridiculous, but you can't repossess 3 months of webhosting.

phreakydancin

Yes, you can open a new Paypal account, but you'll need to use a new address and credit card. And note that the billing address on the credit card must match, so you may need to do a change of address with your credit card company first.

Snowball

I was scammed before. I paid by money order. I filed a fraud complaint to ebay after 2 months got my money back less $25 ebay fees. Ebay sent it through my Paypal account which I didn't like.


DG,

I called Paypal several times asking questions. Paypal only covers item not received. If items is not as described (or if seller sent you an empty package) they told me to file a complaint to ebay. If found you are entiltle to a refund, ebay return your $$ you less shipping and $25 ebay processing fee. Paypal doesn't like you going to your Credit Card company because they will lose money.

DeutscherGeist

Thanks for all the input thus far guys!

The way things are in my situation, I have not lost anything yet, but my paypal account is frozen, so I can't use it anymore. They can keep it frozen for all I care, since I am happy that my credit card refunded my money. Will Paypal hold my frozen status forever? Is there a time limit? I guess as long as I just use personal checks, I can continue with my ebay shopping, so maybe I can just ignore my Paypal status. I mean its not going to get worse, right? They are not going to sue me for a $100 right? They will not cancel my account either unless I pay the balance. Do I need to worry about having an open frozen account?
I have no problems using checks. Actually, the item I am bidding on now is from a 100% feedback seller, so I am confident that I have nothing to worry about.

I did read the $150,000 lawsuit against Paypal, and it was rightfully done.

DeutscherGeist

Con40,

I am glad you replied to my post. I was actually going to PM you about the issue since you did post on a previous thread that you had the same problem as I.

I guess I should just call paypal and tell them that this issue is almost a year old and I need an updated address so that I don't send the item to the wrong place. I still have the item and the original packaging box. If they don't give me an address where I can send the item back, then what am I suppose to do? Will Paypal take it? I doubt that.

So, what you are saying is that as long as I talk to them, they may just restore my account since they cannot give out addresses---even though I have a justified claim for it? I have no money tied up with them right now. You think they will let me off just by my intent alone?

Let me ask you this: Didn't AMEX require proof of returning item? The merchant has one year to dispute the chargeback. If the merchant disputes the claim, then AMEX will have to ask you for return shipping proof.

I am just curious about all this since I want to know as much as possible about paypal and credit card issues so that I can make the best decisions.

Thanks

MrRookie

another day, another story about paypal screwing an honest, innocent person......

Snowball

DG,

Did you try to email the seller about the item? If you did and seller won't respond maybe you can tell paypal about it. Might help. When returning the item put a tracking and insurance.

Buckwheat

DG,

I understand that you were sold goods that weren't as described. What I don't understand is why you believe that paypal has to be responsible to you.

Paypal is a great way to transfer money. But they shoouldn't be put in the position of "arbiter" and responsible for the seller's or the buyer's bad faith. Your issue should be with the seller, not with paypal. If I was paypal, I too would freeze your account. They have clearly stated rules that say that they only cover for non delivery, and not for items that don't meet expectations. If you are not willling to accept their rules, then you shouldn't expect to use their service.

Why didn't you send the item back immediately on receipt and ask for a refund from the seller?

I am not trying to sound harsh, but the reality is that all of the complaints about paypal revolve around dishonest sellers and buyers. No one seems to ever complain tht paypal screws up, just that they won't make good on someone else's scam.

Paypal should start another company that doesn't allow buyers to use credit cards. Without the 2% credit card charges to paypal, they could perform their service of transferring money electronically much cheaper, and could charge a much lower fee.

Mantlefan

Agree that PAYPAL is a pain. I'm involved in a dispute with them now. I got an empty sealed package from a seller in Sweden. The scammer refuses to refund my money. PAYPAL's buyer protection doesn't cover international transactions. It looks like I'll have to involve AMEX to get my funds back which will probably lead to my PP account being frozen.

DeutscherGeist

MantleFan,

You can almost count on your account being frozen, but don't let that stop you from going to AMEX.

DeutscherGeist

Buckwheat,

you don't know all the facts of my case. I did contact the seller, but I never got a response. He probably has changed email address and certainly his ebay name. My email and ebay ID are the same and HE never contacted me either. My credit card company does not even know the address, so they cannot help even if they wanted. My credit card company gave me the refund after investigation, which took a long time. They told me to stay put with the item till they are sure they can credit the funds. What else am I suppose to do? Now its been such a long time and the seller never EVER responded to any of my emails, not back then and not now. I want to send him the item, but where? If I send it to the old address, who knows who would get it (i would insure it and track it, but I still need a correct address).

I am not holding PAYPAL responsible, this was something b/t me and my VISA company. Now PAYPAL is meddling. They should just give me the address and be done with it. Is that so much too ask? If they don't want to give me the address, then they should unfreeze my account. Quid pro quo.

You talk about PAYPAL guidelines: I followed it!! They stated (you can look it up yourself) that they will cover items never shipped out, but that we must go ahead and contact our credit card company if the issue is with goods not as described. THAT IS WHAT I DID. Why don't you get it?


BuckWheat, your post was harsh and ignored some essential facts. I came on hear for advice in resolving the issue. I agree that PAYPAL is great if the seller or buyer does not try to commit fraud or any dishonest action.

packCollector

does anyone know whem they decide to freeze your account? I say this because on 2 occasions I went over them through my credit card swhen they did nothing for large amounts, once for 2500 and once for 11k which I am pretty sure the seller never gave the money back.

DeutscherGeist

Pack collector,

thanks for sharing! So, you did this twice w/o having your account frozen? Luck! My account was frozen within several months. It was not done immediately. When they did freeze my account, I was shocked because I had been using it and thought everthing was fine. Mine was over a small amount. Your amounts are much much larger. I wish you the best, but I think they may just as well freeze your account in the future.

Make sure you do not sell anything via PAYPAL. Once they freeze your account, you cannot recover funds due to you for selling. Keep on buying for as long as you can, but only accept checks, MO or cashiers checks for item you sell. You may be in the clear, but you can't be too sure. How long has it been since your chargeback?

packCollector

the 2500 was well over a year. I think december 02, the 11k was last summer, which was actually broken up through 2 paypal accounts

Buckwheat

DG- Did you go through the Ebay complaint process? They are usually good at giving you contact info.

I would assume that your info is frozen because they didn't get the money from the seller either.

Picture the scenario here, and let me know if my facts are wrong. If they had a chargeback from the credit card company, but can't collect from the seller, this sets up an obvious scam that could be used to rip off paypal. Scammers could team up, with the seller collecting money from the sender, and then disappearing from paypal. Now the buyer does a credit card charge back, as you have, and paypal is out, with the two scammers making off with the money. Why couldn't this be repeated over and over?

I didn't mean to sound harsh, but don't you realize that in your situation, paypal is the one out the dough, and they didn't do anything wrong? And you are mad at them. I agree that they should supply you the address, but do they even have it? Was there a return address on the package?

packCollector

Buckwheat, I agree your scenario presents a problem for paypal. if paypal was losing a ton of money like this then they should changetheir business model and act more like an escrow service.

in my cases both sellers had over 500 paypal transactions and valid contact information. if paypal has the contactinformation then I believe it is there responsibility to deal with the chargebacks. what else are we giving them 3% for. I think I spent about 70k through paypal last year. that's over 2 grand they skimmed off the top. I probably received another 30k , thats another 1000 they skimmed. for all the money they are skimming and since they allow credit cards which is the main driver of their business, they need to take part in retrieving lost funds. they have the contact info but won't give it out, they have the bank info where the money is withdrawn to but won't give it out, therefore the responsibility must lie on them otherwise they are basically a channel for illegal activities. we will allow people to steal your money then we will hide their idenities.

also, I am not sure how legal it is for paypal to hold you responsible on a credit card transaction when the credit card company is giving you protection and then paypal is taking it back to protect the scammers. do the legal experts here have any insight?

why else would you use paypal, you would be much better protected with a postal money order.

DaBigHurt

<< <i>

Picture the scenario here, and let me know if my facts are wrong. If they had a chargeback from the credit card company, but can't collect from the seller, this sets up an obvious scam that could be used to rip off paypal. Scammers could team up, with the seller collecting money from the sender, and then disappearing from paypal. Now the buyer does a credit card charge back, as you have, and paypal is out, with the two scammers making off with the money. Why couldn't this be repeated over and over? >>






A customer who is a victim of fraud will ALWAYS dispute those charges if they paid via their credit card. If Paypal is so worried about people scamming them via fraudulent credit card chargebacks, they should consider terminating the ability for people to pay via their credit cards altogether. Of course we know this will never happen given how lucrative credit card purchases are to paypal. Perhaps if you are ever unfortunate enough to get scammed out of your hard earned cash via paypal by a ripoff artist, you'll be noble enough to 'take it like a man' and not seek the protection your own credit card company affords to you.

DeutscherGeist

PackCollector, you said it better than I can! Nice post!

I am happy that you were able to protect yourself with those two incidents, but I worry your account might be frozen in the near future. I don't wish it on you, but if the latest incident was last summer, that may still haunt you (I hope not). I have no idea how they handle determining freezing accounts. It looks like you are free and I hope it stays that way.


In my case, I find it so strange that the seller never ever contacted me. Then again, scam artists don't use the logic we do. I never tried going through ebay, initially, to settle this problem mainly because they have not helped my friends with their similar problems in the past, so I didn't feel they had power over the situation, and I couldn't let the 30 days run out messing around trying things my friends and associates have said were unsuccessful. I contacted the seller and when that didn't work, I went directly to my credit card company for help. I told them that there are other avenues, but I couldn't risk wasting time. They understood this and helped me. I have successfully received help from Chase Visa many many times, so I simply went to the place where I know I can get things done. I am not a big time buyer, so with the knowledge I had at the time, this was the best way I knew how to proceed. I can't hire a lawyer for every problem that comes up. If I mishandled this situation or if there was a better way to handle it, so be it, I just sincerely tried my best to fix the problem based on what was available to me. The key to this problem is simple, someone needs to provide me with the correct address, then I can prove that I shipped it. The problem would then be solved. Paypal won't give the address, so I shouldn't be the one to blame. I am trying. What I won't do is simply give up the money without rhyme or reason.

packCollector

here is some info that I think may be helpful to all and would like any info if the legal guys know anymore

I just read through the paypal user agreement extensively. I can not find anything that says that paypal has the rright to hold the buyer responsible for chargebacks if funds can not be collected from the seller. it does say that they can freeze your account or limit access to your account for the funds in question. It does not say that they can keep your money to cover paypal. It states that you have credit card dispute rights (chargebacks) which can protect you if the paypal complaint process does not solve the problem.

That said , if you do have credit card rights, then once the investigation is complete and if they find for the buyer ,I would assume that they must release any funds they are holding. It states that if your account access is limited or your account is closed then they will send funds in the form of a check.

I have never been in this situation but i can't see how paypal could hold a buyere responsible on a case that is found in favor of the buyer like in DG's case. DG i would recommend you call them and ask them how long they are going to put a hold on your money .

1 other note , as of February 14, 2004 , paypal will accept disputes over not as described items. They immediately put a hold on the sellers funds if there is a dispute. This is a much harsher policy than ebay since they assume the seller is guilty and hold there money for description disputes. just another thing to keep in mind when accepting payments from buyers you are not familiar with and the amount of the payments you are willing to receive.

CON40

pack;

That's welcome news that Paypal has changed its policy in regard to "not as described" items. I bet this is the most common scam running that involves eBay/Paypal. It falls into a very gray area of he said/she said. Who is Paypal to trust? The buyer or the seller? It seems like they may finally be coming around on simple common sense. They should trust the buyer because the scam is much harder to perpetrate from that end. You must buy an item, pay by Paypal, switch the item upon arrival, then dispute the item, demand a refund, etc. Bottom line is you have to pony up the cash to steal the goods. The seller simply has to slip a piece of cr@p in the mail and wait for the dough.

Also, they run a bit of a fiefdom. You must abide by their investigation to get your money back. A credit card company or bank investigation is not valid in their world. A bit crazy as I think American Express has a much more resolved fraud division that Paypal would ever have. But, in their CYA world, this is what they practice:

PayPal's User Agreement outlines the policy for our internal Buyer Protection Program, which we provide to internally resolve disputes between buyers and sellers. When you choose to use an external chargeback program instead, we will honor a chargeback that our investigation determines is valid. However, as per the User Agreement, we reserve the right to permanently limit your account access.

Why do I know this? I got taken for over $850 last year. Paypal could not find in my favor as the result of an "investigation". SquareTrade and eBay were equally worthless. But Amex came to my rescue and issued a chargeback that Paypal had to eat. They didn't like that and suspended me (though they have held $175 in cash hostage since). I don't feel bad for Paypal. They need to police their users (abusers?) more stringently, or they'll be in serious financial trouble. If they l;ose enough money because people are relying on their banks to save them from being scammed. Paypal gives these crooks access to an honest pool of victims. They have culpability here and they know it.

packCollector

Con , I would call them and question them on your $175 . they have no legal right to keep your money at least from what I read according to there user agreement. It states that you have access to using the protections from your credit card. if you call, let us know what you find out

CON40

pack;

I did call! They suspended me because I did not A) refund the chargeback (Yeahh!!), or return the merchandise and provide proof of the return to Paypal.

The scammer shipped from a Mail Boxes store. I had no further contact from them (obviously), so I had no address to return the item too. I asked Paypal to furnish the address for the seller (err, scammer?) they had on file. They refused due to privacy reasons. I have not been able to withdraw the money, use it toward a purchase, or close the account and receive a disbursement. Believe me, I have tried!

I called and pointed out this vicious cycle I am trapped in. Surprisingly, they were supportive! They requested I send the item to Paypal. I sent it along in the original packaging so they could see how I received it. I am waiting to hear back. They say they will lift the suspension due to my "unique" situation.

Unique? How many scammers give valid return addresses? Paypal must be dealing with dozens of cases like mine every day! This is probably why they are changing their user agreement.

DeutscherGeist

Pack,

Thanks for the informative post!!

I will call PAYPAL and ask how long they will keep me frozen. I will collect information and see where I stand. To my defense, I had to by pass their dispute resolution because they didn't cover the type of dispute I had at the time. They admit that they don't cover not as described items, so why go through them in the first place and waste all that time and jepordize my chances with reporting the incident to my credit card company? This is between me and my credit card company.

They finally changed their policy---good for them. My case was way before the new policy, so they can't hold that against me. Out of the many transactions I had with PAYPAL, having one strange one shouldn't ban me.

I will post an update soon!

YAYAIMHIPIMHIP

DeutsherGeit....HMMM,the question you may/should ask paypal is if they don't cover a received dissimiliar item then what phuquen business do they have getting involved with your or any other insurance policy(credit card policy) you have to guard your money.Seems they are in a conflict of interest regarding their own coverage policies.I would definitely question their legal statue regarding this matter.They are strongarming you over an issue that they themselves disclaim.I'd think and research on how to file suit against paypal for illegally holding your money without just cause.If receiving a dissimiliar isn't their cup of tea then why would it concern them if card was returned or not.And if they are to be deemed to ensure card returned then they have the obligation to see that both parties have the proper information to complete the reversal.Paypal would have a log of the transaction with both parties info in it and either party should have the right to that info without vilolating the privacy act..Once proven contact can't be made using their info because one party had a sex change,it should then fall into paypal's hands to either provide an updated status on the second party in question.If unable due to that,person not updating their own personal info to paypal and if paypal can't supply current info needed by other means then both the second party and paypal themselves are in default > no grounds to freeze your acct.
***Now,if the other party filed with paypal on not receiving card back after you got your money back;then yes they can/will freeze you.But this then means proper info exist to ship card to the filing party.Don't they have to inform you that someone(with their ID and claim of charge) has filed against you and your acct will be 'held' until card returned.They have to provide oppurtunity for willful restitution before they do an all-out JACK of your acct.(don't sound like this is the case)
Personally,don't see how paypal has any jurisdiction over this matter IN THIS YOUR PARTICULAR SCENARIO! I'd start with too many players on the field, illegal proceedure against paypal,illegal use of hands to your acct and follow it up with unsportsmanlike conduct due to an intentional piling on hit that can be considered defamation of character.OH,and the pain and suffering this all has caused you.
I would be curious how they responded to being filed suit against.They get away with these things only because one allows them to get away with it.Burdon of proof would fall on them to prove you never sent the card back,meaning they would have to contact and verify with other party involved this is indeed the case.And if they can't reach him to do this then what can they hold you acctountable for?Can't have a murder trial without a dead body can you?
My personal recoarse using paypal is to keep less than $50 in acct if need be and put the rest in my back pocket.Just IMMHO.I am curious how this will play out for you though.The best of Luck to you!!!

Jeff

YAYAIMHIPIMHIP

Buckwheat...very insightful point on the tag team scam scenario against paypal.

Packcollector....Awesome reporting!!Very informative and intelligently stated.I like what I learned from this thread so far!
Correct me if I'm wrong,but I think we kinda missed the bigger picture here.Not receiving item as described is FRAUD on the other parties part.File complaint with ebay.If ebay is in your favor then doesn't it seem likely ebay has the clout to spank paypal and put them in check??After all Who owns Whom?

Treetop

Hey Guys, I agree that everytime I hear the word “paypal” I get that funny uneasy feeling in my gut, but I would like to share a very positive situation I had with paypal as a buyer.


Late last year I bought a 1960 Topps Football set off ebay that was described as near-mint. When I received the cards they were nothing close to near-mint and most the high $$$ star cards had 1/8” to ¼” tears in the right side border. I contacted the seller and he said that he would refund only 80 percent of the purchase price and then he started to say that I probably switched all the cards and he would have to confirm that the cards were that same upon receipt before he issued a refund. Well, that didn’t sit well with me so I contacted paypal and explained I received the set “not as described”. Paypal said show the set to a National Dealer (Paypal never did define what a National Dealer was) and get a letter stating that the cards were not near-mint and had small tears in them. So I took them to a dealer I knew and he produced a letter stating what I had already explained to paypal and I faxed the letter to paypal and they said send the cards back to the seller with delivery confirmation and once the set was confirmed received, they would refund my money.

Not even 24 hours after the set was confirmed received to the seller, Paypal credited my account the full $565.00.