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A chilling PayPal story
iras4
Posts: 300
This is a true account..it just happened to me.
On Nov. 2, 2005, a bidder used BIN now to purchase a 1909 S VDB 1c PCGS MS-65 RD. I sent it to his address via Registered Mail. He signed for it on Nov. 10 and left me favorable feedback on Nov. 12. So far so good.
On March 21, 2006 I got a chargeback for the full amount ($6112.00). Buyer stated that it was an unauthorized charge.
Sent an e-mail to buyer...no response. PayPal said they were investigating. Sent PayPal copies of the auction, copy of the positive feedback, a copy of the Registered Mail receipt and a copy of the USPS page showing confirmed delivery.
Fast foward a bit. I contacted the police in buyer's small Alabama town and an investgator hauled him in. Called me back with buyer in tow. Buyer stated that he did indeed get coin and was hoping to resell it on eBay for a profit. Didn't succeed (20 feedback score) so he consigned to a dealer in Birmingham who told him he sold it at a huge loss and gives him $3500, which buyer spent. He doesn't pay one cent towrads his credit catd bill (Amex) in over 3 months. Amex suggested he file a chargeback for unauthorized use of his credit card which he can simply do over the phone. He does that, PayPal pulls the $$ from my account and tells me they always try to go to bat for their sellers.
Meanwhile, buyer, now frightened of possible pending charges of mail and wire fraud, contacts Amex says he wants to reverse the chargeback. Amex tells him no dice. He wirites to PayPal & says it was all a mistake and asks them to release funds. Paypal stated they will contact Amex. After 35 days, PayPal writes me that they do not feel they can successfully dispute the chargeback and the case is closed. I'm out the funds! No appeal..read PayPal rules they say.
They DID tell me at the start of this saga that I shouldn't be surprised if they are not able to reverse the chargeback. Under PayPal's agreement with credit card companies, only the CC companies can have the final say. Seems Amex felt they could have the money from me and not worry about fighting for funds from buyer. PayPal is the credit card companies' safety net it seems!
Monday I'm going to ask PayPal for the New York State registered agent of service so I can serve him notice of a pending lawsuit. To add insult to injury, PayPal took an additional $142 from me as a transaction and investigatory expense when credit card company refused to rescind the chargeback order.
Other details: A signed & dated letter from the buyer that he made a mistake and that he intends to contact PayPal and Amex to get the chargeback cancelled. This was ignored by PayPal and Amex even though PayPal notified me by e-mail stated the buyer wished to cancel the chargeback and had contacted them. Seems the CC company had no intention ever of relinquishing the funds that belonged to me.
Subsequently, buyer sent me $1800 as all he could pay. These were good funds in the form of postal money orders. I guess I was lucky to get that.
Ira
On Nov. 2, 2005, a bidder used BIN now to purchase a 1909 S VDB 1c PCGS MS-65 RD. I sent it to his address via Registered Mail. He signed for it on Nov. 10 and left me favorable feedback on Nov. 12. So far so good.
On March 21, 2006 I got a chargeback for the full amount ($6112.00). Buyer stated that it was an unauthorized charge.
Sent an e-mail to buyer...no response. PayPal said they were investigating. Sent PayPal copies of the auction, copy of the positive feedback, a copy of the Registered Mail receipt and a copy of the USPS page showing confirmed delivery.
Fast foward a bit. I contacted the police in buyer's small Alabama town and an investgator hauled him in. Called me back with buyer in tow. Buyer stated that he did indeed get coin and was hoping to resell it on eBay for a profit. Didn't succeed (20 feedback score) so he consigned to a dealer in Birmingham who told him he sold it at a huge loss and gives him $3500, which buyer spent. He doesn't pay one cent towrads his credit catd bill (Amex) in over 3 months. Amex suggested he file a chargeback for unauthorized use of his credit card which he can simply do over the phone. He does that, PayPal pulls the $$ from my account and tells me they always try to go to bat for their sellers.
Meanwhile, buyer, now frightened of possible pending charges of mail and wire fraud, contacts Amex says he wants to reverse the chargeback. Amex tells him no dice. He wirites to PayPal & says it was all a mistake and asks them to release funds. Paypal stated they will contact Amex. After 35 days, PayPal writes me that they do not feel they can successfully dispute the chargeback and the case is closed. I'm out the funds! No appeal..read PayPal rules they say.
They DID tell me at the start of this saga that I shouldn't be surprised if they are not able to reverse the chargeback. Under PayPal's agreement with credit card companies, only the CC companies can have the final say. Seems Amex felt they could have the money from me and not worry about fighting for funds from buyer. PayPal is the credit card companies' safety net it seems!
Monday I'm going to ask PayPal for the New York State registered agent of service so I can serve him notice of a pending lawsuit. To add insult to injury, PayPal took an additional $142 from me as a transaction and investigatory expense when credit card company refused to rescind the chargeback order.
Other details: A signed & dated letter from the buyer that he made a mistake and that he intends to contact PayPal and Amex to get the chargeback cancelled. This was ignored by PayPal and Amex even though PayPal notified me by e-mail stated the buyer wished to cancel the chargeback and had contacted them. Seems the CC company had no intention ever of relinquishing the funds that belonged to me.
Subsequently, buyer sent me $1800 as all he could pay. These were good funds in the form of postal money orders. I guess I was lucky to get that.
Ira
Dealer/old-time collector
0
Comments
I don't buy the guys story about giving it to another and then losing money selling it on commision it sounds.
Sounds like the guy is a deadbeat to start with and has scammed you. Giving you a little money back to sort of smooth things over.
I think you ought to press charges and get his ass thrown in jail.
If I only had a dollar for every VAM I have...err...nevermind...I do!!
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For $6k I would be suing someone, writing to a congressman, FTC, etc.
<< <i>Amex suggested he file a chargeback for unauthorized use of his credit card >>
I've a hunch that the buyer is lying about that part. I have a hard time believing that Amex would suggest he engage in fraud.
Russ, NCNE
Perhaps you can go after the credit card company for suggesting that the client "file a chargeback for unauthorized use of his credit card " when such was not the case. In other words, if the client didn't lie to the credit card company, it seems that they were encouraging fraud by recommending the charge-back.
Edited to add: I see that Russ had a similar thought.
I understand Bank of America, the issuer (correct term??) of 40% of credit cards in the US, is considering launching their own credit card line (like MC, AMEX). If they could add a feature allowing a direct payment type service like Paypal, that would take off!
<< <i>Damn, that bites...
I don't buy the guys story about giving it to another and then losing money selling it on commision it sounds.
Sounds like the guy is a deadbeat to start with and has scammed you. Giving you a little money back to sort of smooth things over.
I think you ought to press charges and get his ass thrown in jail.
Unfortunately, by my accepting ANY money from buyer (I didn't know this at the time) I relinquished my ability to have criminal charges pressed. My only choice is county court as it's too large an amount for Small Claims. Laywers in that area want a $5000 retainer! In all likelihood, the best result would be a judgement against the buyer and in that jurisdiction, court costs are not recoverable. Wouldn't pay to do that. My best shot is PayPal. That will cost me big, big bucks. We'll see what happens afer a subpeona is served to the PayPal agent in my state.
I'm like a bull dog in such matters.
Ira
BTW, I think you have to sue PayPal in California. It's in their TOS.
<< <i>Welcome to the nightmare of credit card fraud. >>
Thanks for saying that. I'm sure people will be quick to blame PayPal, Amex, eBay, whomever -- when the real culprit is the nutjob who stiffed you.
I'm sure you could get the balance in small claims -- no need for a lawyer. But it'll be blood from a stone nonetheless -- I doubt the guy has the money. Every business runs into these criminals now and again -- sadly, it's just a cost of doing business.
Lou
ANA Life-Member
I just learned a very good leason though. I will not take PayPal over a certain dollar amount in the future. Risks are just too high.
Either that and/or not sell to ebayers with less than 100-200 feedbacks.
I'm sorry for your lose and hope your are able to recoup more of your money back than you have so far.
Edited to add: What's also sick is the lowball selling price the guy accepted for the coin after the sale from you.
peacockcoins
your chances of being successful against AMEX are two - slim and none. Even if Amex "suggested" the chargeback, it would be their contention that they assumed the buyer was returning the goods or in this case the coin.
their liability here is zip.
What about the dealer to whom he consigned the coin? Shouldn't that dealer's sale be null and void as he sold stolen property, in which case he could be on the hook for it if he can't get the coin back from his buyer?
Here's yet another extreme horror story example of why.
<< <i>There's currently a thread going on about why some sellers don't choose to offer PayPal in their auctions. Here's yet another extreme horror story example of why. >>
A quick check here on this forum too with the keyword, Paypal will reveal pages of threads dealing with Paypal- the majority of them negative.
Now, can you suppose why that is?
peacockcoins
<< <i>There's currently a thread going on about why some sellers don't choose to offer PayPal in their auctions.
Here's yet another extreme horror story example of why. >>
Credit cards are chargebacked. Checks bounce. Money orders are forged. No matter how one gets paid, there is always the chance of getting screwed. Don't blame the middleman. Ira's "customer" is a flat out crook, and blame starts and ends with him.
<< <i>Edited to add: What's also sick is the lowball selling price the guy accepted for the coin after the sale from you. >>
Could be that dealer lied about how much he actually got for the coin .
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That is one of the worst stories I have heard of. Appealing to AMEX seems to be out of the question; the buyer is obviously a crook and he should have sent the coin back to you when he realized that he wouldn't receive adequate payment from the dealer. Its fraud - plain and simple.
His paltry resitution in no way makes up for the added expenses you have incurred, let alone the cost of the coin. PayPal seems to be useless and unable to collect funds for you. Considering the funds you generate for them, you'd think that they would have some clout with AMEX and denying the charge back.
I'm truly sorry for your situation.
~~~~~~~~~~~~
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Couldn't you just transfer the money from your PayPal account to your bank account and avoid all this?
<< <i>Checks bounce. Money orders are forged. No matter how one gets paid, there is always the chance of getting screwed. Don't blame the middleman. Ira's "customer" is a flat out crook, and blame starts and ends with him. >>
If I'm selling and a check bounces or the money order is refused, the "buyer" isn't getting anything- not until I see money in my bank account. I think there is plenty of blame to go around. Anyone who enables or facilitates a thief is a thief in my book.
If that wasn't so
I think your only recourse is to file a criminal complaint against the buyer and hopefully he'll be ordered to make restitution as part of his sentence.
It's not PayPal's fault and it's not Amex's fault.
Your damages are 100% caused by your buyers fraudulent actions.
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since 8/1/6
<< <i>
Unfortunately, by my accepting ANY money from buyer (I didn't know this at the time) I relinquished my ability to have criminal charges pressed. >>
My posts viewed
since 8/1/6
<< <i>It's not PayPal's fault and it's not Amex's fault. >>
If Amex did actually encourage the slimeball to file a fraudulent chargeback, then they certainly are also at fault.
Russ, NCNE
<< <i>If Amex did actually encourage the slimeball to file a fraudulent chargeback, then they certainly are also at fault. >>
True, but as you said earlier, the buyer is almost certainly lying about this.
I just yanked PayPal off my more expensive auctions. I'll still offer it for the smaller stuff. For now.
Screw'em.
Great transactions with oih82w8, JasonGaming, Moose1913.
<< <i>
<< <i>Amex suggested he file a chargeback for unauthorized use of his credit card >>
I've a hunch that the buyer is lying about that part. I have a hard time believing that Amex would suggest he engage in fraud.
Russ, NCNE >>
Me too
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
I transfer money out of my PayPal account immediately to a separate bank account for ebay items and as soon as possible remove money from that bank account to keep no more than $150 in the account.
Charlie
Also, could you send out this guys ebay ID? My guess is some people here might want to block him.
<< <i>What could PayPal do if your bank account or PayPal account didn't have sufficent funds to cover the charge back?
I transfer money out of my PayPal account immediately to a separate bank account for ebay items and as soon as possible remove money from that bank account to keep no more than $150 in the account.
Charlie >>
I do the same thing but in the case of a chargeback you'd still be on the hook for it. If you didn't pay it I'm sure it would end up at a collection agency.
<< <i>
<< <i>It's not PayPal's fault and it's not Amex's fault. >>
If Amex did actually encourage the slimeball to file a fraudulent chargeback, then they certainly are also at fault.
Russ, NCNE >>
there was six months between the purchase and chargeback. amex will not allow a chargeback that old unless unauthorized use was claimed. buyer prolly couldnt meet the payments and lied to amex.
paypal and sellers protection? lol! if i were ira i would check into criminal charges. a fraud repaying 1800$ does not make him innocent.
There is no way I would ever leave any money in a bank account connected to PayPal. In fact I have refused to get "verified" for that very reason. I am "identity verified" by Verisign but PayPal uses their "limits" to force you to get your bank account hooked up.
When I do get an account I will get a "sweep" account that always has a $0.00 balance as any funds in it are swept out into another account every single day automatically.
PayPal has lawyers on the payroll so they could care less if you sue them. The dishonest buyer has committed a "white collar crime" which is code for "the DA won't prosecute". Once again the good guy is getting screwed and there isn't much that can be done about it.
"Amex suggested he file a chargeback for unauthorized use of his credit card which he can simply do over the phone. "
To me it sounds like Amex could and should be charged with fraud, or something.
I mean if the buyer told them, he bought the coin, he recived the coin and sold it at a loss.
THEN they told him he should do the chargeback against you.
If that ain't fraud, it is certainly pi$$ poor buisness ethics.
The buyer, trying to flip the coin and lossing is his own fault.
I wish you all kinds of luck getting this mess straightened out.
WHAT HAPPENED TO HONESTY?
(Priest) BLASPHEMY he said it again, did you hear him?
<< <i>He signed for it on Nov. 10 and left me favorable feedback on Nov. 12. >>
I was curious who the buyer was also so I checked the feedback and found none for the 12th. and none withdrawn.
no one from that time frame NARU'ed either.
If you find this story distrubing perhaps you should send Paypal a letter mentioning this case and telling them that from now on all high dollar transactions that you do will be without paypal. If they get enough feedback from high dollar clients perhaps it might say something to them.....
thank you. end of story.
paypal has millions of successful transactions.
what is the common problem most of the time in the process? humans.
These are just my opinions and I am sure I will hear I am wrong. Sorry IRAS4 about your situation.