Paypal: A cautionary tale

alex99

Executive summary:

1) Paypal is a convenient way of transferring money to people who are not set up to receive credit card payments (eg eBay sellers).

2) Paypal purports to be "safer" than using your credit card, but this is highly misleading. For payments over £100 you are protected if you use your credit card by something called "Section 75". You lose this protection if you pay using Paypal – even if your Paypal account draws from your credit card account. (Paypal does offer some protection on purchases within ebay however).

3) Paypal have poor customer service, are not interested in discussing questions about whether their sellers may be engaged in fraudulent activity, and may unilaterally close a dispute thereby preventing further buyer communication with Paypal or the seller complained about.

4) Paypal state that they do not “tolerate fraud or illegal activities”. Judging by my experience, this claim would appear to be untrue.

Our story:

My wife and daughter bought two pairs (a pair each) of “UGG” boots from http://www.australia-ugg-boots.com/ and paid using Paypal. The domain “australia-ugg-boots.com” is registered in Australia:

Whois Record
Registrant:
Jackie Beament
PO Box 3950
Joondalup, Western Australia 6027
Australia

Domain Name: AUSTRALIA-UGG-BOOTS.COM
Created on: 28-Feb-09
Expires on: 28-Feb-10
Last Updated on: 01-Mar-09

Administrative Contact:
Beament, Jackie
PO Box 3950
Joondalup, Western Australia 6027
Australia
894048411 Fax --

Technical Contact:
Beament, Jackie
PO Box 3950
Joondalup, Western Australia 6027
Australia
894048411 Fax --

Domain servers in listed order:
NS1.AUSTRALIA-UGG-BOOTS.COM
NS2.AUSTRALIA-UGG-BOOTS.COM

And the site makes the following claim:

Australia-Ugg-Boots.com is a family business manufacturing ugg boots here in our home town Melbourne, Australia since 2007. We manufacture high quality sheepskin footwear made from first grade double faced Australian Sheepskin. Australia-Ugg-Boots.com has been successfully wholesaling and retailing to many satisfied customers within Australia and Overseas. Our website was established in 2007 successfully providing customers all over the world with our great product, cheap prices and fast, reliable, friendly customer service.

A complication here (it should perhaps be noted) is that "UGG" is not a protected trade mark in Australia, but it is in the UK and other countries outside Australia.

When we received the boots (we did receive them) the parcel came not from Melbourne but from Shanghai. The boots were perfectly well made, but clearly counterfeit (with counterfeited "UGG" "trademarks" all over them) and lined with synthetic fur rather than sheepskin. The main problem, however, was that both pairs were each a couple of sizes smaller than ordered and than stated on the sewn in labels. Apparently this is one of the features of counterfeit UGG boots – quite why these firms can fake the boots so expertly and yet fail to size them correctly is, to say the least, puzzling. As we have real UGG boots at home we are able to compare like with not-like.

So we raised a dispute on Paypal.

AUSTRALIA-UGG-BOOTS (of China) got straight back and said we could return the boots and get a full refund. Trouble is that this costs rather a lot of money and they take no responsibility if goods are "lost in the post". The Royal Mail will only cover you up to £39 – unless you pay them shed-loads of money first.
Forgive my cynicism and scepticism, but I do not have a great deal of confidence that, if I sent these boots back to Shanghai, I would ever see my boots or my £130 again.

On to Paypal, the "safer" alternative to using your credit card.

It would by an understatement to say that Paypal have been unhelpful. They simply refused to help and then closed the case without consulting me further. This means that I can no longer communicate with them or the seller about this case. More worryingly, Paypal are (it would appear) continuing to trade with this company (which would certainly seem to be committing offences under UK law) and refusing to warn other potential buyers about the pitfalls of buying from the website in question.

As our experience illustrates, the fact that Paypal accepts a seller onto its books is no guarantee (or even indication) that that company is "kosher". In fact, the fact that a company only accepts Paypal and does not accept direct credit card payments may well be an indication that further scrutiny of that company is required before buying from it.

If you make payments over £100 using your credit card– even to companies in China – you enjoy buyer protection. If you use Paypal you lose that protection – it is not "safer" at all.

I shall, in future, use Paypal (if at all) only as a means of last resort to pay for goods and services and I suggest anyone reading this does the same.

Meepster

And once again - if something seems too good to be true, it usually is...

98jdougl

If you didn't want to send them back open a disputewith paypal claiming they are conterfeit although you will need to go to trading standards and get a statement showing that they are infact fake.
Anything you send send it recorded delivery and enter the tracking into paypal- it's not up to the company to refund your money, once it is signed for alery paypal and they will take the money out of the other customers account and refund you

alex99

@mwilletts

Well this is not quite so straight-forward. Because "UGG" is not a registered trademark in Australia (cf the UK), you can quite legitimately buy sheep-skin boots from Australia that say "UGG" on them but which do not pretend to be "Deckers" UGGs and are much cheaper than the official "Deckers" UGGs - my daughter also has a pair of these that she bought on the internet from an Australin firm that really was Australian.

The boots we have been supplied (thought counterfeit) are perfectly good boots for the price - if only they were the size they claimed to be.

But what I really wished to bring to everone's attention was the fact that Paypal is far less safe that a credit card (something I had not realized until now) and that their custosmer service is woeful.

alex99

98jdougl wrote: »

If you didn't want to send them back open a disputewith paypal claiming they are counterfeit although you will need to go to trading standards and get a statement showing that they are infact fake.
Anything you send send it recorded delivery and enter the tracking into paypal- it's not up to the company to refund your money, once it is signed for alery paypal and they will take the money out of the other customers account and refund you

As I said, I opened a dispute with Paypal. They closed it and are refusing to discuss the matter. They offer no protection outside ebay. Period!

I can return the goods in 2 separate parcels surface signed for @ £13.18 per parcel and get £39 per parcel compensation.This will leave me £78.36 out of pocket but is what I may do.

You live and learn.

But the main things I have learned is that Paypal is should be used only as a means of last resort.

vikingaero

Make a complaint to the Financial Ombudsman Service. It will cost you nothing even if you lose.

Meepster

@alex99

Well if you aren't concerned with the fact they ARE counterfeit, then why do you mention the fact that they are in your original post?

Also, it clearly states in their T&C's that if you aren't happy with your purchase, then you can send them back for a full refund. And that you wont get the original postage/packaging costs back. And also that they wont be held responsible for anything that gets lost in the post.

So, I presume, you actually READ the T&C's before you purchased? Therefore you were perfectly happy with them, as you THOUGHT you were getting a bargain. Now that it turns out, you have infact been ripped off, you are feeling hard done to?

Why is it Paypals fault? You have a problem. The seller has offered a solution (that is prefectly visable on their website) but you don't want to accept their solution. I'm sorry, but you only have yourself to blame. Or maybe you can blame the suppliers, but in NO WAY Paypal...

alex99

mwilletts wrote: »

@alex99

Well if you aren't concerned with the fact they ARE counterfeit, then why do you mention the fact that they are in your original post?

Me: I AM concerned with the fact they are counterfeit, but this is just part of the fact that the goods are not as described. [I was making the point that., if the boots had at least been the stated size we might have simply "cut our loses" and kept them, but what we do or might have done in this individual case is not really relevant to the general issue here.]

mwilletts wrote: »

Also, it clearly states in their T&C's that if you aren't happy with your purchase, then you can send them back for a full refund. And that you wont get the original postage/packaging costs back. And also that they wont be held responsible for anything that gets lost in the post.

So, I presume, you actually READ the T&C's before you purchased? Therefore you were perfectly happy with them, as you THOUGHT you were getting a bargain. Now that it turns out, you have infact been ripped off, you are feeling hard done to?

Me: You are right. I should have read the T&Cs - though, because the goods are not as described, I object to having to return them at my own risk and expense and, under UK law, I would not be liable in this way. Yes I thought I was getting a bargain. I was naive. Again none of this is really relevant to my main point.

mwilletts wrote: »

Why is it Paypals fault? You have a problem. The seller has offered a solution (that is prefectly visable on their website) but you don't want to accept their solution. I'm sorry, but you only have yourself to blame. Or maybe you can blame the suppliers, but in NO WAY Paypal...

Me: I did not say this was Paypal's fault. I said that, and it is true that:

1) Paypal does not offer the same protection as a credit card for purchases over £100 outside eBay.
2) Paypal does not alert buyers to this fact - claiming merely that it is "safer".
3) Paypal unilaterally closed my dispute thereby preventing me from contacting them and (more importantly) the seller further.
4) Paypal claim that they do not tolerate fraud or illegal activities and this is manifestly untrue.

This was the main point I wished to get across to users of this forum!

(I may still use Paypal for purchases under £100 within eBay but I shall be more circumspect in future).

pulliptears

I have seen so many people who just don't research what they are buying! You couldn't claim they were fake as they were not sold as Genuine Deckers Ugg Australia, as Ugg is a generic term for a sheepskin boot you got exactly what you ordered and paid for.

Genuine Ugg sizes vary anyway so its always wise to buy from a high street store and try before you buy. Size differences are not just attributed to non Ugg Australia boots.

Forgive me if this sounds harsh, but you ordered and received generic uggs.

alex99

pulliptears wrote: »

I have seen so many people who just don't research what they are buying! You couldn't claim they were fake as they were not sold as Genuine Deckers Ugg Australia, as Ugg is a generic term for a sheepskin boot you got exactly what you ordered and paid for.

No, these boots are counterfeit Deckers Uggs and use the registered UGG Australia trademark - something which is not allowed in the UK.

pulliptears wrote: »

Genuine Ugg sizes vary anyway so its always wise to buy from a high street store and try before you buy. Size differences are not just attributed to non Ugg Australia boots.

No! These are exact replicas of a particular style of Deckers Uggs - exact in every detail except for the materials used and the sizes. But you are right, it's always best to buy shoes from a high street store.

pulliptears wrote: »

Forgive me if this sounds harsh, but you ordered and received generic uggs.

No, see above.

But again, regardless of our naivete here, the main points that are wished to bring to everyone's attention were the things I have discovered about Paypal.

As I have said, this does not mean I shall never use Paypal again for any reason, just that I have realized that they are not as "safe" as I had believed.

alex99

Paypal are really going out of their way to be as unhelpful as they possibly can be.

Not only have they closed the dispute so that I can no longer communicate with the seller, but they have removed the seller's contact information from the dispute log (should have kept a record I suppose but I never dreamt that Paypal would behave in this way).

I keep emailing Paypal, but I just get replies back from people who have failed the Turing test, not actually read my emails, and just parrot the standard text about the fact that Paypal does not offer any protection outside eBay.

Financial Ombudsman here I go.