Paypal scams?

Niteflyer

I had a dispute with Paypal about 2 years back, I bought a TFT monitor from eBaY and it never arrived, I contacted Paypal and they opened a dispute, I also contacted my local police and reading police (where the seller lived) and both police forces told me that there isn't much they can do. They both said that due to data protection issues it would be very diificult and expensive for them to get any info on the seller from Paypal and as it was only for £270 it wouldn't be worth their while

Paypal replied ot my dispute and said "sorry we are unable to retrieve funds.........."

Basically if the seller still has enough money in his/her Paypal account, they can sieze the money but if he has transferred it to a bank, they won't do a thing. In my case I received 35p and I was very !!!!!! off!

Getting annoyed even now just thinking about it!

Matt

Shiggaddi

They both said that due to data protection issues it would be very diificult and expensive for them to get any info on the seller from Paypal and as it was only for £270 it wouldn't be worth their while



Which is exactly why scammers get away with it. Perhaps they might want to be this lax, and not bother contacting the DVLA to investigate parking, and speeding fines.

I personally think the police offer that said £270 is not worth the hassle is narrow minded. The scammer I encountered on ebay deliberately set up fake auctions, and conned around £10,000 from ebay users. If the police won't take action, maybe media attention will. Ebay make alot of effort in trying to convince people that it's safe to trade on ebay. Perhaps if media attention contradicted this claim, ebay and paypal (which is owned by ebay) would clean up their act, and make it harder for fraudsters. One good idea, would be that if you receive funds in your paypal account, you cannot withdraw these funds for 2 weeks, which should allow ample time for the post, and if someone was about to do a runner with the money, a complaint would be bought against them within 14 days, in which case if a transaction is under investigation, then naturally paypal would not allow access to these funds, until paypal decide who is the rightful owner of the funds. In fact this policy would even deter them from scamming ebay and paypal in the first place!!

Naturally law abiding ebayers might find it inconvenient to have no access to the money within 14 days, but I'm sure it will be a price worth paying to stamp out fraud. After all, if you accept a cheque from someone, you have to wait almost a week for it to clear, and cheques have been around for many years.

charlie12

Interesting thread My 2 pence:

Shiggaddi wrote:

I don't know how paypal respond to the credit card companies. Do they try and fob them off with "we can't recover the funds and we're not paying" or do paypal stump up the money anyway, especially if the seller doesn't put up a defence. It certainly explains why paypal prefer direct debit funding, instead of credit card funding.

AFAIK, Paypal do generally pay up to the CC companies in the event of a chargeback. The seller's account will then be blocked and the balance will go into negative figures (or the funds will be taken from the balance). They then contact the seller and ask them to pay back the owed money (if any). If that doesn't happen, Paypal may try to recover the funds via any credit cards that the seller has registered (not sure about this one). If that fails then after a certain period of time they may issue debt collectors depending on the size of the negative balance.

How do paypal persue the matter further. Surely the funds have gone to a bank account, which would obviously be on paypal file. Surely it's a matter to get police intervention, for the bank to discolse who the account belongs to. Surely with modern technology, it might involve a little bit of work, if people can be bothered, but it's not impossible to trace where the money has gone, even if using a false name on paypal.

Yes, Paypal (and therefore eBay) have plenty of info to supply the Police, however in most cases they won't bother. Perhaps in cases of large scale fraud they may bother to look into it but remember with Paypal profits always come first so if it's easier/cheaper to issue debt collectors to recover their funds, or write off small losses, that's what they will do.

If paypal can't be bothered to take any further action, except say "Let's just pay the credit card company, and offer our customers standard protection" then this will spiral out of control, and make ebay/paypal easy pickings for fraudsters.

IMO it's already spiralled out of control, the amount of Paypal fraud on eBay is massive! See https://www.paypalsucks.com

Maybe some stronger warnings on their home page, and articles of previous convictions to state that they do not tolerate fraud would help!!

We can only hope, but as long as Paypal are not losing large amounts of money from fraud then things will just continue the way they are

Niteflyer

This is from another website, don't know if it's true or legal but here it is.............

"According to PayPal accepting their ToS (Terms of Service) in effect means you waive your rights to credit card consumer protection laws if you want to use their service, and that you may not issue a chargeback for unauthorized use of your credit card and PayPal account, or if you do, then they have the right to limit your account."


Matt

charlie12

Niteflyer wrote:

"According to PayPal accepting their ToS (Terms of Service) in effect means you waive your rights to credit card consumer protection laws if you want to use their service, and that you may not issue a chargeback for unauthorized use of your credit card and PayPal account, or if you do, then they have the right to limit your account."

I read that too Matt, that they do not officially allow CC chargebacks to be made but they can't ignore CC companies' requests to pay up, so they do, and then recover the funds from elsewhere - i.e. the seller.

I think they also have the right to block the buyer's account so it's best to make sure you remove all cards and withdraw any balances before making a CC chargeback.

Niteflyer

charlie12 wrote:

I think they also have the right to block the buyer's account so it's best to make sure you remove all cards and withdraw any balances before making a CC chargeback.

they do have the right to block the accounts but these !!!!!! that rip people off don't leave the money in the account, I agree with Shiggaddi that there should be a minum time the funds should stay in the account, yes 14 days or until both parties are happy the the transaction has completed succesfully (which ever comes sooner)

charlie12

I meant they also have the right to block the (honest) buyer's account, too,

But yes I agree about the minimum time for funds to stay in the account - ironically that would make even more money for Paypal as they'll earn interest whilst they have the funds! It would also p**s off honest sellers who already have to wait around 7 days for funds be withdrawn.

Cumbrian_Male

paypal.co.uk was set up last year, if I remember correctly, previously it was paypal.com in the USA

Paypal.co.uk is an emoney service and is governed under FSA guidelines again if I remember correctly.

When you use paypal you purchase emoney from them to pay the seller.

In effect your debit or credit card transaction is with paypal and they HAVE supplied you with the service so completed the transaction with your debit or credit card.

You then authorise paypal to send your emoney to the seller in payment for the goods or service required.

If ANYTHING goes wrong your compaint is with paypal and the seller, not your card issuer. However they may refund you as goodwill, but Paypal did credit your account with the emoney you purchased.

I personally believe that Paypal deliberately set it up this way to bypass section 75 protection of the Consumer Credit Act.

Shiggaddi

I think they also have the right to block the buyer's account so it's best to make sure you remove all cards and withdraw any balances before making a CC chargeback

That is well cheeky!! Paypal allow a fraudster to operate, through their lax controls, and then the buyer has to waive their right for a refund, because paypal did as they were asked, and that was to send e-money to someone.

Well, I purchased my "e-money" to give to a member of the paypal community that paypal have authorised to allow money, also this was a power seller of ebay, who both paypal and ebay regarded as trustworthy. If paypal want to hide behind small print, and legal jargon, then if I'm not allowed my money back, then maybe there is a case to sue paypal for not doing their job properly, and creating the perfect environment to commit this fraud, and by carrying out insufficient checks on people who they have authorised to join their "e-money" service.

Maybe thats why they just pay up to the credit card companies without a fight. There will be many others who will either be complaining to paypal about this fraudster or serving a chargeback notice via the CC company. He already had 30+ negative comments, before being banned by ebay (including one from me!!) Surely paypal can't defend all these complaints!!