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FAILURE Bank account tied to PayPal? Beware.

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MJ DeMarco

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I pulled this from another forum ... this made me realize that someone could login to my paypal account and initiate a transaction, totally cleaning out my bank account. If that happens, I'm STUCK WITH PAYPAL'S dispute resolution. And PayPal's assurances? "Don't worry, we will send you an email" -- really? They sent this poor guy an email and they f*cked him over, refusing to refund over $1,000. Imagine if this was $10,000 ... remember, this is your bank account!

As a result, I removed my bank account from PayPal -- there's no way in hell I'm giving these bozo's and their "dispute policies" any chance. Control, control, control...

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Paypal users beware. 100% buyer protection is BS. I am going through one of the most ridiculous situation of my life, and I hope by writing this, I might save someone from dealing with the same thing.

I usually don't keep any money in my Paypal account, but about a week ago, I sold an item on Ebay for $1400 and they paid by Paypal. Later that night, I receive a confirmation email from Paypal about two payments I made. One was for $12 and the other was for $1200. I immediately assumed it was one of those scam emails where they try to get you all riled up so you will log into your account from the email and then they will have your account info, so I close the email and went to Paypal.com. After logging in, I confirmed that two payments had been taken out of my account for $12 and $1200. I immediately disputed the transactions. The next day, I called Paypal (during business hours) to confirm the disputes. They told me that it would take about 3 days to reach their decision.

The next day, I received an email saying that they decided in my favor on the $12 charge and refunded the money back to my account. Great. It wasn't until a day later that I get the next email from Paypal. This one says that after investigating the situation, Paypal has decided that I did approve the $1200 payment, I would not be getting the funds back, and the case was closed. You can imagine how I felt about that one.

The next day, I called Paypal to try and figure out what was going on. They told me that they confirmed that I did, in fact, send John Smith (obviously not his name) a payment for $1200. I told them that I have never heard of John Smith, and I have never communicated with anyone at his email. They told me that someone from my computer authorized the payment. I told them that there was no way that a payment was authorized by me for $1200 to John Smith. They told me that a room mate or someone else in the house must have done it. I told them that the only people in my house are me and my wife, and that she did not use it. He finally broke it down for me by telling me that they decided against me because when you login to your Paypal account, their system records info about the computer you are using. If it is from the same computer you have always used, it is proof that you are the one sending the money.

At this point, I am a bit baffled. I know that I did not send this money to someone I do not know. I know that my wife is the only other person with access to my laptop, and she did not do it. I start to get paranoid. Did someone get close to my house and hack into our wireless networks? I ask Paypal what I purchased from John Smith. They said that it was a "personal payment". You mean I just gave someone $1200 for nothing in return? Yep. I said that I did not know John Smith, I do not know that email, I did not send him $1200, and I have no idea why it shows that the payment came from my computer. They said that they would would reopen the investigation and get back to me. Later that day, I receive an email stating that they have re-reviewed the case and decided against me, again. I call again and they now treating me like a criminal with short snippy answers.

I ask them for John's contact info. They told me that they cannot give out that information. Let me get this straight. Someone can accept $1200 as a personal payment from me, but I can't ask for their phone number? I can understand not giving out contact info to just anyone, but you have now decided that I intentionally sent this person $1200 with nothing in return, but I shouldn't have access to their phone number or address?! That is absurd. I asked them what do I need to do next, and they basically told me that there was no "next". This is their decision and that's that. I asked them for the IP address they have for my computer so I can investigate on my end to try and come up with something. Anything. They told me that they cannot release the details of the investigation unless I write a letter to some office. My blood was absolutely boiling! Paypal, the safe payment company, the 100% buyer protection company, had just left me out to dry in the worst possible way. I was baffled.

Just for the hell of it, I decided to email John Smith. I told him that I did not authorize the payment, and I would be going to the local authorities the next day if I did not hear from him. I told him that I just wanted my money returned to me. It was a shot in the dark, and I really did not expect a response. Finally, the heavens parted and tiny sliver of light shone down on this dismal situation. John Smith actually emailed me back! This is what he sent…

"I don't know if the transaction is Unauthorized or not, but i already send $1200 to maximazorrxxxx@xxxx.com alertpay account. As this guy send me $1200 for exchange transaction. I already send $1200 to his account.
Contact him and recover the money from him, because he send this money to my account and i send $1200 to his alertpay account.
I am providing PayPal to Moneybooker, AlertPay and Liberty Reserve Exchange Service. My Blog is xxxx.blogspot.com"
(I x'ed out the email and web address)

After reading that email, I am guessing that I have gotten caught up in some sort of scheme involving a chain of payments from one Paypal account to another making it difficult to find the person responsible. I call Paypal back and tell them about the email. After some coaxing, they allow me to forward both emails (to and from John) to them and they reopen the case. As I am writing this, I still have not heard their decision about this. The last fraud specialist I spoke with told me to do a spyware scan on my computer. I told her that I am running security software, but I would do a fresh scan. She told me that there is a certain virus that can get onto your computer that will find out your login info, and send information from your computer. She made it sound like this is probably what has happened here. She also made it sound like they are not responsible for security issues on my end, and they might try to use that angle to get out of making this right for me.

No matter how this winds up, I have been made to feel like a criminal by Paypal. They have done very little to help me out here, and if I wouldn't have contacted the crook, or if he would have been dumb enough to respond, I would have been dead in the water. They had decided the case was closed. Forget the fact that I didn't purchase anything from the guy. Forget the fact that the $12 charge that was made at the same time was reversed. Oh yeah, and what about John's email? If what it said is true, he has $1200 payments coming and going in and out of his account. Wouldn't that look a little suspicious? And if I am that adamant about this, what would be the harm in asking John Smith to forward some email correspondence proving that I agreed to send him the payment. I mean, surely we would have had some kind of communication about the transaction before I sent him a personal payment for $1200, right?

The entire situation is absurd! If they do wind up reversing the charge, I am going to transfer the funds to my bank account and cancel my Paypal account immediately. I hope this story keeps someone from going through what I have experienced.

Oh, and by the way, I came home and did a complete virus scan (took about 1 1/2 hours) and it found three items. One was a "worm", and the other two were "trojan horses". Make sure to do the complete scan, and not the quick scan that it normally does. The quick scan was obviously overlooking these.
 

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Runum

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This is exactly why Paypal and I don't get along. I agree, do not allow them access to your checking account. Thanks MJ.
 

exon

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I never have any money on PayPal account and when I pay for something they take money directly from my credit card, so PayPal is for sure tied to bank account. Thanks for advice.
 

andviv

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Done, bank acct removed.

I guess I will have to get their credit card or debit card in order to use the funds then....
 

Rocky

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Paypal is the worst from past experiences, another company that's just as bad is eBay at least for the seller eBay always takes the side of the customer even when the customer is wrong.

Also those companies charge too much.
 

TOLDUSO

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Wow, thanks.

Paypal has always seemed a little shifty to me anyway. I believe this story to be absolutely true. That said, even for someone who didn't buy into it, it's still a very likely scenario and therefore everyone should reconsider having an account tied to paypal.
 

minamo

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What a mess.

I use moneybookers personally.
 

Rocky

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PhxMJ, I had something similar happen. I bought a used item that was supposed to be in good working condition ,but it was not I did the paypal dispute (what a joke) paypal said because I received the item everything is fine.

To make a long story short I called my bank and filed a dispute with paypal. My bank refunded me 100 percent of my money. It might not be too late try calling you bank in the morning.

P.S. The bank may not be able to help you if it is not one of the major names out there.

Good luck.
 

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Rocky

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Sorry it was late last night and I was reading so much. I must of forgot the first part.
 

sk24iam

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On the subject of paypal... I recently opened a business account with the plan to switch over to authorize.net and a merchant account in the future. I'm only using paypal to get a startup going. Anyways, does anyone know if when receiving money in a business account through a shopping cart, does paypal charge a fee for all transactions including transfers from a paypal balance rather than using a credit card/bank account?
 

aptohosting

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MJ,

I had this same BS happen with me about a year ago, I just went right over PayPal's head. I contacted Wells Fargo fraud department, said that PayPal took unauthorized funds from my account. Wells Fargo went and reversed the entire amount back to my account the next day.

Try contacting them and let them know what happened.




I pulled this from another forum ... this made me realize that someone could login to my paypal account and initiate a transaction, totally cleaning out my bank account. If that happens, I'm STUCK WITH PAYPAL'S dispute resolution. And PayPal's assurances? "Don't worry, we will send you an email" -- really? They sent this poor guy an email and they f*cked him over, refusing to refund over $1,000. Imagine if this was $10,000 ... remember, this is your bank account!

As a result, I removed my bank account from PayPal -- there's no way in hell I'm giving these bozo's and their "dispute policies" any chance. Control, control, control...

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.
.
.
.
.
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biophase

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On the subject of paypal... I recently opened a business account with the plan to switch over to authorize.net and a merchant account in the future. I'm only using paypal to get a startup going. Anyways, does anyone know if when receiving money in a business account through a shopping cart, does paypal charge a fee for all transactions including transfers from a paypal balance rather than using a credit card/bank account?
Paypal charges for every time you receive money. I believe its 2.9% + .20 for each transaction. BTW, you should leave paypal as a payment option even if you have authorizenet. For some reason during this Xmas season the percentage of customers paying with paypal is very high.
 

exon

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This is mail I've got from PayPal TWO months ago, and till today I can't access my PP account. After 10+ emails sent to support - no answer:

As part of our security measures, we regularly screen activity in the PayPal system. During a recent screening, we noticed an issue regarding your account.



We have reason to believe that your account was accessed by a third party. Because protecting the security of your account is our primary concern, we have limited access to sensitive PayPal account features. We understand that this may be an inconvenience but please understand that this temporary limitation is for your protection.

Case ID Number: PP-001-080-295-186


For your protection, we have limited access to your account until additional security measures can be completed. We apologize for any inconvenience this may cause.

To review your account and some or all of the information that PayPal used to make its decision to limit your account access, please visit the Resolution Center. If, after reviewing your account information, you seek further clarification regarding your account access, please contact PayPal by visiting the Help Center and clicking "Contact Us".

We thank you for your prompt attention to this matter. Please understand that this is a security measure intended to help protect you and your account. We apologize for any inconvenience.

Sincerely,

PayPal Account Review Department


Please do not reply to this email. This mailbox is not monitored and you will not receive a response. For assistance, log in to your PayPal account and click the Help link in the top right corner of any PayPal page.

----------------------------------------------------------------
Copyright © 1999-2010 PayPal. All rights reserved.

Consumer advisory- PayPal Pte. Ltd., the holder of PayPal’s stored value
facility, does not require the approval of the Monetary Authority of Singapore.
Users are advised to read the terms and conditions carefully.
 

CarrieW

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the debit card you have to allow them your checking account info in order to get it!

I did get one but have since removed my checking acct info from there so Idk if its still active as I had to remove my info becauase my son spent money on facebook from my checking account thru paypal! hes only 8 yrs old! the pirate game he was playing prompted him to purchase iot and he just clicked yes I was sitting right next to him it didnt ask him for a password or nothing cause it was previously entered!)

I have no idea if they require it for the real credit card you can get.

I have a prepaid visa from walmart that I use for my paypal account now!
 

Bozigian

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Their are tons and tons of stories about paypal like the one MJ posted above out on the web.

One of the oldest tricks that I know ebay users get is when they sell a dress or other clothing and the person who bought it recieves it, wears the dress for an event and then decides to send it back. Claiming it was torn etc, if the seller will not refund the money back to the original buyer then your account will get frozen.

I have also heard of instances where some of the employees that work overseas for paypal will sell peoples information for a sum of money.
 

mrhahn

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I really hate Paypal and their practices. Unfortunately so many people use it b/c of ebay that it's hard not to offer it as a payment option.
 

Neon

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Another good reason to use Roboform.

It's not foolproof but most trojans are keyloggers. Because no keys are actually depressed using Roboform even if the trojan is looking for keystrokes it will not see them.

Again, it's not 100% foolproof but serves as another layer of protection- it's handy too.
 

ClintonSkakun

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From a developer's prospective PayPal sucks also. It's so hard to code for. When I think back to the days and days I spent ripping my hair out over their next to impossible, confusing docs it makes me want to sue!

I played with Authorize.net's test API and figured it out within an hour. It was so simple I was blown away.

Starting a web service, I also went into this keeping in mind the Law of Control. I knew if PayPal crapped out, my service and my cashflow would be SOL. I looked for the best alternative solution to PayPal, after hearing horer stories and wanting complete control. Authorize.net seems like the best choice.
 

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SweetJones

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May 1, 2009
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WOW.

Why didn't I ever run into this thread before opening a merchant account with them a month ago?

I have lost approx $6k in last week because of them. Wanna know why?

Confused customer claims he never received tracking number so he calls his CC company, gets the chargeback and now PayPal shuts me off and says I need to verify my business. Didn't I have to submit ever single form a billion times to not only OPEN the account, but keep up with the reviews?

I don't care how much more money I run into, they will never have my business.

And also, who's going to wait 180 days before you can appeal?

No thanks!

For all biz owners, work with your bank merchant services and save yourself the headache.
 

paqman

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this made me realize that someone could login to my paypal account and initiate a transaction, totally cleaning out my bank account.
Why not just use a stand-alone sweep account? We've got a separate merch drop account for any incoming wires, ACH, or other deposits from merchants like PayPal. If you're overly concerned, it may make sense to have a simple checking account to use for sweeps just to keep empty. Money comes in, move it to Checking/Savings. Keep the account at $0 at the end of a day/week, and mitigate risk.

Also, when making payments via PayPal, always select credit card (and tie in with debit card or credit card). Keeps the account flush without as much risk as the PayPal "instant payment" option via Checking/Savings.

I **may** be completely off base, but this is how I've been using PayPal for years... And for anyone with a merchant account, switch to Braintree. Super easy payments, setup, well respected. We saved over $5-7k annually by getting rid of merchant account + fees + gateway (auth.net). Same process, setup a sweep account just for your merch processing too.
 

Travis.I

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Yah PayPal is the absolute worst payment processor ever.

I could go on about my story, but I am now blacklisted with the company, and loosed all the money I had on me which was about $1k.

2 BBB disputes and they wont help me for shit get my account back up and running.


They claimed that I did money laundering, used stolen credit cards, and identity theft.


1. You can't use a CC/Debit card on a student PayPal account.
2. All the info on the PP account was my info.
 

DaRK9

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lol those arent even safe

in fact the ability to crack those is very well known


If you are worried about key loggers, just down keyscrambler
I should have specified. On Screen Keyboard in browser. Most loggers do keystrokes and screenshots, but most have the screen shots timed too far apart to capture any real data.

Key-loggers are a bigger deal than you would think. I had my Gmail hacked that way once.

I'll have to look at that software and try it out. Thanks.
 

BlakeIC

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I should have specified. On Screen Keyboard in browser. Most loggers do keystrokes and screenshots, but most have the screen shots timed too far apart to capture any real data.

Key-loggers are a bigger deal than you would think. I had my Gmail hacked that way once.

I'll have to look at that software and try it out. Thanks.
Yea the in=browser virtual keyboards keystrokes can still be collected
It is actually quite easy to do
 

DaRK9

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Yea the in=browser virtual keyboards keystrokes can still be collected
It is actually quite easy to do
That's crazy. Even the encrypted ones? Not ones that just pass the data through to the field?


Sent from my iPhone using Tapatalk
 

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