The risks of using Paypal - Read and judge for yourself

[Pick-A-Part]

Paypal has ripped off our company and personal employees more than once.

The process is simple. You get a visa gift card from a bank, and any bank account. Since you can set the gift card to say any name and address online, and since bank accounts don't tie to names or numbers, you can get a "verified" account without any real information.

With a verified account, you can "sell" items on eBay, and keep the funds in your account to buy from other verified sellers for, or withdraw the funds to the bank account and then never use that Paypal account again.

Buyer and seller protection does not apply with Paypal unless the money is still in the Paypal account. If they withdraw it, you lose.

If the fraudulent account buys from you, they send you what appears to be real funds with a verified account address. You won't know till weeks later that the account was fraud, and by then your product is LONG gone. Paypal does nothing to help you.

If the fraudulent account sells to you, you send the money to it, and then they either buy items from their Paypal balance, or send the funds to their account. After you report an item not received after a week, the money is long gone, and Paypal does nothing for you.

These are the reasons none of us will use Paypal, and we suggest you think twice before using it as well.

Visit www.paypalsucks.com (http://www.paypalsucks.com/) or www.nopaypal.com (http://www.nopaypal.com/) to read thousand of testimonies by other people who have been ripped off in a similar matter.
Last time I checked, there was over 8.400 topics where people have been ripped off.

Feel free to let us know if you have any questions.

[jaak]

So what do you use for an alternate?

[lowriderman3]

Been using Paypal since the beginning. I buy and sell. No problems here. But this is not really Paypal's fault is it? Sounds like the problem is much bigger than Paypal itself. I will have to say that Paypal has to be the safest way to transfer money online. You take a risk with any online transaction. Heck even money orders can be fraudulent. Everyone takes a risk everyday with online dealings.

I have a company that I sent back a TV and they have NEVER credited my account. I have tracking info that they received it even..They keep passing me around from person to person everytime I call. They know I will give up eventually. If someone wants to be dishonest, they will take many people along the way.

[Pick-A-Part]

We accept credit cards over the phone or via our online payment form, we also take money orders.

A money order that is held with time to clear is a fail safe method.

It is paypal's fault. There is fraud in any field, you are right. However, they offer "buyer and seller protection" for using their service that yields nothing when you actually need that protection. That is why it IS paypal's fault.

[lowriderman3]

^^Yea that is sad how they get around that part of the seller protection.

[Magma]

That sucks.... I persoanlly havent had any problems with Paypal *knock on wood!* ...

[LP81]

I personally haven't had an issue yet, but then again I only do business with people I know... i.e. people on here... and ones that have been around for more then a couple posts... that way there bound to be someone else who knows them or have met thm that I can talk to if they happen to rip me off (which I would never expect from anyone on here) Much different if I was a business, I probably would go to CCs as well (even if I had to pay a transaction fee like I know you do)

[Pick-A-Part]

Right - If you deal with people on here and people you know, you will be safe. But be VERY careful on ebay. I wouldn't want any of my fellow LXForum members to get ripped off ANY amount of money because they were not aware of this. BE SAFE!

[sugar-tj]

now ya tell me, i just used my paypal account on e-bay, but, i must say, i haven't had any trouble with the account, i have used here several times here as well. i did however, have someone contact me, saying they were from paypal, wanted me to log on, and check something out, i did, (dummy me) and found it WAS NOT paypal, i called paypal, they told me to change my info (password) and they would keep an eye on my account, well, i never got any bad charges, but, now i know, paypal DOES NOT send e-mails to ''fix'' or ''check'' any information.. i guess i was lucky..

[jaak]

We accept credit cards over the phone or via our online payment form, we also take money orders.

A money order that is held with time to clear is a fail safe method.

It is paypal's fault. There is fraud in any field, you are right. However, they offer "buyer and seller protection" for using their service that yields nothing when you actually need that protection. That is why it IS paypal's fault.

But I don't buy everything on eBay from you...

[Pick-A-Part]

We accept credit cards for items purchased through LXForums as well. Thanks

[32Noir]

I also have been using PayPal regularly on eBay & Audiogon since day one with only one instance where things went bad. In that case, I ultimately prevailed but had to deal with both PayPal and my credit card company. It's definitely best if you can establish some kind of comfort level with the buyer or seller first. A phone call often will tell you volumes about a person. If that's not possible, I'll either use a credit card via PayPal or just not do the deal. Feedback can be a good indicator of honesty as well, but it's not infallible. It's truly sad that we have to take extra measures to protect ourselves but it's a sign of the times. Imagine if there was no internet to make all of this e-commerce & communication possible. We wouldn't even be having this discussion.

[tezzer]

Let me tell you about my money order experience. I sold a CAI to a dodge talk forum member. Recieved maney order, help it for two weeks. Called bank to verify the funds, all was good. 3 months later I look at my account and a 200.00 debit was made from the bank. Called to see what the issue was, they said the US post office money order I used was a fake. I explained that I had held it for 2 weeks in there bank, even called to verify the funds, and they said it was all good. They said that sometimes it takes time for things like that to show up... Needless to say, I'm no longer with that bank, I realize it was not their fault, but 3 months untill they figure it out, then never send me anything in the mail to tell me about it, WTF!! Anyhow, point is you can get scammed anyway.. Really sucks.

[CoolVanilla]

Man, I haven't had near the issues you speak of. I've successfully completed over 600 transactions thru PayPal, and three times has someone tried to scam me (all three I was the seller).

In all three cases, PayPal did freeze the funds in my account and they set their fraud department on it. I received a name and number of someone responsible for my account. Each time they stayed on the problem and in each case I eventually won. The funds were unfrozen and they dealt with the fraudulent account. In one case, PayPal ruled in my favor, but the scammer reversed the charges thru their credit card. PayPal actually went to bat for me against that credit card and eventually the credit card co found in my favor also. Granted, had they not I would not have received my funds even though PayPal ruled I was right.

In my case and for my purposes thus far, PayPal has protected me and done the 'right' thing each time.

And for a little perspective, you mentioned 8400 topics; compare that to the 1.5million transactions per day (as of last year) PayPal executes and I think the failure rate is fairly small (not implying there arn't problems, just suggesting that perspective is a good thing in this case).

Still, as you rightly point out, its good to know who (seller or buyer) you're dealing with if possible.

[Pick-A-Part]

I agree. And if the bank did not work with you on that, I would have switched banks just as you did.

[Pick-A-Part]

While I agree that there are millions of sucessful transactions, my company and a few of my employees have all lost money. I am glad you have over 600 sucessful transactions, but all it takes is one negative one for $1,000 to make you change your tune.

[CoolVanilla]

While I agree that there are millions of sucessful transactions, my company and a few of my employees have all lost money. I am glad you have over 600 sucessful transactions, but all it takes is one negative one for $1,000 to make you change your tune.Very true.

One thing: have you considered not accepting credit cards thru PayPal? You can specify that you do not accept them via your account settings. This thus requires the buyer to have the funds physically in their account or bank account at the time of transaction, and I've found it weeds out many of those intent on fraud.

Also, I do make it a habbit of leaving my PayPal balance at zero. No need for PayPal to make the interest on my money, and it prevents anyone from sucking back out the funds.

[Pick-A-Part]

We've thought about this, but that doesnt change the fact that if someone has someone else's money in their active balance, they can still use that to pay for any item. Then when the original person that got ripped off files a claim, it limites the fraudlent account, and reverses all charges sent or received. This still gets us.

I use paypal once in a blue moon to PAY for an item on ebay, using only my credit card. There is no doubt its the fastest way to make payment, just not the safest.

I also keep my account at zero. Atleast this way when they issue a chargeback, it just makes my account go negative, and paypal doesnt send negative accounts to collections. You just have to open another.

Keep in mind this is not a personal attack on anyone or any service, we simply wish to inform our friends and customers at LXForums so that they may learn from our mistakes.

[CoolVanilla]

Keep in mind this is not a personal attack on anyone or any service, we simply wish to inform our friends and customers at LXForums so that they may learn from our mistakes.S'all good. Learning is what this place is all about. Again, it sucks to read about the problems you're experiencing.

[lowriderman3]

We've thought about this, but that doesnt change the fact that if someone has someone else's money in their active balance, they can still use that to pay for any item. Then when the original person that got ripped off files a claim, it limites the fraudlent account, and reverses all charges sent or received. This still gets us.

I would make sure to not accept credit cards, and only funds from bank accounts as metioned above. When you use the word "VISA" or "MASTERCARD", Paypal has to immediately act, and a lot of times you will lose with a Charge Back. That gift card has the name VISA attached to it, so it falls under the VISA rules....Visa and Mastercard are a monopoly and what they say goes. They can bully anyone just about, and if you do not listen, they will just make your business not able to accept Visa or Matercard any longer.

[Pick-A-Part]

That wouldn't be a problem, but once you say you accept "Paypal," your going to have alot more problems with buyers that want to use their credit card funded paypal payments, and not just bank accounts. Plus bank account take 3-5 business days, and thats the same amount of time of a money order.

[lowriderman3]

That wouldn't be a problem, but once you say you accept "Paypal," your going to have alot more problems with buyers that want to use their credit card funded paypal payments, and not just bank accounts. Plus bank account take 3-5 business days, and thats the same amount of time of a money order.

Yea I know that would make some sellers find elsewhere to shop, but you would just be trying to protect yourself on eBay and such....It would be the same as not accepting Paypal basically....Also are you talking about an eCheck that takes 3-5 days? If I pay you and fund it with my bank acount, the money is an instant transfer immediately upon me clicking the pay button. I do it all the time.

[Pick-A-Part]

Most people that use paypal with bank funded sources have ONLY a bank account - so they cannot use instant transfer. Thanks

[quarky42]

If anyone finds an alternative that lets you receive money from someones bank account AND credit card... that doesn't charge more than 3% to receive and doesn't charge a yearly or monthly "service fee" to setup and use... then I'm all ears.

I'd love to use something different but they are cheaper than anything else I've seen. You can raise your prices some and use some sort of payment gateway service...that's the only other option I've seen. (and by some it is usually between 6% and 8%.

[Pick-A-Part]

http://www.auctioncheckout.com/ - depending on volumn. We accept credit cards direct through a merchant, but we also do over $100,000 in sales every month.

[1badgto]

i dont need no stinken pay pal lololol i'm 20 minutes away he he he and you guys know me by name lol i'm praticly family :welxcome: guys nice to see ya got on the lx train these guys here rock :beerchug: :beerchug:

[bucke77]

sounds like you dont want to pay the paypal fees

[catzcradle]

I've had no problems, and I'm sorry, but I'll not give out CC info over the phone to anyone. I'm sorry for your troubles, but my wife and I have used paypal for going on 5 yrs without a problem. I won't buy something on ebay from someone who doesn't accept paypal.

Also, don't you run into the same problem when someone fraudulently charges a CC?

[Pick-A-Part]

No, because credit card companies do their own investigation and don't debit our account. Also, we've only had 1 fraud attempt via credit card in 2 years, as opposed to paypal fraud every few weeks.

And to bucke77, the rates via credit card and paypal account are identical.

[Fred]

Money orders: Cash them, don't deposit them! Same for any check that you can find a local branch within 1/2 hour. When I sell on ebay, I specify that I will only accept a money order form wester union or the USPS, a check with a one week waiting period AND "depositor's bank MUST have a local branch in Suffolk County, NY" - this only applies to really small orders and if there's some odd reason they don't want to use a money order, but even then, the last time I got paid with a check was over 3 years ago. I now usually specify also accepting certified/cashier's/teller's checks. They generally cost around $10 and if it is a large enough order, well the $10 is less than paypal would take out in fees anyway, so I let the buyer deduct it from the total. When I take it to the bank, I specifically tell the teller "no I do not want to cash it against my balance, I want it ran through the system properly to make sure it is legitimate. Here's my number to call when I can pick up my cash."

I do accept paypal, but only for people with verified accounts, and then I ship insured with signature confirmation. If the the funds were sent fraudulently, meaning "the shipment was never delivered to the person's funds who were used to purchase the item", then the insurance covers it. I do not see how paypal would let you add a gift card as a VERIFIED and CONFIRMED source of funds, in which the seller protection would actually apply.

The only time I lost $500 out of a $3000 transaction was when a customer filed a charge back through amex. I am not sure if the 500 was my deductible from the protection or that was all that was filed for, as it was a "not as described" claim, for a 12 year old Cadillac Eldorado, in which the sale was set up a little suspiciously, and the actual buyer wasn't there to take delivery, but it went to a stereo shop. I said that the car had been available for inspection prior to purchase, but hey, I learned an important lesson from that. I know amex is really easy to file for charge backs, I know because I have used it in the past. Basically if the cashier proverbially "sneezed" during a transaction, and you file online, you have your money back in a matter of weeks.

[Pick-A-Part]

Excellent information.

[Inked*Gamer]

So what your saying is that if there is no money in the paypal account, you just have a negative balance on there. They don;t go after it in your link checking account? I sold some stuff a few months ago, and the buyer said that the item was damaged. I told him to send it back to me and I would refund the money back to them. They never did, but paypal still froze the funds in my paypal acct. What I worry about is if this happens again, and there is no balance in the paypal account can they go into my checking account?

We've thought about this, but that doesnt change the fact that if someone has someone else's money in their active balance, they can still use that to pay for any item. Then when the original person that got ripped off files a claim, it limites the fraudlent account, and reverses all charges sent or received. This still gets us.

I use paypal once in a blue moon to PAY for an item on ebay, using only my credit card. There is no doubt its the fastest way to make payment, just not the safest.

I also keep my account at zero. Atleast this way when they issue a chargeback, it just makes my account go negative, and paypal doesnt send negative accounts to collections. You just have to open another.

Keep in mind this is not a personal attack on anyone or any service, we simply wish to inform our friends and customers at LXForums so that they may learn from our mistakes.

[SmoovC]

Other than for people on this forum, I ALWAYS hold shipment until my bank verifies funds are received.

[Pick-A-Part]

They cannot take money out of your checking account to bring your negative balance to zero.

[lowriderman3]

Even if you received a money order and then cash it, and it comes back to be stolen/counterfiet, you are still responsible for covering it....If someone is out to be dishonest, there is always heartaches on your end, whether Paypal or not. That is American today! Sellers who do not use Paypal on eBay gets bypassed by me in a heartbeat.

[Greg095]

I know this thread started a while ago, but I just came across it and I know EXACTLY what you guys are discussing. I am going to give a plug to my company, as shameless as that is. I am a fraud analyst for www.bidpay.com. We are the only other credit card processing service that is recognized by eBay. We offer competitive seller rates (2.5% plus a .50 fee, per transaction). The major difference between BidPay and PayPal, is we don't hold an escrow account like PayPal. We process the payment from the buyers credit card and deposit the funds directly to the sellers personal bank account that they have set up on their account. We offer better seller protection that paypal.
We work with the seller to resolve any disputes that may occur. And since the funds are deposited to the sellers account through the ACH (automated clearing house) of the federal reserve, we don't "freeze" the funds. Its a great, and better alternative to PayPal. Any sellers out there, whether its on eBay, Yahoo, overstock, or most other major online auction sites that have any questions, please feel free to PM me. You can also
check us out at www.bidpay.com.

[Pick-A-Part]

I use bidpay for my personal account to pay for 75% of the items I buy.

[Greg095]

I use bidpay for my personal account to pay for 75% of the items I buy.

Sent you a PM. Let me know if I can help you out setting up a sellers account.

[BUTWEET]

I have never used Paypal and never will. Period!

[izzyplayer]

same thing with me, i sold my nav system thru ebay, the guy got it and 2 weeks later he tells me my unit doesnt work, bunch of crap, so he sends a complain to paypal and now my account is negative bc like you said they cant take money out of my account, but then i email paypal and they told me pretty much too bad and that i had to pay the guy the rest of the money even though he never said anything about returning the nav or anything else, paypal realy sucks, i just dont like it, i agree with you butweet, i might look into bidpay instead

[lowriderman3]

same thing with me, i sold my nav system thru ebay, the guy got it and 2 weeks later he tells me my unit doesnt work, bunch of crap, so he sends a complain to paypal and now my account is negative bc like you said they cant take money out of my account, but then i email paypal and they told me pretty much too bad and that i had to pay the guy the rest of the money even though he never said anything about returning the nav or anything else, paypal realy sucks, i just dont like it, i agree with you butweet, i might look into bidpay instead

So you are saying you had to give him his money back without him returning the unit? So he got your unit and his money back? This cannot be true, unless I am misunderstanding what you are saying.

Also if a payment is funded by a Credit Card, no matter what service you use, they can do a charge back through the credit card and the service you use, is helpless. I have been using Paypal for 8+ years..I sell on eBay like crazy...Never had Paypal treat me unfair, but I know it happens, as with any service oriented business.