paypal reversals - for services

[topr8]

hi there

have had a client who has had a couple of reversals from paypla payments for no-tangible goods ... eg they provided a service for the money.

has anyone had any experience of a successfull challenge in this situation?

i haven't used paypal myself (except as a buyer on ebay)

[Daldain]

You can automatically win on cases where the customer has claimed "Item not received" due to it being an in-tangible good. You can quote the PayPal terms and condition section for seller protection.

You will have a much harder disputing for "Unauthorized Use", it's up to you to provide proof that the buyer actually received the service.

[topr8]

thanks, that's helpful, proof of service should be possible.

[LifeinAsia]

It will depend on how they actually paid through PayPal- through funds or through a credit card.

We had an issue where someone paid through PayPal with a stolen credit card. Had a copy of the guy's passport and everything. PayPal obviously took the money back, then refused to follow-up to investigate the fraud.

The kicker is that years later, the account STILL is listed as a verified account in good standing!

Since then, we no longer accept PayPal as a payment option- the liability is just too high for us.

Good luck with your dispute with them. However, most likely they will hide behind their policy of only offering payment protection for tangible goods and suggest you try to get your money through other channels.

[jwolthuis]

most likely they will hide behind their policy of only offering payment protection for tangible goods

This is a bit misleading. The PayPal User Agreement (available from any PayPal page by clicking the "Legal Agreements" link at the bottom) specifically states that neither buyer- nor seller-protection is offered for non-tangible items.

They go on to say that "credit card" (not PayPal) funded purchases may include chargeback protection for the buyer for non-tangible purposes. I think the credit card companies are the ones hiding behind policies, not PayPal.

Your link between your stolen credit card issue and PayPal is not clear. If the stolen card happened to be processed by Authorize.Net, and Auth.Net still processed his stolen credit cards today, would you not use Auth.Net either?

[LifeinAsia]

This is a bit misleading.

The point I am trying to make is that they will hide behind that policy and refuse to take responsibility for their actions (like processing a transaction that had all kinds of red flags and continuing to give the buyer a status that indicates he can be trusted). They will also refuse to attempt to recover the money from the user's registered bank account or other source.

I never mentioned Authorize.net.

If you mean had I used Authorize.net instead of PayPal to process the card, and it ended up being stolen, would I continue to use them? It's a non-issue: if we were processing the card directly, it never would have happened- too many red flags (CC name didn't match the user, nationality didn't match billing address, very suspicious e-mail address). And even if it slipped through and did get processed, we would have had time to stop the services when notified the card was stolen. PayPal took 10 days after their "investigation" started before they notified us the reason was that the card was stolen- by that time, the perp was long gone.

[jwolthuis]

I never mentioned Authorize.net.

I know. I was simply pointing out that PayPal is a gateway (just like auth.net), when it involves credit cards (not PayPal accounts).

The same fraud indicators you mentioned are available when PayPal funnels a credit card payment to you, and fraudulent payments can be made via any gateway, as long as Visa approves it.

Your beef is with Visa, when they approved the fraudulent payment. If they had declined it, the gateway (PayPal) would have passed the decline on to you.

[LifeinAsia]

No- we never saw anything about the transaction until it was already processed by PayPal. In fact, I don't believe there was any information (until weeks after the fact) that the payment was funded by a credit card instead of the user's PayPal account. PayPal indicated (and continues to indicate to this date) that the account was verified and in good standing. We made the mistake in believing that they actually followed good business practices when processing credit cards.

I have never heard of a gateway that gives it's registered customers "verified" or not status.

Your beef is with Visa

Incorrect- PayPal acts as a 3rd party between Visa and us. As such, Visa wouldn't work with us directly and PayPal refused to get involved- as I stated earlier.

If the charge had gone through a proper gateway, the gateway would act as the conduit for disputes with Visa and we could have responded directly to Visa with the documentation we had. This is what currently happens with us when we respond to chargebacks or questions through our regular gateway. PayPal refused to pass on any documentation to Visa, nor would they provide any details about the transaction itself so that we could try to work with Visa.

As PayPal acts more like a wall than a gateway, we now refuse to use them for payments any more. Your mileage may vary, but caveat emptor.

[indyank]

jwolthuis - are you from paypal? It sucks so badly you know? It is high time people look for other alternatives..Recently several merchants are loosing business by having paypal as a payment solution instead of someone else. There are several payment processing errors being faced by customers on merchant sites when using paypal as a method for making payment and you customer support sucks so badly. Very irresponsible and so unprofessional is this company. It is time for paypal to die.

[oliondor]

2checkout is good also... when they accept your application !

[dpd1]

jwolthuis - are you from paypal? It sucks so badly you know? It is high time people look for other alternatives..Recently several merchants are loosing business by having paypal as a payment solution instead of someone else. There are several payment processing errors being faced by customers on merchant sites when using paypal as a method for making payment and you customer support sucks so badly. Very irresponsible and so unprofessional is this company. It is time for paypal to die.

Gee, could you be more dramatic and vague? LOL Why are you asking him if he works there? That's ridiculous. Please... The whole hysterical PayPal hatred thing is getting sort of old. It's like listening to the Mac haters. They're far from perfect, and I'm not saying they haven't ever screwed anybody over... But lots of the stories you see on eBay are far from being the full story. I've had them as one of my payment methods and started with just them, over 12 years ago. In that time I had maybe four issues that I wasn't pleased with. But they talked to me about it and it wasn't the end of the world. I imagine I would have been far more penalized by not having them. I've heard horror stories with just about every financial org there is. Last year I had one bank I had an account with (that everybody told me was so great) take $300 out of my account and called it a "tax letter fee". Yes, they charged me $300 to send me a tax form for the year, and took the money in October... Something most places do for free. So I don't care who you use... Eventually they're going to screw you over on something.

[HRoth]

Did they give you the money back for that fee?