A serious issue with PayPal, what can I do?

Fig-D

First, I just want to mention that I originally had nothing against PayPal or eBay. I was scammed by someone using their services, and I realize that that is not their fault.

I don't really feel comfortable discussing what I was purchasing or how much it was, but let's just say it was an expensive gift. Nothing illegal or doesn't have a bunch of other listings on eBay, it cost enough money that it will take me awhile to get that kind of spending money again.

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Here's the timeline of what happened:

Day One (6/12) - I agree to purchase the item, I send my money through PayPal, and I receive an email from the seller with a UPS tracking number.

Day Two (6/13) - I get an email from eBay's Loss Prevention Department‏ telling me that the listing as been remove and that this action is suspicious, I also receive an email from PayPal stating the same thing and that they have begun investigating the transaction. This is a direct quote from the email: "As a result, we have placed the transaction on hold until we complete an investigation." I thinking "thank God, somebody tried to scam me but PayPal is on top of this shit." I check the PayPal Resolution Center and the claim is indeed there and ongoing. I go to eBay and discover that the seller's account no longer exists. I check my online banking and the payment has not left my account. I think I'm good.

Three days later...

(6/13) The amount of the auction is deducted from my account, by PayPal. I start flipping out. I check the Resolution Center and see that the original claim is still under investigation. I fill out another claim in which I tell them that even though they told me that my transaction was on hold, they removed the amount from my account anyway. I'm told to wait until the investigation has been completed. I check the seller's PayPal account, it no longer exists.

I wait, as I've been told...

Yesterday (7/4) - I receive an email from PayPal stating that the claim has been decided in my favor, and that 2/5ths of the amount I originally paid would be credited back to my PayPal account. This did happen, and it says that the $200 is "From" the original seller. The email goes on to say "This case is closed. No further action is required by you at this time."

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Now I'm placing a large part of the blame on PayPal. They told me that they would put the transaction on hold, but three days later they take the money out of my bank!

What can I do? I'm so pissed off right now that I can't even think strait.

mspencer

First, realize that ACH debits (electronic checks, in a way) CAN be reversed if they were unauthorized. I work for a bank but my job doesn't require me to know NACHA rules front and back, so this might be wrong -- but I believe you have 30 days for consumer DDAs (demand deposit accounts, which is what fancypants bankers call a checking account) and only one or two days for business DDA's.

I'm not saying do this, but you should realize you have this ability. If you do this the debit funds will be returned to your bank account, and PayPal is prohibited by NACHA regs from just going out and taking the money again. They MAY be allowed to use any other methods of payment you have on file, like Visa or Mastercard accounts, so you may want to block those if you're going to go this route.

Also keep in mind that if you do this, PayPal is not going to be your best friend any more. They may consider you to be in breach of some user agreement, and they may not let you have a PayPal account again any more. I don't know.

Also, full disclosure: PayPal is a direct competitor to the company I work for (although they handle consumers and 'micro merchants' and most of our customers are 'small to mid' size merchants and up), but I have no personal wish to see them come to any harm. I'm pretty clueless about them or their policies, but I DO know a fair bit about banking.

Edit: to be clear, what I'm talking about is going and talking to a banker in person and saying "this company took this money from my account without my permission. Yes I do business with them but this specific debit should not have happened and was not authorized," and the pros and cons regarding deciding to do that.

Sir Red of the Manti

Chargeback if you used a credit card, otherwise print out some copies of everything Paypal has sent you along with bank statements proving the timing of what went down and get some legal assistance.

wasted pixels

Here's an important detail you've left out: do you have any information about the seller? You ARE in a binding contract with them, and from what you've implied, they have 60% of your money, but HAVEN'T delivered on their end. If you have any information on them (name, address, number), consider a small claims action against them.

Fig-D

wasted pixels wrote: »

Here's an important detail you've left out: do you have any information about the seller? You ARE in a binding contract with them, and from what you've implied, they have 60% of your money, but HAVEN'T delivered on their end. If you have any information on them (name, address, number), consider a small claims action against them.

I've got a name and email, but that's it. I can't seem to find a "find user" button at PayPal.

I don't really want to dispute it at my bank because I'm afraid of any sort of breach of contract bullshit being dumped on my head, but I'm getting more and more pissed off at PayPal about the hold thing as time goes on.

Crashtard

Breach of contract with who? Whether you're worried or not, you NEED to go to the bank and deal with this. You can't just let them take your money. Do what needs to be done and consider it a lesson learned.