E-Bay and PayPal: What should I know?

[John Layton]

I got horribly scammed many years ago (early 1980's), as did quite a few others...by a fake business calling themselves "Studio 21," which took advantage of an apparent loophole made possible when equipment was sent via. UPS to this "business" with a collect on delivery (C.O.D.) agreement. The "check" (fake document) given to UPS would take its good time to get back to myself and the many other victims of this scam, all of these checks arriving, being deposited, and bouncing...after the date which "Studio 21" magically ceased to exist.

I hired a lawyer (contingency basis, thank goodness!), and the Pa. AG's office and the FBI eventually got involved also, with myself and the many other folks scammed in this case - but nothing ever came of it...the bad guys won. I was out about six thousand bucks, and tried to convince my insurance company that since my equipment was never legitimately purchased from me, that I still owned it and thus should be covered under the "stolen equipment" clause. They argued otherwise as my intent was, indeed, to sell...and my lawyer convinced me that they were probably right.

These days I'm extremely cautious...especially about selling equipment. I typically will only sell to folks who've had a good history on this forum, and encourage email and/or phone contact as part of the process, and I never use PayPal or eBay, which I know has caused some inconvenience and some missed sales opportunities...but so be it!

[goamules]

For the long-time ebay policy of sucking refunds out of your bank account, I also set up a special account at my bank. I told them to NOT transfer any over drafts or give me instant line of credit on that account, because on my main account they "protect me" from overdraft charges by doing that. It's worked for over a decade. When I get a payment in Paypal, I transfer it over to the "fun account". Then I transfer it over to my "real" account. It only takes a few logins and minutes.

I used to keep a balance in Paypal so I could buy more things, after I sold some. But that changed. One thing to know about Paypal is you cannot easily maintain a balance anymore, unless you buy their credit card. That was the latest shock about 6 months ago when I did a rare sale. After payment by the buyer, it said "you have funds!" but I didn't SEE them. You have to "get funds" or something with a few buttons, and it automatically transfers to your bank. It won't just "sit there" in Paypal anymore. Unless you sign up for their credit, which I'm not about to do.

[Bob Salomon]

For the long-time ebay policy of sucking refunds out of your bank account, I also set up a special account at my bank. I told them to NOT transfer any over drafts or give me instant line of credit on that account, because on my main account they "protect me" from overdraft charges by doing that. It's worked for over a decade. When I get a payment in Paypal, I transfer it over to the "fun account". Then I transfer it over to my "real" account. It only takes a few logins and minutes.

I used to keep a balance in Paypal so I could buy more things, after I sold some. But that changed. One thing to know about Paypal is you cannot easily maintain a balance anymore, unless you buy their credit card. That was the latest shock about 6 months ago when I did a rare sale. After payment by the buyer, it said "you have funds!" but I didn't SEE them. You have to "get funds" or something with a few buttons, and it automatically transfers to your bank. It won't just "sit there" in Paypal anymore. Unless you sign up for their credit, which I'm not about to do.

A few years ago I sold something on eBay and got that “you have funds” notice. I had assumed that it went into my bank account as it had in the past. So I added the funds to my checking balance. A few days later my bank sent me an overdraft notice and they had no record of a transfer from eBay.
I called eBay and they told me that an account had been set up for me with PayPal and that is where the funds went.
I called PayPal to have them send the money to my bank. They said that since I had a new PayPal account that they could not transfer the funds for 30 days! I blew up! Spoke to a supervisor after supervisor till they escalated the call to a VP. He agreed, finally to immediately transfer my money. Especially after I asked him why they would not pay interest on my money that they planned on keeping for a month!
I then went to my bank manager, explained what happened, she credited back overdraft charges, made sure any outstanding checks would be honored and then said that she has had several other PayPal problems like this.
Have not sold or bought anything on eBay since or used PayPal! They certainly don’t act like anyone’s “pal”!

[goamules]

Don't get me started. My 79 year old mom decided she wanted a Paypal account so she could buy on ebay, against our advice. So she did it without telling us. Didn't buy much if anything. 6 months later she was confused and while trying to buy something, she logged in and noticed problems. She updated her address to her home address. About a month later she got a letter in the regular mail and called me. It said "you have not paid your balance in a while, please pay." She called me worried.

Sure enough, someone had hacked her personal information, and had been buying things in "her" name for the past year. They even were paying the minimum balance due each month so it wouldn't be turned off, and accruing about $4,000 in a revolving account. They'd changed all the addresses and contact info from my mom.

We immediately called them, it was a nightmare. We involved the credit Bureaus, the local police department and made a identity theft claim. Paypal fraud support (actually Synchrony bank that they affiliated with) went from saying "don't worry mam'me it will be fine....we've locked it and you won't owe anything..." To "you are lying, we know you were paying the balance and buying the items..." They were buying software items from Hong Kong sometimes 10 times a week. Right, my mom. And they were paying from a different state and address. Right. I had to deal with it in dozen's of phone calls and emails, sending power of attorney several times that they would "lose", and finally involving the State DA. TWO times they denied her fraud claim, but didn't give any reasons, just a form letter and nice statement "be sure to pay any balance due!" It kept her awake at night, it raised my blood pressure. I'd call and demand answers, they would "start a new claim" then you'd get the same reassurances it would be ok. 6 weeks later, she'd get a "Claim denied...pay your bill" letter. I finally started using social media to blast Synchrony Bank telling the world. They'd ask to call me and "what can we do to make you happy?" type calls. Um....recognize my mom was a victim of fraud and immediately clear her. "we can't do that, we'll open another fraud claim for you..." This finally was resolved about 2 months ago. She is cleared. BUT - don't even THINK of applying for the Paypal Credit. It's toxic.

[Jim Noel]

These accounts are not unusual. I have for years stated I would not buy if I had to use Paypal. I broke that rule recently ,but will not do so again. I have directed my wife to close her Paypal acct which I Have used .I only pay with USPS Money Orders, and will only sell if paid in that manner.

[Corran]

Most likely no one will buy from you then. I certainly wouldn't. Why should a buyer take such a flagrant risk, using a MO with no recourse if someone dips?

[drj52]

Most likely no one will buy from you then. I certainly wouldn't. Why should a buyer take such a flagrant risk, using a MO with no recourse if someone dips?

I’m still hung up on the “directed my wife” part.

[BrianShaw]

I’m still hung up on the “directed my wife” part.

He may have said it but I don’t believe she complied until she decided on her own...

[Alan Klein]

I sold my car last year and advertised on a couple of car sales sites. Both warned me to watch out for fraud. If the deal smells bad in any way, don't get involved. Don't sell to out of state buyers. They're usually phoney because why not get a car where you live? (Obviously different than rarer camera equipment). Don't deal with agents of prospective buyers. Lot's of Russian con artists. Be aware. I had one woman with a Russian accent who said she'd send her friend as she has to go on a trip overseas. I said thanks but no thanks. Accept cash only. Even certified checks can be phonied up. When you go to cash them, they bounce. When I sold my car, I met the guy in my bank after he drove the car and we agree on price. We closed the deal in a room the bank officer gave us for an hour where cash was given and I immediately deposited it before leaving the bank. He got all the signed papers and we all left happy. The only time I would have accepted a certified check is if it was drawn on my bank and I could deposit it and clear it at the same time the papers were signed. Since he had a different bank, I told him I would only accept cash.

[Jody_S]

For those who want to protect themselves at all cost against any possible type of fraud, consider that your local convenience store could easily stop shoplifting by allowing customers in one at a time and searching every single one as they left. But they don't do that, because legitimate customers don't like being treated like criminals and will simply go to the store across the street. If you make it a business, or a serious hobby, of selling, you cannot refuse the normal conventions of buying and selling without seriously hurting your business. If you have a one-of-a-kind rare lens that everyone wants, yes you will find someone to buy it on your terms, but otherwise you're only getting the people willing to jump through hoops for the sake of a bargain. Because your stuff is only going to sell at bargain prices.


-my apologies for accidentally posting this on an image thread

Not to worry, all cleaned up. -- Oren