Credit not processed Chargeback dispute - any experience here?

[richdmz]

Good Morning,

I sold an item through eBay and the buyer requested a return. I accepted the return and provided a return label however the buyer used his own label and the tracking shows it was delivered to the wrong address. Buyer opened a case with eBay and it was denied due to tracking show that it was not delivered to me.

Buyer filed a credit not processed claim with his credit card which in turned opened a case with Paypal. I provided the details to Paypal with the details of the eBay case showing he never returned the item. Paypal says I am not elgible for seller protection, debited my account and is waiting for the credit card company's decision. 

Has anyone worked through a case like this? Any tips or recommendations? I am concerned that I am told I am not eglible for seller's protection when I delivered the item with tracking/signature and the item was never returned. I am also concerned if Paypal is accurately representing the case to the credit card company. I appreciate any help or suggesstions.

Thanks,

Rich

[DPCreations]

Credit card companies have very different rules about disputes and returns.  

Do you know the reason for the chargeback claim?

Credit card companies are not likely to require product return.

Did PayPal stat why you were not eligible for seller protection?

What was the product?

Does tracking show the product was originally delivered to the buyer?

[richdmz]

The chargeback was for "credit not processed" which means the buyer said he returned the item but did not receive the credit for it. However I never received the item and the tracking # he provided shows it was delivered to the incorrect address.

Paypal provided this reason in the case which customer service confirmed

• This chargeback type was not covered under Seller Protection.

Product was a brand new video card $8xx.xx

Tracking shows it was delivered and signed for by the buyer.

[DPCreations]

Nothing you can do when the buyer files a dispute with the credit card company.  PayPal is the merchant and it is PayPal which has agreements with the credit card companies; this means that sellers are basically out of the picture for dealing with credit card disputes.  That's when PayPal seller protection is important.  (If you want to deal directly with credit card disputes you need to open a merchant account with a company like FirstData for processing your payments.)

Dealing with returns is outside the scope of PayPal seller protection when it is outside of PayPal decision-making.

Electronics are extremely high risk for fraud by both sellers and buyers on the internet.  From a practical perspective you sell such as your own risk.

I don't know what options you had to negotiate a deal with the buyer BEFORE the buyer filed a dispute with PayPal.  Generally it is better to resolve issues privately rather than have PayPal involved.  Failure of a private settlement which pushes an angry buyer to submit dispute to credit card is the worst case for sellers; credit card bank greaatly favor buyers with disputes.

It's all part of understanding the business world.

[richdmz]

Thank you for taking the time in responding. I been selling on eBay since 2004 and understand there will always be risk in selling. I tried mitigating this risk by accepting his return and providing a prepaid label. The buyer choose his own shipping method which ended up in an incorrect delivery. I spoke to USPS who was the carrier he used and they opened a case and said they would refund the buyer up to the insured amount he elected. I just want to ensure I mitigated my risk with the chargeback case as much as possible knowing that there is a good possibility of the credit card company siding with their client even through the return was never made with proof backing this up.

[DPCreations]

I think you did all you could; it ended up being outside of PayPal's control.

Accepting returns is high risk for sellers as so much uncertainty is placed in the hands of the buyer.  Buyer can return junk or fake items.  This was an unusual case where buyer selected a different shipping method.  Was there a delay in getting the pre-paid label to the buyer so the impatient buyer decided to pruchase private shipping?  Do you think the return address was incorrect intentionally or malicious?

I'm just curious as a matter of learning.

Here's my take on what to do when a buyer is unhappy and I have a chance to deal with the buyer BEFORE any official disputes.  I look at the potential business cost and risk and make a least costly decision, even when it means a significant cost reduction refund to buyer.  I realize that the risk of return is high and can be costly.  I can get a defective item returned and have no chance of any recovery while the buyer gets a total refund.  It may not be fair, but business isn't about fairness to seller.  I also will phone the buyer to determine the real issues and then work out deal.

I used to work for a large company and got invoved in phone calls to retail buyers when the regular customer service department got exasperated.  I learned that talking to customers can be a good thing.

[richdmz]

The label was provided before the buyer used his own label. The buyer was a new eBay member with 0 feedback and closed his account shortly. I am not sure if the intent was malicious or an eBay buyer who was new to the process and it was just coincidence that it was received and signed by another individual at the wrong address. The buyer also had poor communication during the process. 

Looking back there is always room for improvement on my end so I will keep this lesson learned in the future. I also thought of some action items for myself.

-Going to contact USPS and follow-up on their investigiation

-Contact the address that received the item (it was shipped to a bank in the area) and see what happened to the package

[DPCreations]

What carrier was the buyer supposed to use with the provided and paid label?

My guess is that it was not malicious since it was sent to a bank.  Unless the buyer has a buddy working at the bank.

Since the buyer used USPS any refund would go to buyer so the buyer would get double money, I think.

As for the bank, that seems like a good option as one would expect those people to be honest.  You may already be too late, though.  An honest bank person could just return to sender thinking it was all a mistake; that might have already happened.

You have nothing more to lose with the attempts and you'll learn a lot how to work on a future problem you hope to never have.

[richdmz]

I sent a prepaid label using UPS which was fully insured. The automated USPS system said the case was resolved so I have an inquiry in to see the findings. Inquiry in with the bank as well.

[DPCreations]

Here my opinion why USPS was selected rather than UPS by the buyer.  It was much more convenient.  My guess is that the buyer would have been required to drive to a UPS dropoff location compared to home pickup by USPS. 

I'm not familier with the eBay-provided UPS label.  In my opinion it should allow the buyer to phone UPS for local pickup.  I'm thinking from the buyer's perspective.

Following this scenario might also mean that the buyer was familiar with Priority Mail and scheduled pickup, meaning a very knowledgeable buyer.

Lot's of interesting speculation with no change in outcome--just idle curiosity at this point.