Fraudulent $1 donations to nonprofit

[Shores2017]

 In the past month we have received 6-8 $1.00 (or slightly more) donations. We immediately receive an email from Paypal that a case has been opened and we should respond in the resolution center. Before we can check on it, it's been reversed. All but one appeared to be fraud because the person's name and the email used appeared VERY different. In one case, the paypal account owner contacted our nonprofit asking why we charged her $1. I explained we are a nonprofit and receive donations but do not charge people or initiate payments and advised her to contact paypal. She did and was on the phone for an hour with them. Then went to her bank to find out who this was that 'took $1' from her.

How do we protect our account from this happening? What does paypal do with repeated fraud incidents? We certainly don't want our nonprofit to suffer or get a reputation that we do this!

[Quandary]

There's really nothing you can do to stop what is happening - it would appear that someone is testing credit cards to see if they are valid - they use the card to donate a $1 - if it goes through, they know they have valid credit card number.   You may have one option work around using PayPal's authorization and capture feature whereas you could void the $1 donation however, it would envolve monitoring evey transaction.  See this info.

[Shores2017]

The one transaction was using the person's bank account, not testing credit cards. Seems to be more to this than just testing credit cards. We've used paypal as a part of our nonprofit for over 7 years now and this is the first anything like this has happened.

[kisujo]

We too are getting numerous fraudulent donations.  I am refunding the credit card transactions as well as the e-checks (once they have cleared).  We're trying a "I'm not a robot" button on our Donate page, but I'm not sure that's doing any good.  It's frustrating that we have to do all this work to initiate the refunds.  PayPal has not offered much help on their end - it's all on us.