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Here's a good PayPal comment on the forum:
This also happened to me. I sold something on ebay, the buyer had low feedback but the money was there in my account so I sent the Cd key for the game. Now PayPal have sided with the scammer and I now know (too late) that seller protection is a joke. They also hit me with a $15 chargeback fee!
PayPal have got too big and now they do not offer the seller protection they promise. Going to look at regulatory bodies to see if they need to stop advertising their seller protection.
Sorry to hear you're having issues, but it's actually pretty clear in PayPal's Seller Protection details that digital goods are not covered. So you sold something that isn't covered to a buyer that did not have much positive history. I would chalk it up to a learning experience. You would have the same issue with any other payment processor, too.
I am a victim of PayPal's false advertising of seller protection.
I shipped products signature confirmation, provided proof buyer changing accusation/story 3 times, proof of receipt of the products when I purchased them from reputable dealers and even video footage of packing and shipping that was filmed due to the price level of this transaction as a precautionary measure. All details of proof match the pictures in listing and description provided in listing. Serial #'s and all. In the end, it doesn't even matter. The buyer threaten to get the FBI two week ago(sent that screen shot to paypal). I am still waiting.... All that is left is civil suit. For me to spend even more money.
In the end no form of evidence/proof matters. SELLERS BEWARE! I lost $5,720 thanks to PayPal false advertisement. Buyer has the money now (instant reversal) and my property.
True colors has shine through.
You know, this makes me question why PayPal charge the high fees that they charge. If we can’t get protection, then what good is the service? Apart from able to accept card payment easier. But I can do that on the revolut app for free. People can also send me money to my bank for free. I think it is time we all start accepting crypto payments. Then no reverse charges, and they have to deal with you directly if they have a problem. It will resolve the scammers buying goods. But not selling goods.
It seems that I have become an addition to this list of victims however, my situation is a bit different.
On July 21 2018 a customer purchased goods from my website and it was delivered on July 23rd 2018.
In November, the cardholder filed a dispute with their bank for the charges. Immediately, we contacted the customer and was then advised that
1. The card did not belong to him, but he did have permission to use it
2. The card holder and himself had a dispute which resulted in the card holder filing chargeback claims on transactions relating to him
Due to our location, we do deliveries ourselves and collect signatory proof on delivery - tracking is not available. I explained this to the PayPal representative when the dispute was first opened and they acknowledged that this was ok.
Not only do we have signature proof, the customer is also confirming that they received the items.
As a seller, should I be responsible for a dispute between the customer and the cardholder? Should I now have to go through an entire legal process with the customer since they are claiming that they do not have the funds to pay for the goods?
From my experience, when a card is added to a PayPal account, the account needs to be verified by uploading a credit card statement and Photo ID before any purchases can be made. What is the purpose of this if I am being held responsible for a chargeback?
Where exactly is the Seller Protection?
If I have the customer confirming that the goods were received, then why not apply the chargeback to their account?
Same here. And it's even highly likely in case of digital goods.
I worked for 2 weeks on buyers request. Buyer paid 30% , I sent a partial file to review and check. Then I asked for full payment to send the full file.
Then buyer demanded that file be sent first. I refused to agree and she filed a dispute and PayPal refunded the amount immediately without checking this carefully.
I got a response that files were never delivered. Inspite of showing all proofs like mail screenshots and FB chats PayPal did nothing.
So buyer has now 70% of my 3D printable file. He can easily hire another designer and pay him 30% price and get it done.
My 2 weeks work,my honesty, my efforts nothing matters to PayPal as it's only interested in projecting an image before buyers.
This discouraged me from using this platform and I am also planing to quit.