Instantaneous chargebacks with no time to dispute

[kj62]

I had 14 chargebacks from the same client for the last seven months of a subscription.  These were disputed on 2/1/19 as "unauthorized", verified by PayPal the same day (in violation of PayPal's 7-day resolution period), deducted from my account, and closed -- before I even saw the emails.  I reached out to PayPal on the Resolution Center (on 2/2), and have heard nothing.  There's a ton of evidence that these ARE authorized by many emails to/from the client.

As it turns out, the client's credit card had been hacked and they hurriedly went through their statements and disputed anything they didn't recognize, which unfortunately included me.  They are immediately sending me a check.  But if they were not ethical people, I would be out $2,400 because PayPal ignored their own dispute resolution procedures.  More than likely they would have ignored all the evidence as well.

I'm rightfully afraid now, knowing that any client can reverse any charge going back into ancient history.  Just a few unethical people could bankrupt me, and I apparently have no protection from PayPal.

[kernowlass · Accepted solution]

@kj62

a chargeback is not a paypal dispute, it is done directly via your buyers credit card issuer.

that card issuer makes all the decisions and all paypal can do is pass on any information on your behalf.

if the card issuer found in their clients favour then of course they would be refunded.

however you would not miss out either if you met ALL the requirements of seller protection.

however seller protection does not cover virtual / digital content, you can sell them but at your own risk.

luckily you had an honest buyer.

[kj62]

Thanks.  With PayPal acting as a credit card processor, how would you even know what credit card company to contact to initiate a dispute of the charge back?  I think I'm safe now since my target audience is extremely limited to people that I have contact with through other means, and I updated my Credit Card Statement Name to reflect the website rather than my company name.  My client's mistake of not recognizing the charges should not occur again.  I wouldn't want to sell digital content to the general public without some form of charge back insurance -- a concept I just learned about from this incident.

[kernowlass]

@kj62

To initiate a chargeback you speak to your OWN credit card company.

The buyer would know what credit card he used to fund his paypal payment and would contact them to do a chargeback for him against you.

[Dianne10]

How can PayPal prove that a buyer is scamming and defrauding their own financial service when paying on credit card? It appears many are receiving goods and then making claims after 3-6 months causing chargebacks.  Sellers can follow the correct cover by providing "shipping proof " but it doesn't seem to win in all cases.   Real scamming going on around the world at the moment .