Fraudulent Charges with a Side of Missing Funds

[FailMorePlease]

Allow me to briefly recount the tale of how I came to loathe PayPal. This is less a request for assistance and more a general warning to those considering the use of PayPal for any purposes other than to accept payment for eBay auctions (this function, I must say, has worked for me rather flawlessly). Well, a couple weeks ago I recieved a random alert from my bank reporting that some "conspicuous charges" have appeared on my recent transactions list. Curious, I rushed home and checked what exactly the nature of these transactions was and found that five consecutive payments of $50 had been made from my PayPal account to iTunes. Luckily, PayPal in their brilliance had managed to stop the last of the five fraudulent payments using their quick wits and penchance for customer service. It appeared, from the message that greeted me when I logged in, that the team at PayPal were very proud of themselves for having saved $50 of my $250 in fraudulently transferred funds.  

(The nature of this scheme is detailed here: http://discussions.apple.com/thread.jspa?messageID=13218188)

Furthermore, just to be safe, they had locked my account and required me to re-authenticate it by entering the answers to my several security questions, etc. Amazing! Except that none of my answers, which I remembered perfectly, worked. I had to call customer service and wait for around half an hour to get a representative with a very loose grasp on the English language, for which I do not hold her personally accountable since she is just doing her job. The interesting thing, however, was that my security question answers did not match because they had apparently been changed by some other party, the identity of whom she either could not disclose or did not know. If some random nobody has the ability to change my security questions at will without confirming their identity, how secure are they exactly? 

I digress. PayPal did eventually grant me the remainder of my money back and I was pleasantly surprised (as much as one can be having gone through such an ordeal), to find that there was a $200 credit on my account last Friday. Finally, this was over. Oh wait, this is PayPal, it's never over. After submitting a request to transfer that $200 credit back to my bank account, I waited for three days with absolutely no mention of any progress on the transaction. The $200 credit had disappeared, but my bank account had not yet been credited. When I contacted my bank to ask if there was perhaps some hold up on their end, they maintained that there was absolutely no record of any incoming transfers within the past four weeks. Interesting. I was slightly disappointed in PayPal's timeliness, but was still confident they would get the money successfully transferred in their own sweet time. This was on the 26th. This morning, I checked my accounts once more to see if any progress had been made and shouted with elation as PayPal reported my $200 transaction had been successfully completed. Wells Fargo, however, firmly disagreed with this assertion and further maintained that there were no pending transfers or transactions to any of my accounts. PayPal now refuses to address my complaints through any channel be it the numerous emails I have sent to the support staff or the countless phone calls (and even more inumerable hours spen holding) I've made requesting an update on the situation. So here I am. I've all but given up hope I will ever see my hard-earned money again and just wanted to make people aware what they are likely getting themselves into should they ever use PayPal to, well, pay for anything. 

[gingerbee]

I just want out of paypal! It seems as though some enity has taken over, They have no way of me contacting them, I only started on paypal b/c i saw something @ ebay i wanted, now I can't get disconnected fr them! I just paid every penny I owed them, now i still can't find a way to close this account with paypal. Help anyone? Thanks, ginger

[PayPal_Olivia]

Hi FailMorePlease, and welcome to the forums!

I'm very sorry to hear about the experience you had with unauthorized access on your account. It's frustrating to know how creative, resourceful and sophisticated spoofers are getting with their ability to socially engineer or guess passwords, and research the information that people might use in their security questions. There are some measures you can take to create strong passwords and protect them.

Click here for more information about password safety. 

Another tip that I have learned over the years is to make sure that any information you use for security questions is information that you have never disclosed anywhere. For instance, if you blog about your cat, never use your cat's name in a security question. The internet has a long memory!

PayPal diligently employs fraud protection measures to prevent unauthorized access, and fraud detection measures to catch it quickly. In situations where the unauthorized access could not be prevented, we have 100% coverage on unauthorized transactions after review, which you discovered. I'm glad (but not surprised) that your case is resolved and your refund was issued!

The transfer of funds to and from US banks takes 3-5 business days. When you click withdraw, the screen that comes up shows all of the withdrawal options and their timeframes. The reason why bank withdrawals take 3-5 business days is that all money between PayPal and banks is moved using the ACH process, under the oversight of NACHA - The Electronics Payments Association. This is a batch processing method used by many financial services to keep operating costs lower and therefore keep fees lower for customers. The cost-effective use of batch processing even allows PayPal to offer many services for free.

When did you initiate your withdrawal to your bank? Was it Friday the 18th, or Friday the 25th? Anything initiated before 3/22 should probably have cleared to your bank by this time. Anything initiated after that date is likely still in transit and should show up soon.

Please let me know what happens. I'm confident that the dust will settle shortly and you will see your refund. If you don't see it and it's been 7 business days since you initiated the withdrawal, give Customer Solutions a call to take a look. You can get the number by clicking "Contact Us" on the bottom of any PayPal page, and then "Call Us". You can log in and get a webpin to breeze through validation, or you can click continue to get a number without logging in.

Olivia