Heya there! I help run a virtualware business where we sell online game items and we've experienced our share of chargebacks, frauds, and the like. Officially, PayPal protects neither the buyer OR seller when it comes to transactions involving intangible goods. As such, there are only two ways someone can charge back on you. 1. They make the charge through their credit card, call up their company, and have the charges reversed (I believe this is the most common way it happens, since it's the most likely method to actually succeed). 2. They make an Unauthorized Transaction claim; this can happen either because the PayPal really DID happen to be stolen, or because they're trying to fraudulently claim it was stolen to get their money back. Generally, if you have any doubts about making a transaction, I'd recommend asking to talk to your buyer in person on the phone. Most frauds trying to steal virtual items don't want to talk to a real person; one, it becomes too personal for them, two, you have their phone number if anything goes wrong. For very large transactions, I generally request that a buyer send a scan or picture of a valid ID such as a driver's license to me (I allow them to block out all information aside from the name and address). That way, if they do attempt a chargeback, they'd have to somehow demonstrate that whoever stole their PayPal info also stole their driver's license; not very likely! Safe selling to you. 😉
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