How do you get scammed by paypal?

I noticed quite a few US sellers on ebay don't accept paypal from international customers as the address is always unconfirmed. They say they have been previously scammed so will only accept money order.

But doesn't the customer have to pay first b4 the shipping takes place? So how did the seller get scammed?

If the paypal account was created with a stolen credit card the phoney buyer can "pay" for it with the credit card based account and have the seller ship the goods. By the time the seller finds out the card was stolen the goods are long gone and the seller is ripped off. Some sellers are OK with International buyers provided the purchase is paid for with a bank account based paypal account. With one of these paypal accounts the buyer can't send the cash unless it's actually in the chequeing or savings account to begin with.

Ok I get the non cc-paypal account.

But for the CC-based one, the money is 'instantly' transferred to the seller then credited to the card owner. Seller sees the amount come in, then he ships the goods. Later when the CC is found to be stolen, the $$ is taken back? Isn't the loss supposed to be absorbed by the CC fraud department?

thanks for the tip.

I've done hundreds of successful transactions on cpf with many being intnl orders and rarely have any problems.

I'm starting to sell on ebay and naturally apreciate hearing about how these scams work.

point taken is cpf's a safe haven when compared to wide open markets like ebay.

Paypal does have some steps in place to prevent stolen credit cards from being used but these can't help if the ebay account was "highjacked" because a unsuspecting ebayer mistakenly replied to a spoof email that looked real but was actually a fake that requested credit card info.

ok read up a little on the paypal site and apparently, there's something called 'chargeback' which protects the interest of the buyer. Even though the $$ has been moved to the seller's account, the buyer can claim a 'chargeback' if his goods don't arrive or the goods that arrive are significantly different from what he ordered.

I'm guessing the guy who got his credit card stolen asked his bank to claim back the funds and the seller had to return the $$. (although I still don't see why the seller has to, because he has fulfilled his end of the bargain)

It's great for buyers, but sucks big time for sellers. The seller has also done his part by shipping the products out, I don't see why in the end he has to suffer from this.

The CC should absorb this loss and launch an investigation together with the police to trace the thief. (for example thru the location where the item was shipped). Unfortunately, it's hard to do this 'internationally', even though a lot of police depts in the world are supposed to be working together and the banks themselves have branches in so many countries.

I think it's just not worth their time to recover a couple of hundred or thousand bucks.

P/S Apparently even for non CC-paypal accounts, a 'claim' can still be filed against the seller.

LEDcandle: When the card is found to be stolen, the CC company takes back from the seller the money they sent to the seller on behalf of the buyer. It's called a chargeback. If you pay for something on ebay with a credit card based account and the seller never ships the item then the CC company will do a chargeback from the seller and return your money to you. Chargebacks can work both ways. Buyers like to use CC because it gives them extra protection against fraudulent sellers. Visa and Amex take CC fraud on ebay very, very, seriously.

Ah, you beat me to it.

haha... thanks for the effort though!!!

I still think the seller has done no wrong...
there's recourse for the buyer... but how about the poor seller who sent out his item? There should be more protection for sellers.

While I use paypal to pay for and accept payment for some things, one should be very careful with it and not depend on it for larger transactions.

The site www.paypalsucks.com will open your eyes.

I have 2 paypal accounts, one US based and one Argentina based, both are verified.

The scams you can encounter are many:

- the obvious stolen CC
- the chargeback
- the non received item complaint.

The last 2 are the most dangerous:

chargeback: the user has up to 3 months to file it
non-rec: unless you ship registered, EMS or Courier you dont have the means to check if the items were received

Paypal tells you the profile of the purchaser, so if the account is new or is unverified, be cautious. This doent mean that all new or unverified are crooks, but they just need more safety measures

As for paypalsucks, yes it sucks sometimes (I know I suffered) but is the necesary evil and wildly popular, you can't do sales on the amateur level without it.



My two cents of peso


Pablo

recently Paypal has been activated for my country. so finally i can take part in so much stuff that is going on here and on ebay, etc.. ( resulting in much of my money being spent )

Anyway i had to veryify my account by inputting a number only visable on my cc statement so i had to wait until i recieved it. when i was not verified i could only spend about 50$ or so. when i got verified i could spend more, but when i had to make a large payment they instantly locked my account and requested more documentation to verify my address etc.. they directed me to an online form which i had to fill in and print and fax together with copies of my cc statement and another bill containing my details.
the next day my account was open again and i transferred the large amount with no problems.
I was very satisfied with the speed with which they handled this, and it goes to show that paypal are taking a lot of precautions to eliminate cc fraud.

amonra, do share with us approx how much was this 'large amount'

The thing is paypal won't intervene for 'small' amounts (maybe $200-300?), but for a seller (esp. an individual) to get cheated of this amount 1, or even 2 times, is really painful and could mean a lot to some.

But overall, my experience with them has been good so far both paying and receiving payment.

Credit card and PayPal merchants have responsibilities to avoid making sales with stolen credit cards. Primarily, a seller can ship only to an address on file with the credit card company or a PayPal confirmed address.

I currently have an item on Ebay, how do you know what address is on file with the CC company? Does it appear on the "Send item to" field?

AlexGT

If the buyer pays with PayPal, he should submit a confirmed shipping address with his payment. The payment notice from PayPal will show that.

It would be a good idea to amend your eBay listing to say that you will only ship to a PayPal confirmed address.

Which means no international customers because paypal only confirms US addresses.

the payment was in the order of a few thousands.
I guess paypal confirms my address now.