PayPal - Friend or foe?

[Shorts]

Ray, sorry about the troubles with that guy. A frozen account is my largest concern using Paypal. Actually I have several issues with Paypal but I'm not quite sure what to use instead in order to maintain immediate online/electronic payment methods. I suppose investigation is in order to determine costs for alternate methods.

I hope this all goes away soon and you can get back to leather.

[UKRay]

Ray, sorry about the troubles with that guy. A frozen account is my largest concern using Paypal. Actually I have several issues with Paypal but I'm not quite sure what to use instead in order to maintain immediate online/electronic payment methods. I suppose investigation is in order to determine costs for alternate methods.

I hope this all goes away soon and you can get back to leather.

Monica, to be honest, now the dust has settled on another day, I'm not too worried about PayPal as although they adopt a severe attitude to complaints, this is the first problem/complaint I've ever had in all the years I have been dealing with them. I'm not expecting another anytime soon so it is probably best to put this down to experience and try to make sure it doesn't happen again.

PayPal has just emailed again and said that if the guy doesn't prove to them he has returned my stuff by June 2 they will unfreeze my money and all will be as it was.

Karma will hopefully catch up with the and all will be well with the world; so I'm going to go and pound some more leather...

Ray

[MADMAX22]

In the US you can tie a checking account into your payPal account. If any money accumulates in my PayPal account, I "withdraw" it to my checking account. If I want to buy something with PayPal and the money isn't there, they debit that same checking account. Was he able to freeze the whole account because that was the total of the original transaction? If he was only disputing $25 then only that much of the account should have been on hold, not the whole balance.

Johanna

From what I understand that is allmost worse, if you have a bank account tied to your paypal account then they can freeze all money's tied to that paypal account which includes your bank account. I have read countless tales of poeple who had there checking and savings frozen because of a paypal dispute and the bank couldnt do a thing about it since you basically signed a contract with paypal.

Thats the main reason that any bank account that I tie to paypal will be solely for that reason and no other. And I wont base a business or much else on it.

[JohnBarton]

From what I understand that is allmost worse, if you have a bank account tied to your paypal account then they can freeze all money's tied to that paypal account which includes your bank account. I have read countless tales of poeple who had there checking and savings frozen because of a paypal dispute and the bank couldnt do a thing about it since you basically signed a contract with paypal.

Thats the main reason that any bank account that I tie to paypal will be solely for that reason and no other. And I wont base a business or much else on it.

For those that don't know this is called an ACH or Automated Clearing House transaction. It is the way that "electronic checks" are done and businesses like PayPal and subscription houses started using ACH to do automatic deductions.

The largest danger here and it's a BIG BIG BIG one is that ACH requests can ONLY Be canceled from the merchant NOT by the account owner. So most banks will refer you back to the merchant when you dispute an automatic deduction.

I used to have a bunch of these out there when I thought it would make my life easier. But they don't and they can wreak havoc on your bank account if they deduct the wrong amount or you get to low in your account around the time a deduction comes along.

I used to have a seperate paypal account for accepting money that was not tied to any real world bank account. Then when I got money into it I would transfer that money to a second paypal account that was tied to an account. I NEVER left money in the first account and NEVER used it to buy anything. If it went belly up due to some transaction like what happened to Ray then I would have shut it down and opened another one. I ran a couple hundred Ebay auctions through that account.

I have to say again that I have haven't had any trouble with PayPal BUT it pays to be cautious especially in light of new policies on the part of Ebay and PayPal. I never do business these days on Ebay and I almost always get paid through PayPal by people that I deal with extensively on their order before they pay me. I do use the same account now to also pay for things and it's tied to my account so there is the danger that it could be screwed with by PayPal but I have my fingers crossed.

Twice in the past month PayPal has held up a transaction. Once it was on a payment I made, and PayPal actually called me to verify that I had made the transaction and it was legit. The other time was a few days ago when I received a deposit on a case. They put a reveiw hold on it and it was cleared the next day.

On that one I was a little pissed off that they have taken an extra $9 without any indication as to why? I assume it was something to do with the exchange rate from my buyer's currency into USD but it would be nice of them to indicate that somehow.

While we are on the subject of PayPal let me share this scam with you so that none of you fall into this trap.

Beware of people who offer to pay you in two installments. The scam goes like this, they offer to pay you in two installments from different accounts. The first payment is a small amount and it list the item you are selling. The second payment is for the balance.

As soon as you ship the item the scammer will dispute the second charge claiming that they didn't have anything to do with the purchase. PayPal will freeze the money and then eventually return it to the second account's balance UNLESS you jump through hoops proving how it all went down - and even then they may rule that it's not the "account holder's" fault and not give you the money.

So if anyone offers this then decline because it's probably 99.99% a scam.

It happend to several folks on the billiard forum who were cheated out of their cues. Most were able to get their cues back but not without a lot of help from the forum members acting locally where the scammer lives.

[UKRay]

That sounds like very good advice, John.

I'm going that route first thing on Monday morning! A brand new bank account with no money in it that is just used as a clearing account would work for me. I'm also going to open another PayPal account to make sure I can keep trading even when they are playing silly beggers. Thanks my friend.

Ray