Going, going, stung [PayPal/eBay collection fraud]

[Jay_S]

Dear All,

 

I became the victim of a fast-growing fraud last weekend, a con which I believe needs highlighting to the wider public, and in big style too.

 

I was forced to sell my main computer, an iMac originally bought new 4 years ago. For ease of use (and because of the good experiences I'd made with them until now) I chose to put the computer up for sale on eBay, both as an auction and a 'Buy It Now' option. As you know all Apple products generally have a high resale value; I was hoping to get at least £400-500 for it, so I set the Buy It Now price at £525. Less than 2 days into the auction, the item was snapped up by a buyer with an (admittedly) very low number of transactions, but 100% positive feedback -- still the only thing to go by when checking for a buyer's/seller's integrity on eBay.

 

After his initial contact asking for my phone number, I received a call on Friday night as to whether I would agree to the Mac being collected. I was okay with this, however, telling him in which case only cash would be acceptable -- for two reasons: 1) PayPal transactions can be reversed, a procedure they call 'Chargeback'; and 2) PayPal only provides for seller protection if items are shipped by tracked courier. The next morning, and contrary to our agreement, I received a payment for the full amount via PayPal. Less than five minutes later, a lackey (presumably the buyer's mate) rings the doorbell and asks if the Mac is ready for collection.

 

In my naivety (and in the spur of the moment) I agreed to the hand-over of goods, in good faith that this was a bona-fide transaction. What else is one to do within 5 minutes? The lackey makes off with my Mac -- no receipt, no signature, no CCTV, no witnesses, and I could still kick myself for not following him to his car to take the registration -- and less than 12 hours later I received an email by PayPal informing me that the transaction had been reversed due to 'unauthorised use' of the buyer's PayPal account (which, incidentally, was not in the name of the buyer, as I found out later through checking electoral roll records).

 

As one can imagine, the buyer now does not respond to any of my messages (the phone number used is disconnected; presumably a pay-as-you-go SIM card bought solely for this purpose). Needless to say, I feel absolutely shattered and like a complete idiot. On following this up with the fraud department at PayPal, I was told in no uncertain terms that I can kiss my iMac bye-bye and that "this wouldn't have happened if I had abided by their safety protection" (i.e. shipped the computer).

 

I have now reported this crime (as I believe this is exactly what it is) to the police, although they will in all probability not follow this up since it is a civil law matter, and the chances of a successful prosecution of the fraudster are pretty slim. What's more, the name and address of the PayPal account the buyer used (or abused) do not match with electoral roll records, which makes me believe that the whole 'unauthorised use' claim is poppycock anyway. Quite apart from that: I may be old-fashioned, but it is the PayPal account holder's responsibility to prevent unauthorised access to their account: their email address is analogous to a credit card; their login password to a PIN.

 

Now, my main gripe -- and the real issue here -- is not so much with the conman (nor his lackey, who may be completely oblivious to the fraud, nor the allegedly-'hacked-into' PayPal account holder), but with eBay themselves, who insist that PayPal be offered as a payment method even for collection items, at the same time PayPal flatly denying all responsibility to the seller (i.e. me) in case there is a dispute, and only siding with the buyer, fraudulent or not. This is in addition to the fact that they are one-and-the-same company. In other words I, as a seller, am not allowed to state 'cash only' on collection (I will get penalised for this), but am not protected by PayPal (which is being touted as a 'safe' payment method in the same breath). I don't believe that PayPal should be allowed to weasel out of their responsibility, because with their opaque terms, conditions and requirements they are effectively facilitating criminal actions such as this.

 

The issue was already highlighted by the Guardian consumer protection section (guardian.co.uk/money/2012/jan/27/is-paypal-safe-protection) a couple of months ago, but I feel it needs to be brought out again so that eBay/PayPal will be pressured into a change of their T's&C's, and into acknowledging at least partial responsibility. I believe there have been a great deal of people recently who were stung really badly in the same manner, and a great many call-to-action groups sprouting against PayPal's more questionable techniques online.

 

Lastly, ever since PayPal has located their headquarters away from the UK (they are now based in Luxembourg) I wonder whether they are still bound by FSA rules (they used to be); if not, their status of a de-facto 'bank' should be brought into question, and maybe relegated to a simple money-wiring network, in which case they are no more secure than Western Union, Moneygram et. al., the very companies that they accuse of being 'dangerous'.

 

Has anyone been in a similar situation? Is it worth pursuing the matter through the courts?

 

Any advice would be greatly appreciated, and please forward to as many people as you know, because this type of fraud needs to be stopped.

 

Thanks,

 

Jay

[rebel11]

Hi jay

 

Welcome to CAG

 

The guys will be happy to advise as soon as they are available.

 

Please let us know how your problem has been resolved, it could help fellow Caggers.

[andydd]

As you mentioned this is a very common fraud on ebay, especially for desirable items such as macs, ipads, etc.

 

I myself fell victim to it some years back (an old windows tablet PC), luckily the money had already been transfered and I was left with Paypal pursuing me for the money, which they gave up !, so I wasnt left out of pocket.

 

I too foolishly accepted money via paypal (a hacked account like maybe yours involved), and a collection in person, yes you too were rather foolish but letting the item go, especially without even so much as a signature.

 

Whilst claims from Paypal demanding for money are easily seen off (in fact it is well known they rarely pursue legal action), I wouldnt hold much hope of you being abke to recover your money. Their T&C's whilst dubious in some respects would appear to give them the upper hand in this.

 

Andy

[Jay_S]

Hi Andy,

 

Thanks for your quick response. The funds have now cleared on my current account, but I'm unsure what to do. I have never been in such a situation and don't like the idea of being threatened by bailiffs for a fraud of which I am the victim, not the perpetrator.

 

I acknowledge my foolhardiness in not asking for any proof of ID or signature at point of collection, but even if I had, PayPal would not accept them as valid evidence.

 

As it stands I really need the money for some urgent home repairs so I'll wait it out. I have a crime reference number and proof that the iMac was mine. But if PayPal come back at me with threats I don't think I'll have the stamina to go through with the ordeal. I will try and find the money to clear the negative PP balance, send them a strong letter outlining my disgust with their handling the matter, close both PP and eBay accounts and report this to Watchdog and consumer protection sections of major newspapers.

 

If only some of the action groups out there would combine forces, I would be very happy to take part in a class action against PayPal/eBay.

 

Thank you

 

Jay

[andydd]

So you now have the money in your bank account ?. And I assume that your PP account is -£525 ?

[Jay_S]

Yes, exactly. My choice is now to clear my PP balance, or to hold on to it until they start applying the thumbscrews. I don't think they will budge out of goodwill, not from what the PP rep told me on the phone.

 

Jay

[freakyleaky]

Paypal usually give up and very rarely pursue legal action.

[andydd]

Well problem solved, paypal will huff n puff n youll get letters from Debt Collectors but they are not known to pursue legal action in cases like this, maybe because its unclear whether their T&C's would stand up in court.

 

You wont be able to remove your bank/card details from PP but you may wish to make sure there isnt £500 lying in your account and cancel your card ?

 

Andy

[ajd01]

Similar thing happened to me.sold an item on ebay,£280 and it shipped to somewhere like Poland.buyer claimed not to have received the item and PayPal refunded even though I provided tracking.claimed because if the.country it went to I had no seller protection,yet the buyer us protected.luckily for me I.had withdrawn the funds so it set a negative balance...they sent me numerous letters and I told them to whistle for it.

This was about 2 year back,they don't bother me now,although I still have the shipping receipt in case.

Gutted to hear what happened to ya..ebay/PayPal are a joke for.protecting sellers.I will never sell on there again.

[andydd]

Well..despite Paypal trying to persuede people to send abroad, that is why many dont, its not worth the risk.

 

Andy

[freakyleaky]

I try and stick to collection only items and stipulate cash on collection.

I have had a few pay via paypal before collecting but have simply returned the payment and reiterated cash on collection.

[citizenB]

pvd999 has their own thread now..

 

HERE