Users of PayPal as a payment system beware. The system is flawed and open to fraud.
Whilst being hailed as a great alternative payment system for internet transactions, PayPal also suffer greatly from fraudulent activities perpetrated by individuals who know how to work the system.
The simplest one of these is Credit Card Chargebacks.
In this easy scam, a scammer buys an item using his credit card to pay via PayPal.
Several months later, he initiates a chargeback on his Credit Card company, meaning he asks the Credit Card company to refund his money because of one of three reasons provided by PayPal.
Either -
The Goods were not as described,
The Goods were defective or damaged
The Services were not rendered.
In the case of the last, if the seller has no proof of delivery, then the chargeback is approved, in the case of the other two, all the buyer has to do is give a Postal Tracking Number to the Credit Card company showing an item being returned to the senders country of origin and the chargeback is approved.
He does this by sending back an empty box – thereby getting a tracking number and to further complicate the system to avoid detection, he addresses the box incorrectly so it never actually arrives at it’s destination, it just gets lost in the system.
In all three cases, PayPal simply debits your account for the amount of the chargeback plus fees.
In the end the buyer has his goods and you have no money.
It is almost impossible to fight this fraud, and PayPal was their hands of the whole matter, claiming you as the seller agreed to the terms and conditions of credit card purchases when you sign with PayPal.
There are many more PayPal horror stories, judge for yourself what action you should take before deciding to use this payment system…
www.paypalsucks.com