posted on June 25, 2001 03:45:53 PM new
As a former bank examiner for the Department of the Tresury and the Federal Reserve, I beleive that there are issues here. I would be very interested in knowing why PayPal believes that these disclosure are not illegal. I do not believe PayPal has any legal basis to disclose how many financial transactions a user has completed. Citibank certainly could not tell a merchant how many credit card transactions I have completed or how many checks I have written.
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Individuals paying with credit cards are more than adequately protected from fraudulent transactions with most banks holding customers liable for nothing in a fraudulent transaction. If you have ever read the Confidential Visa and Mastercard manuals, you would see how pro-consumer that they are.
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I do agree with a prior comment that PayPal may be attempting to get more users to verify their accounts through these disclosures. In my opinion, PayPal is the merchant processing bank and it is PayPal's job to assess the risk of fraudulent transactions. PayPal's problem is many transactions are completed with interfund transfers which makes PayPal the responsible party rather than your credit card bank. Also, if there is too much fraud in its credit card transactions, Visa and Mastercard could take action against PayPal.
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In my opinion, these account disclosures are being done for the benefit of PayPal not the users as it is being sold to the "community". I do not beleive that these disclosures will have a significant imapct on how people transact business. What it may do is what PayPal wants, more users to verify their accounts to lessen its risk and keep it out of trouble with Visa and Mastercard.
posted on June 25, 2001 04:01:14 PM new
Hi topprospects,
" I do not believe PayPal has any legal basis to disclose how many financial transactions a user has completed. "
We are not disclosing the total number of transactions, much less a dollar amount, to the user.
All that is being disclosed is how many Verified members of the PayPal community the individual has conucted business with. No financial information is revealed to any user.
"I do agree with a prior comment that PayPal may be attempting to get more users to verify their accounts through these disclosures."
Yes, Verified users have supported their identity in the network, which reduces the fraud concern(s) to the user and the company.
This is simply a guide to help users when making a discretionary purchase.
posted on June 25, 2001 04:02:14 PM new"Dump 'em!!! I did and it hasn't hurt my business one little bit!"
No, that's what they want you to do. If my local branch bank started to give out this unauthorized information, I simply wouldn't go switch to a different bank. That's because I have my business's finances tangled up in so many ways, not just a depositor's account. Instead, I would concult with my lawyer on the phone (as I have with this PayPal incident) and discuss starting a lawsuit for damages. I have yet to hear back from my lawyer as he is checking the federal courts on this at the moment.
posted on June 25, 2001 04:14:08 PM new
I appreciate the points that Borillar has raised and I look forward to further updates. I do not have easy access to the same resources as Borillar, and I am grateful that this information is being provided to those of us on AW who are interested in learning more about this situation.
posted on June 25, 2001 04:16:12 PM new"This is simply a guide to help users when making a discretionary purchase."
I deny that. That is what the PayPal Verification Program is for. That is why I went through the hoops to get Verified TWICE: once when I set up Direct Deposit and then again when the Verification Program became available.
I submit, as I will in court if need be, that PayPal's Verification Program is either adequate to the task intended, or it is a failure and the Verification program needs to be withdrawn.
PayPal has NOT provided sufficient proof(s) to me that any current or potential customer of mine is balking at using PayPal because the PayPal User Verifivation Program is inadequate. I have never received any requests for alternate means of credit card payments from current or potential customers due to questions from my having a Verified account at PayPal. Therefore, I deny that this problem exists for me and PayPal may very well be required to satify a judge in a future court of law that there is any problem at all if they do not rethink think plan of theirs.
PayPal is opening up a whole can of worms that it ought to be wiser about. Revealing my business's account information, even this minor amount, in invasive and UNNECESSARY.
If, as some may feel that this is a blatant attempt to push non-Vierfied users into the Verified domain, then they are treading in a legal minefield. And I would expect PayPal's representative, aka PayPalDamon to deny that this is the reason for legal purposes.
posted on June 25, 2001 04:30:01 PM new
Seems relatively innocuous to me. Not quite as bad as giving your bank name and checking account number to a total stranger but I do that almost daily. But then, again, I liked playing with jarts so what do I know.
posted on June 25, 2001 04:39:46 PM new
> So I guess you ask all your buyers to NOT
> leave you feedback on ebay, so your
> competitors wont be able to count up the
> number of buyers you had.
eBay feedback up to now is optional. This Paypal Community Participation appears to suggest that it will be globally applied.
If by default, you are opted out and could join by activating the feature, I bet most sellers here would not complain.
posted on June 25, 2001 04:49:25 PM new"So I guess you ask all your buyers to NOT leave you feedback on ebay, so your competitors wont be able to count up the number of buyers you had."
capotasto, there is a very real difference here between "feedback" from previous customers and having PayPal come out and release private account information to the public. Getting opinions from customers I've had is a very vague way to analyze my business. I seriously thought about telling my customers not to give feedback as I thought that it was a stupid system to begin with.
There's also a large difference between the opinions of customers and proprietary account information disseminated by PayPal. While I can not envision all of the ways that this information could be used to the detriment of my business, it is clear that it is unnecessary to have this information given out. Therefore, any harm that does come to my business that can be linked in any way to this breach of confidentiality on PayPal's part may cost them dearly in court.
posted on June 25, 2001 05:09:38 PM new
Borillar, I understand and even agree with what you are saying, but what I don't understand is why you bother to put up with PrayPal at all.
It's not like they are the only fish in the financial sea and if you don't like their policy-of-the-week you are free to leave and take your info with you.
posted on June 25, 2001 05:11:16 PM new"If by default, you are opted out and could join by activating the feature, I bet most sellers here would not complain."
I'll bet you that if your bank was to disclose this proprietary information about your account on their public web site, you'd do more than just "complain" about it.
PROVE TO ME THAT THIS PROBLEM EXISTS!
It does not exist for me!
Does it for you?
Do any of your current or potential customers complain to you that they are scared off of using PayPal BECAUSE they can not see any of your account history?
How many simply do not trust PayPal because of PayPal? How many do not trust PayPal because they do not trust ANY Internet business? How many do not trust PayPal and other Internet Credit Card Businesses BECAUSE of their reputation for lack of privacy? Is PayPal shooting themselves in the foot?
THERE IS NO PROOF THAT RELEASING THIS PROPRIETARY INFORMATION WILL REASSURE POTENTIAL CUSTOMERS!
What independent studies have been done to suggest that releasing everyone's proprietary account information to potential buyers is going to reassure them? Where is that information?
If the problem really is that PayPal wants to force unverified account holders to become, then DO IT and get it over with! Take the SLAM on the portfolio and then get on with business. Don't go this roundabout way of doing it.
posted on June 25, 2001 05:12:30 PM new"Borillar, I understand and even agree with what you are saying, but what I don't understand is why you bother to put up with PrayPal at all."
posted on June 25, 2001 05:24:01 PM new
I am a Power Seller and as as soon as I saw this last week I took their logo off of my auctions and am closing my account with them. How may PayPal transcations I have had and how long I have been with them is no one's business. To add insult to injury they are raising their rates for the second time - and in financially poor times for the country.
posted on June 25, 2001 06:14:15 PM new
Hi greetingsfromuk,
Verification is just around the corner for many international users. Verified international users will be able to participate (I don't have a specific date, or solid details, that I can provide you with).
[ edited by paypaldamon on Jun 25, 2001 06:36 PM ]
posted on June 25, 2001 06:37:18 PM new
I took the PayPal option out of my auctions last week, and was giving them the option in my EOA, but I'm removing that as well.
Besides, Billpoint has moved out ahead of PayPal. I have more buyers using Billpoint then PayPal. So to be honest about this I don't think PayPal will be missed.
I might add They brought it all on themselves. With the lies and constant fee hikes...they can keep it.
posted on June 25, 2001 07:08:24 PM new
It seems like many people here think that their account information is jealously guarded by their bank. Are we really sure that's the case?
Maybe you can't call up the bank and find out what your ex-wife's bank balance is, but I think banks routinely disseminate this type of info to other institutions, or to anybody with enough bucks to pay them for it.
My memory on this is sketchy -- in fact, so sketchy that I maybe should leave it somebody who's more knowledgeable than me -- but it seems like there was recently some legislation (Federal, or maybe only in my state?) that prompted financial institutions to send out information to all their customers regarding their privacy policies.
The one I got from my bank said that, unless I instructed them otherwise, they pretty much give out my info (including, I'm assuming, my bank balance) to anyone they feel like it. Presumably making money by selling it to direct marketers, among other things. They provided me with a form that I could send in that restricted the sharing of this info to a degree, but it still allowed them, at the very least, to share info with companies they're "associated with" for the purpose of selling me the products of these "associated companies."
People who are concerned with privacy (like me) might want to double-check with your bank on this.
posted on June 25, 2001 07:57:22 PM new
I'm not sure how it fits in with privacy (eBay's checking-account info requirement from new sellers is a much more egregious case there), but I do agree with those who say it's overkill and not really PayPal's role.
Part of the problem is that PayPal keeps trying to move people off credit cards, even though credit cards are the only vehicle with good STATUTORY protections for consumers. I'd much rather have a consumer protection written into law than a "protection policy" that could be voided if you didn't do everything just so, and has no force of law behind it.
I have no particular ax to grind against PayPal and think they're far superior to Billpoint, for one. But they do have credibility problems in that they've had to do flip-flops on past statements after changing their business model.
Biz-school textbooks in 10 years will probably recount PayPal as a classic case of baiting and taking losses to build market share and then switching in key areas to wring more money from customers and make the model profitable. The bet is they can hold the market share even as the deal for customers gets progressively eroded.
posted on June 25, 2001 08:14:21 PM new"They are displaying the number of unique verified customers you deal with, not the number of transactions, nor the amounts"
Would you find that information reassuring if you were a doubtful credit card payer??
posted on June 25, 2001 08:56:09 PM new
Boy, I started out disagreeing with Borillar and now find myself on his side of this argument.
In spite of the fact I will probably look pretty good on PayPal's crib sheet come June 30 I, too, find the system completely flawed and unnecessary. (As an aside, I have not received a Paypal referral $5 for over four months, meaning very few people are bothering to get verified).
If this is truly a new way for PayPal to get members verified, using me and my business and my history as some sort of a fulcrum, then this is truly no good.
(and, personal to PayPal Damon: I spoke to 'Jeff' in your big-users support group on Friday and requested a call-back from PayPal headquarters regarding your new fee schedule. I have not received that call-back yet.)
posted on June 25, 2001 09:03:00 PM newAs an aside, I have not received a Paypal referral $5 for over four months, meaning very few people are bothering to get verified
That is because PayPal now requires you to confirm your email address, confirm your checking account, add $250 by electronic funds transfer, and sign up for our Money Market Reserve Fund to get the whopping 5 bucks.
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posted on June 25, 2001 09:22:59 PM new
Hi vargas,
"By PayPalDamon's own admission in another thread, some 70% of PayPal users remain unverified"
I believe I stated that I don't have current numbers, but that the number is over 30%.
hi revvassago,
"But earlier in this thread, paypaldamon wrote:
The information supplied does not reveal the number of transactions
Isn't this a contradiction?"
No. "Unique" means that you have conducted one transaction with another verified member. Any additional transactions with the sender would not impact the community number in an upward manner (In other words, only one payment per one person will move the Community Number up. Additional payments,made by the same party, will not be reflected in the calculation).
posted on June 25, 2001 09:26:35 PM new
We were one of the first Red Carpet members at PayPal, when they added fees I stopped taking PayPal for about 5 months. then I added PayPal as a payment option in my follow up emails when people didn't pay, kind of a last ditched effort to save from filing on the deadbeats.
this month I added the PayPal logo back into my listings, do you think PayPal could send me a email letting me know that they had increased their rates? NO I had to find out about the fee increase through the AW boards.
one question you have to ask is will something like this backfire like the powerseller logo on ebay has. lots of people see the logo and run. others who do use it always seem to be selling items that boarder on legal, are stretching the rules, or are selling junk you just don't need or want, they also seem to rack up more neg. than the rest of the users. So if someone sees that the seller has done xxxxx payments is this going to send up red flags? will buyers feel that they will be left standing in a crowd and be provided with less than adequate service?
I for one will be removing the links again due to the fees and I really don't care to have anyone knowing anything about my business so this might be the last straw for me. I've pressed the cancel account button more than once but have backed out before it was final.
PayDirect works just as good and if C2it can ever verify my social I'll give them a try too. Funny I've bought houses, cars, had loans everything you can imagine, even have a citi-bank card and they can't verify my social...........
