jimmymunce
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posted on October 10, 2002 05:40:03 PM new
I have read the postings regarding PayPal and the problems many are having in regards to the security of your money. I recently was the unfortunate victim of such a problem. For those who use PayPal, please be aware that at any given moment and for any reason, a seller who has sent you money for an item can at anytime, place those funds on hold for a minimum of 35 days! Regardless of whether you can prove that your item was sent and delivered, they can simply log onto PayPal, fill out a form and place every penny they sent on immediate hold. Now I understand how this is a security measure to help avoid fraudulent transactions but as a buyer, this is a huge loophole that can lead to financial disaster. Should you depend on those funds for stocking your future sales, a single angry buyer can devastate your earnings for a minimum of over 1 month. THE BUYER HAS NO CHOICE BUT TO WAIT FOR THE MONEY TO BE RETURNED and this is entirely up to the person who initiated the hold to begin with! PayPal will make NO EFFORT in returning these funds to you for 35 days should the buyer decide not to contact PayPal and request it! I have proven delivery, I have spoken with several PayPal personal and to quote them “they cannot and will not assist in anyway for a minimum of 35 days! It is entirely in the hands of the person that initiated the hold”. Most people are good and I highly doubt someone would decide to do this to me because of blackmail, simply to be mischievous or purely out of anger but it angers me that should a person so decide; they have the ability to cause any PayPal seller an enormous amount of trouble. The trouble stems from a single first time buyer whose decided that the delivery time of 10 days was not an acceptable time frame to receive their item. Though the item was shipped and I can prove it and have both to PayPal and the buyer, my account is now in the red for nearly $200. They will not contact PayPal to return my money and PayPal will not contact them on my behalf nor will the buyer return my emails. Had I pulled my money out of my account before this had occurred and kept a zero balance, I would simply have a negative $200 balance; there is no security in keeping a zero balance in regards to this loophole.
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Coonr
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posted on October 10, 2002 05:46:18 PM new
Someone is giving you false infromation. While an investigation may take some time, the delays your discussing are indeed rare.
I have had one buyer complaint, I sent the required info, and the hold was released in less than 48 hours.
If the hold is that critical to you, you should seriously reconsider and form of credit card or electronic payment, as it is probably to risky for you.
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jimmymunce
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posted on October 10, 2002 05:56:09 PM new
Your hold was released within 48 hours simply because the buyer agreed to it. If that buyer had refused to initiate the release of your money for any reason or simply ignored you, PayPal would have held it for a minimum of 35 days. The possibility and the reality of this happening is what concerns me. I was very clear with PayPal about this problem and was on the phone for over 45 minutes on each call trying to clarify this. I made very certain what I was hearing was correct. Please read the PayPal fine print.
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rarriffle
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posted on October 10, 2002 06:12:25 PM new
did you mail the item to a paypal confirmed address and to the person who was registered at paypal? if so, then after sending proof of delivery they will release the funds.
if, however, you shipped to an unconfirmed address, well you were warned
they released my funds within and hour or two of my sending the required information.
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ahc3
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posted on October 10, 2002 06:15:26 PM new
I would be more afraid at the thought that $200 would wipe me out!
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jimmymunce
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posted on October 10, 2002 06:36:30 PM new
The item was indeed sent and delivered to a PayPal confirmed address and the buyer was indeed registered with PayPal. I do not and will not accept payment nor will I ship to an unregistered person or unconfirmed address. This, according to PayPal has no significance in regards to the return of funds. I wish it did and I have spent far too much of my time trying to find exactly what will return my funds but according to PayPal, nothing less then the buyer requesting the return of funds will result in the funds being credited back to my account. Should you know something I do not, please point in the right direction, I would greatly appreciate it.
In regards to $200 wiping one out, the amount is not the issue; the fact that money can be withheld from ones account for the above mentioned reasons should concern anyone using PayPal.
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ahc3
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posted on October 10, 2002 06:44:28 PM new
I once had a $2000 transaction that was held up and temporarily reversed on my merchant account. Paypal is not any different than a traditional merchant account in that respect. If you are a buyer and suspect fraud, you will appreciate these safeguards. Is there room for abuse? Yes. Is there anything you can do about it? Not really, except just make sure you are not on the edge where someone placing a hold for one reason or the other on the funds won't affect your business. If it does, you don't have things very well planned out.
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Coonr
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posted on October 10, 2002 06:49:38 PM new
Your hold was released within 48 hours simply because the buyer agreed to it.
WRONG! The information was verified, that I had complied with the terms of the SPP and my problem was over. PayPal release the hold. Nothing else the buyer could say or do.
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jimmymunce
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posted on October 10, 2002 07:06:21 PM new
So what information am I missing here?
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capotasto
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posted on October 10, 2002 07:37:55 PM new
You have not mentioned whether you used online trackable delivery.
If you did, no problem.
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jimmymunce
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posted on October 10, 2002 07:41:04 PM new
UPS Ground which includes online tracking. Have supplied tracking number to PayPal and they in turn have supplied it to buyer as has my auction service. Still, regardless of how I try PayPal states 35 days.
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Coonr
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posted on October 10, 2002 08:00:13 PM new
Who, what or where is telling your 35 days?
That is not reality.
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Libra63
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posted on October 10, 2002 08:34:58 PM new
He states that the buyer was dissatisfied with the 10 delay in receiving package. How fast did the buyer pay you? If the buyer paid you immediately by PayPal then that package should have been mailed immediately and with UPS ground should have reached him in less than a week. Do you mention in your auctions about delivery date? When I buy something and I pay by PayPal I expect my package to mailed out within the limits set by the buyer and not wait for a week. I know that some people live far away from a post office and in their auction they mention that they only mail 1 day aweek. I will accept that if the auction states that. Did they restrict all of your PayPal account or just the part of this buyer? We are aware of PayPal and what they do. Follow their rules and you will be okay. The only thing we can't control is a fraudulent credit card.
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jimmymunce
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posted on October 10, 2002 08:57:44 PM new
I clearly state in my auctions that items will be shipped within 48-72 hours after I receive payment though I usually ship the following day. Items sent within the USA by UPS Ground may take as long as 6 business days not including weekends or holidays. Should an auction end on Thursday and payment is received Friday afternoon, that item cannot be shipped until the following Monday as UPS pickup is early morning. Unfortunately UPS has at time taken longer to deliver then this allotted time frame. The buyer received the item on the 10th day though a complaint was filed only 3 days into an estimated 10 day delivery window. Buyer filed complaint and PayPal put funds on hold AFTER item had been shipped and the tracking information clearly provides that information. FYI-Though I would NEVER withhold a package for say 3 weeks before delivery, eBay states an acceptable time frame for delivery of 30 days. PayPal is now owned by eBay which further confuses the issue.
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jimmymunce
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posted on October 10, 2002 09:09:34 PM new
PayPal deducted and is holding the amount the buyer paid for the item. I keep a limited amount of money in my PayPal account as PayPal is not a bank and the funds are not FDIC insured. I had $100 in the account and now show a negative balance. I have auctions closing tonight and can only assume that several will decide to pay by PayPal. Since I do not have a balance I cannot withdraw or transfer any amount, I will have to wait until the balance shows a positive balance to tell if it is completely on hold though I doubt this is the case. According to PayPal, this restriction is not due to an error on my part, simply a complaint and request from the buyer. My concern is that this can be done simply because the buyer requests it. I can prove delivery and PayPal has this information in the form of a UPS tracking number supplied days ago.
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fluffythewondercat
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posted on October 10, 2002 09:30:10 PM new
jimmymunce: I assume you will write your winners and about-to-be winners to beseech them NOT to make PayPal payments to you. I would keep the email simple but stress that if payment is made via PayPal, there will be a delay and quite possibly a very long one before their package can be shipped.
As far as "Follow their rules and you'll be okay," that's the statement of a small-time seller who doesn't do enough volume to have had a PayPal problem. In other words, it doesn't mean much.
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jimmymunce
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posted on October 10, 2002 09:52:55 PM new
Fluffy:I agree. Following the rules is certainly advice to be heeded but unfortunately, PayPal leaves too many open holes for anyone to fall into regardless of well meaning. Charge backs, complaints, restrictions and the like can all be made regardless of how well the seller follows the rules. Right or wrong, the rules simply leave too many possibilities for these kinds of things to occur. As for emailing my buyers; the auctions have been listed for some time and I know some people would not have selected to bid on them if PayPal were not an option. I will personally guarantee their payments and honor their decision to pay by whatever means I listed on the auction details. Hopefully PayPal will realize that this kind of instability with their customer’s money will only lead to deflated balances among their customer’s accounts as they pull their money into more stable institutions.
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Libra63
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posted on October 10, 2002 11:13:35 PM new
I guess I am a little to strong in my wording about following rules. I am sorry about that and I didn't realize that the buyer started the procedure 3 days after the auction. Since PayPal has no other way in retreving funds this is their way to protect themselves. Regular credit card companies don't do this, I don't think, Now I am not telling you how to run your business, and oh by the way I am a little bigger than a small time seller, but what I do is leave my money in PayPal until I receive the email that my buyer has received the package and is satisfied with the product. I know that ties up your funds but it is a little safer. We are caught between a rock and a hard place with PayPal as they aren't a credit card company but I guess we have to do what we have to do to keep our customers happy. I truly am sorry that this is happening and it's because the new eBay buyers are a little leary with us sellers. Good Luck
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jrome
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posted on October 11, 2002 09:32:34 AM new
Well, I think you've WAY overstated your case. With a regular merchant account, you do not instantly receive payment, their usually is a hold period, I think of about a month. When Paypal accepts CC payments, they are not instantly paid. Besides, if a transaction is disputed, Paypal is on the hook.
In essence, Paypal releases the hole when they get the $$$. This may not be ideal, but it's the cost of doing business. The fact that most $$ is avaialable immediately is a nice bonus.
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paypaldamon
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posted on October 11, 2002 09:36:30 AM new
Hi jimmymunce,
Is this a chargeback? Or is it a Buyer Complaint?
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thchaser200
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posted on October 11, 2002 12:06:03 PM new
:
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kkaaz
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posted on October 11, 2002 06:56:30 PM new
[WRONG! The information was verified, that I had complied with the terms of the SPP and my problem was over. PayPal release the hold. Nothing else the buyer could say or do.]
Coonr, you are wrong. Had the buyer used a credit card, they could also attempt a chargeback thru the credit card company after filing a complaint thru Paypal.
They can first try a "reversal" and then try a "chargeback".
That could freeze the funds plus all the funds the seller has in the account.
and if the chargeback is a quility dispute, paypal would not offer protection.
And that is all assuming Paypal even replies to the e-mails sent by the seller as I know from personal experince they may not.
Sorry bud....
Even Damon asked if it was a "chargeback" so he can pass blame away from Paypal like he tried to do with me.
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kkaaz
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posted on October 11, 2002 07:02:27 PM new
jimmymunce
sorry to hear of your incident.
I hear what you are saying.
A buyer has 30 days to file a complaint even if not valid. Then the funds can be held untill Paypal feels the need to release them
If the seller can not contact paypal within the allowed time, the buyer wins by default.
Plus if they used a credit card, you have more concern.
IF the "reversal" fails, they still have a right to file a "chargeback" thru their credit card and then you may have to do this all again.
And if it's a quilty dispute, paypal does not offer protection from that type of "chargeback" even though on the website they claim they cover from "chagebacks"
Plus, paypal could freeze your own funds if they want. The terms of use allows this.
It's a shame the way paypal has become. I remember the good old days of paypal/xcom
[ edited by kkaaz on Oct 11, 2002 07:03 PM ]
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Coonr
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posted on October 11, 2002 08:19:38 PM new
That could freeze the funds plus all the funds the seller has in the account.
WRONG! That would only result in a hold on funds equal tothe amount of the transaction. You should review a more current copy of the terms of use if your going to offer advice. The limted reasons for an account being forze are clearly outlined and agreeded to.
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stonecold613
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posted on October 11, 2002 10:00:58 PM new
Did they hold all of your funds or only the amount of that particular transaction. If they froze your whole account, then they are in violation of a court order. Not too long ago there was a lawsuit in which they were ordered to unfreeze all accounts and to not lock any more. They are only allowed to lock the funds of a transaction, but you will still be able to access the rest of your funds.
That said, it is still a better policy to withdraw all funds on a weekly basis or once you get to a certain balance which ever comes first. Me personally, my limit is $200. So one week or $200 and I make a full withdrawal.
Also, even they don't want you to, open a second paypal account with another e-mail address as a back up. You can send that account to winners if there is a problem with your main account.
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grumpyebayer
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posted on October 11, 2002 10:10:45 PM new
With a regular merchant account, you do not instantly receive payment, their usually is a hold period, I think of about a month.
I have had various merchant accounts with different providers and the longest it ever took for funds to be deposited into my account was 3 business days. The average was 48 hours. Same with everyone else that I know who uses a merchant account.
Paypal probably gets their money within 48 hours like everyone else.
Where did you hear there is a hold period of a month?
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jimmymunce
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posted on October 11, 2002 10:14:32 PM new
They froze the amount of the buyers payment which left me a negative balance. I was actually never even notified of this. The only reason I became aware was the (-) in front of my balance.
I keep a $100 balance though when auctions end, it may jump to 10 times that before I can hit the ATM. Electronic debit takes almost a week and I cannot be without funds for that period of time. PayPal is not a bank and is not FDIC insured. Should something happen, the money is not secure.
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Coonr
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posted on October 12, 2002 06:42:36 AM new
PayPal is not a bank and is not FDIC insured. Should something happen, the money is not secure.
There are many, many financial institutions that are not banks and are not FDIC insured. The two most common are Investment Firms, which sell stocks bonds and have money market funds, and various Credit Unions.
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Coonr
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posted on October 12, 2002 06:46:47 AM new
I keep a $100 balance though when auctions end, it may jump to 10 times that before I can hit the ATM.
Jimmie, a little problem with the math here. How do you withdraw up to $900.00 ($100.00 Balance X 10 = $1000.00 - $100.00 = $900.00)from an ATM when the daily limit is $400.00 ?
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Libra63
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posted on October 12, 2002 08:51:11 AM new
PayPal is not a bank and is not FDIC insured. Should something happen, the money is not secure.
You are right about that UNTIL someone puts in a complaint or does a chargeback then your in trouble. These are the risks we took when we signed up with paypal. You have two choices 1. Stay with PayPal, or 2. unsign and start taking money orders again.
Either way is fine with me. I haven't been in that situation so I don't know how it feels and I hope I never am. I see PayPaldamon was in earlier and asked you a question did you write and respond to him?
I hope everthing works out for you....
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