posted on January 17, 2006 01:38:39 PM
Well now I have heard everything. I just finished talking to my sister-in-law who sells on ebay and buys on ebay also. It seems that Paypal as of yesterday changed FOR HER SECURITY a payment she made with a credit card to a seller to an echeck instead. The amount was for 4 thousand dollars a large purchase. Paypal took it upon themselves to change it to taking the funds out of their bank account.
Does anyone know if that is legal or even right of them to do?
Luckily they got an email? I think or they caught it yesterday and stopped payment at the bank due to not having those funds in the bank account associated with their Paypal account. They called Paypal and was told it was switched from Credit Card to an E check for their security ( My brother and sisiter-in-law security) yeah right! sounds like they were concerned if along came a CC charge back problem. Which would not have happened unless scammed by the seller.
This has turned into a night mare for them and now they don't want the item or any part of Paypal. It cost them $15.00 to stop payment on Paypal's high and mighty underhandedness plus not being able to complete the sell with these antics of Paypal. No time did Paypal tell them there is a limit on their CC spending which I am thinking it might be the case but Paypal didn't tell them this. And their CC is not limited! They have the Merchant account I think as they have a Paypal card to use and I don't think there is limits when you have that type account? Anyone have any ideas as to WHY Paypal takes it upon themselves to change the type payment they made?
OH for anyone's curiosity they pay their bills and are opening a business and this was for a machine for that business. They have purchased large ticket items in past 4 or 5 years no problems. So that should not have been an issue with Paypal.
Makes me want to watch out for sure but alas I don't purchase big ticket items or use my credit card for purchases anyway.
Would appreciate any thoughts from my fellow Vendio board users.
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Can't touch this! uh huh, uh huh.
[ edited by irked on Jan 17, 2006 01:45 PM ]
posted on January 17, 2006 02:36:59 PM
Makes no sense to me. PayPal would be liable for all charges associated with changing the transaction.
Sounds like an unauthorized bank withdrawal to me and as such would be subject to Federal Banking laws.
Could be that PP has hid new changes in their recent TOS change. I have not read them lately, but if it were me, I would go through the PP user agreement with a fine-tooth comb.
posted on January 17, 2006 05:10:23 PM
PayPal will do this from time to time for two reason I recall. To limit buyer's recourse in event of a problem, and to reduce PayPal's exposure to credit card reversals - both reduce PayPal's risks. I'm sure it's covered in PayPal short, easy to read TOS (probably on page 49 paragraph III subsection c. or thereabouts). Unfortunately since PayPal is an unregulated financial entity there is nothing you can do about it (unless you're located in the UK, EU or Australia where you're covered by Govt financial safeguards).
posted on January 17, 2006 05:49:09 PM
I'm sure if you dig deep enough into their TOS you will find a short sentence that allows them to do it. Otherwise, taking money out of someone's banking account without their express permission, or a court order is about the quickest way I can think of to wind up behind bars in California. All it would take is a few claims for embezzlement filed with FDIC against the banks involved to get enough pressure put on Paypal to abandon this sneaky practice and possibly move the state banking regulators to adopt Paypal as one of their flock.
If Murphy's law is correct, everything East of the San Andreas Fault will slide into the Atlantic
posted on January 17, 2006 05:54:47 PM
Thanks, I am thinking it has something to do with Paypal's protection not anyone else's. I am going to tell them to read the TOS and I will too. I read the whole thing about 9 months ago ( with no retention of its contents) but have not checked out the latest one. Made the mistake to print it once it ran I don't know how many pages that time and ran my printer dry. Learned not to walk away from my printer on things like that again, by the time I realized it was on page 40something? and tried to stop it the cartridge was almost belly up. LOL
Anyone know the location of such a rule in their toss let me know.
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Can't touch this! uh huh, uh huh.
posted on January 17, 2006 06:28:12 PM
My question is why use a paypal debit card to make this type of purchase? Debit cards are not credit cards, you don't have the same type of protection from them.
It's also a reason why I have my paypal account attached to a unique bank account, which I check daily and move money to my main checking account. There is never more than $5 in that bank account after I move the funds.
posted on January 17, 2006 07:11:36 PM
No they were using a regular credit card I was just saying they have to have at least a Merchant account with Paypal since they have the Paypal debit card. NOT that they used any Paypal card. I know if you have a regular account they do limit your spending somewhat. They have never been limited with using credit card or e check or instant payment. They have paid for items with all the options but Paypal took it upon themselves to change the CC pay to echeck and my sister-in-law knows what option they chose and entered credit card # at time of pay blablabla they are not newbie. Problem is not with the credit card it is good, problem is Paypal chose to change their pay option to other means and try to put that very large withdrawal through their checking account. Paypal even admitted changing it per their phone call to PP... Don't know about you folks but I would not have that kind of funds in any account associated with Paypal unless I put it there to pay for an item.
**************
Can't touch this! uh huh, uh huh.
posted on January 17, 2006 07:17:30 PM
I guess I am confused, did they make a paypal payment via their own credit card, and paypal changed that to echeck? My guess is that burried in the fine print, they have the option to do that. Not sure how many merchants will take that large of a payment with paypal, I know I wouldn't!
posted on January 17, 2006 07:50:02 PM
"I guess I am confused, did they make a paypal payment via their own credit card, and paypal changed that to echeck?"
Yes. Paypal changed their credit card pay to echeck.
& yes I would not pay that large of an amount with Paypal either and Sis-in-law didn't want to either but the seller takes only Paypal.. Needless to say they are backing out of the whole deal with all the underhandedness of Paypal going on and the fact that Paypal told them to let the echeck go through and THEN they would refund it back to their Paypal account. ME thinks they talked to a real dumba$$ at Paypal.....
Also found out this last tid bit and that is what really jerked their chain Paypal telling them to let the echeck go through and then be refunded? Sis-in-law was flabbergasted at the proposition. Look what kind of headache that would cause waiting PP month or 2 to get back money that was not in your account causing your account to belly up bounce any outstanding checks overdraft fees you name it aside from being put on a list for hot checks or anything else. What Gall PP has to tell them let it go through and we will refund. I got to laugh at that super stupid statement. Problem is is that sis's bank pays any overdrafts and that is where all the extra charges would have come to effect if it had gone through. In other words paid overdrafts but charges incurred for each instance etc. Get the picture?
posted on January 18, 2006 06:08:23 AM
Did they have a balance in their PayPal account when they made that payment? It seems to me that PP's first choice when you make a payment is your balance, and if there is not enough in the PP account, it will not let you pay with a credit card but default to a bank withdrawal.
I think I got around that by emptying the PP account to zero, and then paying with a credit card. It took several hoops around the system to do it that way. But I do believe it told me at every step just what was happening.
It seems hard to believe that PP unilaterally took it upon themselves (it's an automated system, after all, not a PP employee making decisions at this point) to simply change it somewhere in midair. Or afterwards? The instant email that is generated after a payment said what? Bank transfer or credit card? And there should be an option to cancel payment at that point -- instead of stopping payment on a check at the bank. Yes?
Note that I'm not part of a PP cheerleading squad, and I am not doubting that this took place. But I also know that unless I'm paying attention, sometimes I'll hit the incorrect button at the wrong time.
