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Thread: Suing Paypal- BEWARE Everyone- They are worse than Satan!

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    Default Suing PayPal / Beware: Closed account out, yet still grabbing my ankles!

    Hi All,

    I have a unique case as a seller. I opened my account well over a decade ago and then closed my account with PayPal after learning about their recent policy updates thru the news, then investigating and reading the awful accounts as to how the firm now operates. I did my due diligence- all financial information was removed, and the associated bank account was closed. I received a confirmation e-mail from PayPal notating the date and time the account was fully closed. They are a "service provider" so I thought that was the end of it.

    There-after, I received an e-mail from PayPal that a buyer later filed a SNED dispute on used (and apparently now damaged electronics) he had purchased previously from craigslist using paypal a full 6 weeks after delivery and that funds were removed from my now "closed account". The circumstances with this transaction were that the buyer initially requested an additional 50% discount or threatened a return and/or chargeback thru AMEX which I refused; at which point the buyer immediately escalated the dispute to a claim.

    Under no legal obligation but in good faith, I immediately contacted PayPal and coordinated with a supervisor, and provided paypal with everything they requested- a copy of the original used electronics craigslist ad, screen shots, e-mails, tracking info, etc. to refute the buyers excuses and to reduce risk of loss. As I am not a member- I e-mailed the files to their 'ica-na@paypal.com' address which was added to the record.

    Regardless, an automated e-mail was immediately dispatched within 24 hours (probably from their center in India) stating they decided in favor of the buyer and a return was warranted, which was odd- as it was well documented that neither party ever sought that resolution. It could have been quickly and easily resolved with a minor credit.

    After coordinating with 4 different managers and, providing additional information to meet their obnoxious requirements, several managers agreed that I provided everything one could reasonably expect to prove that there was no basis for a return or refund per section 13 of PayPal's SNED policies. As it was an off-ebay transaction and had been 5 months since the original craigslist ad was placed, I really went above and beyond and provided screen shots and went as far as to provide indexed search engine results proving the items were purchased used, and that no material misrepresentation had in fact occurred.

    PayPal sent an e-mail stating that they had reversed their initial determination, and were still investigating the matter. I was informed by a manager that the seller had been notified as such. I even went so far as to extend a counter-offer for a partial discount at that time to the buyer in good faith.

    However, I was then informed a day or so later by PayPal by phone that the seller opted instead to circumvent the process and force an adverse determination to the seller by initiating an unauthorized return. Upon the buyer providing the return tracking information to PayPal, they immediately dispatched mails stating they believe the buyer was due a refund.

    They were informed on several occasions the unauthorized return would not be accepted, and the package would instead be diverted and held at a 3rd party holding facility until a proper resolution could be reached. If not re-claimed in due time by buyer then it would be discarded.


    I believe these are the relevant points:

    1) Unfair Dispute Resolution- It is well documented that PayPal has an unsavory reputation for being one-sided and favors buyers. They do not honor their own policies and their decisions are completely arbitrary. My experience is that even if you build a strong case using the relevant facts and their own policies pertaining to the dispute, they always make a determination which is the most advantageous to *PayPal*.

    Currently, their business model seems predicated on cramming bad returns up sellers asses every chance they get, while they still collect their fees and market the safety of their payment platform to buyers as they try and steal market-share from Apple, Samsung, and Square in advance of their split from ebay.


    2) Hidden Policy Updates- PayPal seems to believe the "latest" version of their terms are what applies in every case, and they change their "service terms" like underwear. It is like opening a checking account, only to have the bank change the terms on you whenever they feel like it without notice. It's just not right for a financial firm. Their is no clear disclosure here.

    I became a PayPal member over a decade ago, and agreed to a set of terms. As an infrequent user, I was never provided notice, nor per the e-sign act did I provide consent to many of these recent policy updates. My interaction with PayPal suggests that these legally binding financial terms cannot be audited nor reproduced as required by the e-sign act.

    Like any reasonable person- had PayPal provided clear disclosure that by continuing to use their platform I would be agreeing to accept a return on used electronics off craigslist for any reason for six months, I like most sellers would never choose to accept a payment thru their platform. That would be a buyers warranty or buyers guarantee which of course was not paid for in this instance.


    3) Continued Obligations- Upon closing an account with PayPal, no consumer should be subject to their adverse actions- such as being forced to continue to accept their negative determinations and fees. I do not believe they should be able to say that they can still do whatever they want such as processing returns, posting fees, and exposing sellers to on-going fraud, and pursuing collections- even after you close your account out cleanly with a zero balance. Their are reports of buyers continuing to get e-mails about their accounts years later. When are you ever really done with them? Never apparently. On the front-end they claim to be a "service" but then don't behave like one when it's not convenient for them.


    4) Misuse of customer personal financial data- In pursuing a "premiere" account over a decade ago paypal provided an option for SSN verification. They marketed that by providing it, they would extend greater access. However, in years past they now use this data for alternative purposes such as auto-enlisting customers in credit products (which they were just sued for and settled on) and pursuing collection activities.

    If at the time the data was provided it was for one purpose, I believe it is highly suspect that they have the right to later use it for a different purpose- just because they may still happen to have access to it. Stating that they can further obtain consumer financial information from affiliates or methods I don't even know about- means ultimately a consumer would effectively have zero knowledge or control and raises serious legal questions.

    Certainly, few users would have ever provided such personal information as a SSN to PayPal knowing they would be later subject to adverse credit actions and disclosure to 3rd parties. That simply wasn't the type of relationship which had been marketed nor agreed to. As a customer, it is reasonable that I should have control over how the personal financial or medical data I provide firms can be used.


    5) Abusive Consumer bullying- In this particular case, they have attempted to bully / strong-arm a non-member into accepting a bad return with no recourse which more than likely they don't even have the right to do. If they want to provide the buyer a completely unnecessary/unwarranted refund contrary to their stated policies, so they can now garner greater buyer market-share- my opinion is they should be the ones to pay for it- as sellers such as myself do not receive any benefit from assuming those losses. I guess I missed the investors meeting and my equity stake.


    Thoughts:

    I have a fair question for everyone. I've had the opportunity to do a lot of research (a thank you is owed to the forum moderator). Who the fuck do they think they are? A payment processor, an escrow company, a bank, a loan provider? I would be willing to bet their executives just play off all sides to regulators, while using the "tricks and traps" with consumers to escape culpability for their actions such as this bullshit 27 page UA, banks in states with fringe laws, and courts in Russia. The reality is they are way to actively involved in every aspect of the transaction process to be considered "a facilitator" and even go so far as to say in plain speak that they want to do whatever they want.

    After reading their UA, their legal approach reminds me a lot of the PayDay lenders on Indian Reservations whom recently got shut down by having their ACH authorization/line pulled. Their needs to be real gifts of accountability here - the kind that only pulling lines, billion dollar fines, and jail time can provide. The real solution here is they need to have their corporate veil pierced by the CFPB, loose their privileges, and have their executives start going to jail.

    In my personal case I've spent the couple of bucks, I have filed suit in my county, and they better call Saul. I am no longer a PayPal member and I am not subject to their on-going adverse determinations, fees, arbitration, and bullshit. I'll even be happy to pay them and still pursue it.

    Personal circumstances non-withstanding - I have also filed with the CFPB, and will be reaching out to my state's AG's office, and the FTC this week to enforce the above points & promote the real change that needs to happen here- as my understanding is this isn't the first time they have reached settlements with them for their abusive conduct (which now happens to be a real legal term).

    Of course, any help from the wider community or from sellers with similar circumstances would of course be appreciated.
    Last edited by PaypalAreShysters; 07-06-2015 at 10:41 PM.

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