Refund Horror

We recently had dealings with paypal regarding a member of our site donating $10 USD using our sites donation button. The system is pretty simple and requires membership to our site to even use it. It also requires the member to select the amount and hit the conformation button before being routed to paypal. There the user must sign into their account or create one using their credit card information and email to submit payment. Bottom line is, there are countless numbers of steps a person must undertake before final commitment is confirmed of their intent. However, for some odd reason this member decided to change their mind and open a dispute with paypal asking for their $10 USD back stating their credit card was used without their permission. The funds were placed on temporary hold by paypal while paypal performed their own internal investigation. We were asked to provide them some information regarding the transaction, which we explained that this transaction was submitted in good faith through our membership donation page and that the member never wrote or responded to our own inquires. We went on to say that we understand mistake can be made and we were willing to refund the donated $10 USD even though our policy clearly states no refunds. We even were prepared to be hit with paypals "fixed fee" upon refund. However, since this member used their credit card and was not a verified paypal user, paypal prevented us from being able to submit the refund using their system the way it is. Paypal then took a few days reviewing the claim and made the decision to not refund the money stating paypal could not find any evidence of unauthorized access to the buyer's account. Paypal then released the funds. Case closed right? No. The user then opens a fraud claim with their credit card company towards paypal. Paypal then places the $10 USD on temporary hold and ask us for any information to help their investigation once more. At this point we're feeling
redundant in our position and restate the obvious and again state we are willing to refund the $10 USD. Paypal takes a few days or so to respond back to us and finally informs us that "The buyer's card company has reversed the charges for this payment. The
funds have been removed from your account at this time. And that "The credit card company has charged PayPal a settlement fee for this chargeback. According to the terms of the PayPal User Agreement, we debited your PayPal account to cover this fee". These settlement fees happen to be $20 USD and were deducted from us as well as the original $10 USD donation for a total of $30 USD for what started as a good faith donation by a registered member and a paypal user we lose money we can't afford. Oh' lets not forget about the original "Fixed Fee" from paypal we got hit with as well. Thanks Paypal!

Below is the sequence how the event unfolded.

1. Donate system has been used by USER on 09-19-11, 06:01.
2. An unauthorized account activity claim was recently filed against the
following transaction. 09-22-11
3. Paypal is investigating the following transaction. Submit info on 09-25-11
4. On 9-27-11 paypal wrote "We have completed our investigation of the transaction below and were unable to find evidence of unauthorized access to the buyer's account. This case was denied to the buyer and no funds were recovered from your account."
5. On 10-05-11 paypal writes "We were recently notified that one of your buyers filed a chargeback and asked the credit card issuer to reverse a payment made to you on Sep 19, 2011."
6. We submit requested evidence stating the donation system has multiple logins and confirmation as does paypal to confirm intent.
7. The buyer's card company has reversed the charges for this payment. The
funds have been removed from your account and a settlement fee for this
chargeback of $20 as well. 10-20-11

The thing that sticks out and sucks for us is that we tried and informed paypal to refund the $10 USD since their system would not allow us, but they decided not to do this or give us the option to and now we are force to pay a $20 USD "settlement fee".

We or a hobby base website ran in part on donations. The sad thing is paypal is taking our funds unfairly. If anyone has a heart and wish to help donate feel free to stop by and pay us a visit.
 

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