Well, it finally happened to me. I've written countless stories about online fraud and how not to get ripped off. I've advised everyone to "be careful out there." I even followed most of my own advice.
And still I got ripped off.
Not for a lot, mind you, but for a $15 item in one of my eBay stores. Even though it was not a large loss, it left me feeling angry, frustrated and helpless. I've only been burglarized once, and I felt much the same way then.
The first I knew of this was when I received an e-mail from "service@PayPal.com" with the subject line "Notice of Transaction Review" and the following statement in the body:
"We regret to inform you that you received funds from an account with reports of fraudulent bank account use. In accordance with PayPal's Seller Protection Policy, the following transaction involving unauthorized funds has been reversed."
Seller Protection Policy? That sounds more like seller non-protection if you ask me.
The e-mail from PayPal continued:
"The transaction was reversed because you were not covered by PayPal's Seller Protection Policy. Please note that this withholding is in accordance with our User Agreement, Section VII, Paragraph 3."
They concluded this by saying, "Sincerely, PayPal ACH Returns Department." And oh, yes, do not bother to reply to this e-mail, as "Mail sent to this address cannot be answered."
In a nutshell, somebody has ripped me off, I have had a chargeback to my account on merchandise I shipped out in good faith, and I can't even talk to PayPal about it.
E-commerce, ya gotta love it.
Ironically, it turns out there is no Section VII, Paragraph 3, at least not that I could find. And no, I didn't memorize the entire user agreement before signing up (does anybody?). So yes, I deserve everything I got. And there are enough caveats in the user agreement that I could find more than a couple that disqualified me from any form of seller protection.
The principal one has to do with shipping to an unconfirmed address. Like a lot of eBay merchants, we are doing this e-commerce thing to make money, not to clean out our attic, and we pretty much ship to anyone who pays in advance, regardless of whether the address is confirmed by PayPal or not.
If we waited or asked each of our customers with an address as yet unconfirmed by PayPal to go through that process, I think we might lose a third of our sales. We already have an awful lot of customers who are very reluctant to pay for merchandise over the Internet.
I actually think I've been lucky that this hasn't happened before. It's probably because we are selling orchids and garden products, not highly coveted items like laptops and PDAs.
eBay itself does not make it particularly easy to take any action about buyers who defraud sellers. In fact, under its "Selling Related Links" section, there is nothing that tells you what to do if you have been ripped off. Ditto on the first page of the new Seller Central section.
However I was able to block this particular eBay user ID from ever buying anything from me again. Of course, user IDs are like eyebrows, everybody has at least two and some folks have a lot more.
I looked up my buyer's feedback and discovered that this person had also ripped off another merchant. I know, I could look up the feedbacks on every buyer, but who has the time?
I wrote to my fellow victim and she said, "This is the second time this has happened to me and the first time, I went through the hoops and absolutely nothing was done. It was for a small amount on me also, so I'm just going to go on. It's a real shame though."
The small amount thing has me puzzled. Maybe it's just kids, or maybe it's serious crooks testing the PayPal system on small-potatoes stuff.
In any case, PayPal on eBay has some recommendations for sellers who want to avoid being defrauded. But almost every piece of advice involves more work for the struggling merchant, or narrows the pool of people from whom you receive payments.
I'm not going to change my ways just yet (we pride ourselves on that fast shipping and I continue to believe most folks are honest) but I certainly will be more careful on larger-ticket items in the future.
Getting ripped off even for a few bucks is just no fun at all.
Adapted from E-Commerce Guide.com.