Scammers Be Scamming – My Experience With A PayPal Chargeback

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Dealing With A PayPal Chargeback

Dealing With A PayPal Chargeback

Scammers on eBay and Amazon have been in the news a lot lately. Whether it was the couple that scammed $1.2 million from Amazon, using the two address method, or the return a rock method the reports seem to be on the rise.

I have to admit I have been extremely lucky on eBay and I had never had a run in with a scammer…until now.

Details of the Sale

As you may have heard Amazon had a pretty amazing sale on Kindles not too long ago.  I even shared how I did selling them.  Well, a week or so after posting my results I received a chargeback alert from PayPal.

When selling the Kindles I had run into a 3 different buyers with low or no feedback on eBay.  Of course this is a huge red flag.  I decided to be extra cautious with these buyers and document as much as possible.  I took pictures of the Kindle’s UPCs next to the prepaid shipping form.  The scammer in question had actually ordered two Kindles. I made sure to send him a message that both would be in the same box even though he bought them separately.  He responded and agreed with combining the shipment, which made me feel like he was more legit at the time.

Turns out two of the three buyers started getting ratings over the next few days.  It seems like they were legit buyers just starting out.  The scammer never got another rating. I usually hold off giving feedback on anyone with a score under 10 until a few weeks after they receive their item.

Dealing With A PayPal Chargeback

PayPal Notifies Me of Chargeback

It had been a few weeks since the scammer received the item so I thought I was in the clear with my three eBay newbies.  Then I received the email from PayPal that there was a chargeback on one of the two kindles that I sold to the scammer. He claimed that it was an unauthorized transaction.

Two things stuck out to me.  The first one was that he filed the claim with PayPal and not with eBay. The second was that he didn’t file them both at the same time.

I jumped into action right away.  I filled out the form on PayPal and submitted the following info:

  • The tracking number.
  • Date the scammer received the item.
  • The pictures I took of the UPC and the shipping slip together.
  • A screenshot showing the packing slip matched the PayPal confirmed address.
  • A copy of the message that I sent about both being in one box and his agreeing to it. My thinking was that he may be trying to say he only received one of the two Kindles in the mail. And that may have been why he only did a chargeback on one.
  • I also explained that I was a seasoned eBay seller and this was a 0 feedback buyer.

I am pretty sure that only proof of delivery was needed for this type of claim. But, in a situation like this I go with the “better safe than sorry” mantra.

At this point I decided to call eBay and alert them to the issue, because the first one to talk with a live agent usually wins.  I wanted to make sure that eBay was aware of the issue and notate it on the second Kindle in case he filed that claim through eBay.  The rep did clarify that once a person files a claim with PayPal they can not file a claim with eBay.  The two companies seem to have a double jeopardy kind of rule.

A few hours later the chargeback on the second Kindle came through and I filled out the form and sent the same information as before.

Let the Wait Begin

I gave it 1-2 weeks and didn’t hear anything from PayPal.  Thinking this would be wrapped up in a week I started to grow a little impatient.  I decided giving PayPal a call wouldn’t hurt.

After a brief hold I was informed that the scammer actually filed the chargeback with their credit card company vs through PayPal directly.  This made a lot of sense to me.  It explained why the chargebacks came through PayPal and not eBay and also why they came hours apart.

The PayPal rep also informed me that the address on the credit card matched the verified PayPal shipping address.  The scammer also had to go through PayPal verification to place the order. For once the PayPal loop was a good thing haha.  And for the trifecta the IP address matched the shipping and credit card address.  The dude was sunk!!!

I knew at that point it was just a waiting game until I would get my money back.  PayPal still had a few weeks to respond to the credit card company according to the rep so it should be wrapped up by then. I received two identical emails a few days ago wrapping up both cases.

Dealing With A PayPal Chargeback

Most Annoying Part of the Ordeal

It is annoying to get scammed and you may think that having your funds tied up for three weeks may be the worst part.  That wasn’t the case for me, it was only $70 after all.  The worst part was that it made my account negative.  And the two options to make the balance positive were not the best.

I could pay off my negative balance with a credit card which would post instantly but it would be billed as a cash advance.  I am not sure why PayPal couldn’t charge the standard 3% but that wasn’t an option.  The other option was a bank transfer but it would take 2-3 days to post, not ideal.  I went ahead and initiated the bank transfer.

The very next day I ran into an issue when a PPDG sale was going on. PayPal would not let me complete the purchase with a negative balance.  I was able to get two single gift card purchases done before I hit a wall. That is when my travel hacking brain kicked in and I transferred money from my wife’s PayPal account to my own.  This wiped out the negative balance instantly.  A friend or family member transferring the money to your PayPal account seems to be the quickest way to to deal with a negative PayPal balance.

Conclusion

At the end of the day the scammer lost and I won so chalk one up for the good guys! I know some will say I should cancel the order of any 0 rated buyer.  I considered it but I didn’t want to risk a negative feedback rating from the preemptive cancellation. There is nothing in the eBay terms that allows this either.  We all started out at zero at some point, and these were not expensive items, so I figured maintaining a 100% feedback score was worth the risk.  It all worked out in the long run.

I would suggest keeping good records for any buyers with low feedback or any buyers that do not carry 100% feedback. It will probably come in handy at some point.  I also think that winning these type of cases is much easier with eBay than it is with Amazon.

 

Let us know about your scammer stories in the comments and how it ended up working out!

 

 

41 COMMENTS

  1. Hi, I just received another chargeback notification email from Paypal recently. I sold small religious items on ebay for a couple of years. The first time happened to me during last year. After the first chargeback, I started to look out suspicious areas like what you mentioned above, eg. new account (the join date is the same as the purchase day), funny account name, low scoring rate, like to order 2-3 items at a time. I did cancelled a few orders because of those suspicious points. After losing once, hopefully by cancelling orders can prevent me from having another misfortunes. So far so good, however, until the one I received recently, it didn’t look suspicious to me, because the ebay account name is normal, with 10 scoring rate, paid through Paypal with paypal account instead of instant payment as a guest. I looked up the tracking a few days later and it shows delivered successfully. I have no clue this time why having a chargeback again. I feel so frustrated and lost, why and how to prevent those scammers, they are so annoying, trying to get money and no one can stop them even those big institutions. How the buyers proof it is an unauthorised transaction, what if they purchased something but saying it is not authorised? On contrary, if not because someone placed an order, with quantity, delivery address, payment, and a valid ebay account (in my case), why would I ship out my items. These seems sellers are more at risk than the buyers. Anyhow, I provided only a screenshot of the order placed on ebay and a proof of delivery address (the same on Paypal) with tracking reference on it, don’t know is sufficient enough. Now is the waiting time for the result. Lucky that I saw your website, and will start to consider giving feedback after the buyers leave theirs first. Apart from that, I don’t think I can do much to avoid such misfortune. (And I believe I am targeted by those scammers because as I mentioned before, the items I’m selling are not trendy, valuable, popular items like goods out there, just religious items, only those who know and feel interested may have the genuine intention to purchase, otherwise, more likely is by scammers). Anyway, thanks and good luck for all those who facing similar matters.

  2. We have a graphic design company. We had a customer file a claim against us through his CC company then they notified pay pal which pay pal notified us of a claim. Psy pal hasnt charged us back, they are investigating the claim and we have provided our proof. He had given us a 50%deposit which is required to start the jobs and get the process started. We had installed 3 out of 4 signs to a customer and the customer was suppose to drop off a trailer to put a wrap on it, wrap us printed and ready to e installed. The customer has delayed for weeks dropping it off and the last sign the customer had agreed he would pay the balance in cash along with the final balance of the trailer. He never showed up to drop off the trailer and he said there was a change of plan. Meanwhile he has already put the claim in but we didnt have the trailer to wrap. He’s claiming he didnt receive his merchandise. He has in the meantime received a credit back from American Express and he has called us since then wanting to know if he is getting the wrap installed and he wants his sign. Pay pal has the claim still and we have sent all the proof we have on what’s happened between us and the buyer. So he got a provisional credit, we told him to cancel/stop the claim. He said he would and he hasn’t but he still wants to know where his sign is. We dont want to move forward until the claim is dropped because he has a credit, pay pal is investigating whether or not they’ll charge us back, and he wants the last sign and wrap but if we do then well be out the money he gave us for the deposit.

    • Sorry to hear this. I would suggest getting an attorney involved myself. Having said that I agree with your last statement.

  3. Too bad that the scammer still wins, he got the money and the item, only PayPal’s insurance company loss by paying up the seller protection.

  4. If you have an ebay store, you get reduced fees for selling. (For example, computers and tablets are only 4% final value fee instead of 10%) However, if you cancel auctions after they have already been paid for, then you get a 4% penalty tacked onto your final value fees for the next few months. So the cancelling purchases with 0 feedback is not really an option for people who have an ebay store.

  5. I’ve sold exactly 2 items on eBay. One I met was a scammer, the other a avid eBay user who was willing to use scammer tactics to get an discount after the fact. Electronics… really not wanting to sell them on here anymore. The first item was an Alienware Laptop. Which worked great and was in used condition as described. I sold it to make up for the visual flaws at 300 USD. (Computer originally was purchased for 1499 USD) huge markdown as it was. Anyhow, the guy comes at me saying it wasn’t as described opens a case and the money is taken from my PayPal. We chat and he claims the computer is missing the hard drive and all of the memory. Which I know for a fact was present when I shipped it. I explained that I bought the insurance from the post office and would return the item for him, but he responded with…knock the price down to 200 and I’ll be happy and leave good feedback. I did so because at this point it would be the least pain in the butt. And suddenly he was completely happy:

    Second item was an Apple Watch. I included original packaging and the watch was on great condition when so shipped it to an address on Florida. It was delivered to the address over a week ago and today the customer sends a message saying the watch doesn’t work. Also says that he just received the watch in the Dominican Republic where there are apparently no genius bars to confirm the serial number of the watch.

    I fear this is the item swap scam that’s been on the rise. What do I do? The watch worked fine. His arguments make it sound like he’s really trying to make it work and I’m almost sympathetic even though I know it was workin and even took pictures of it working before I sent the watch.

  6. Unauthorized transaction generally mean the CC was stolen. I typically check using spokeo for high dollar amounts to see if the seller really lives at the address. Common tip-off is that their is a difference between the payer name and where it’s going (though both are authorized)

    Doesn’t really matter because PayPal will generally cover it if u followed their rules, usually it’s an Apple product that’s being ripped off though I did have a dewalt drill and a Samsung tablet in the past.

    • Good pointers John. Sounds like PayPal had him dead to rights though…IP address matched the address on the card and they had to verify via PayPal before the purchase. Hopefully they were able to win the case with the card provider too.

      There were different names on the shipment address and the eBay name/email – and that did make my spidey sense tingle.

  7. I’m unclear as to what the buyers stated issue was? Item not received?

    I had a guy reshrink wrap a MacBook Air and return it to me filled with clay. Fortunately he was a college student and I tracked his dad down who intervened (I found solid proof of what he was doing) and it worked out.

  8. i’ve been selling on ebay for a long time. in all my listings i say ‘after you get your item, please let me know that you are happy with it by leaving me positive feedback and i will do the same for you’. i never give feedback first.

  9. I’m dealing with a headache from a GoPro I sold a few weeks ago. New eBay account, but I had already cancelled one order the day before for a zero feedback account and was told by eBay I can’t do that. So this one went through. Received an email from eBay saying the buyer had paid and to ship the item. I did. Turns out the payment was pending (PayPal did not have the funds, only showed it as pending). I’ve been communicating with eBay and PayPal as far as what to do. Neither seems inclined to help since they think it’s really my fault for shipping before the funds were actually confirmed. Buyer obviously has no incentive to pay now because they already have the camera. So I’m pretty much out of luck.

    • I had that happen once when they didn’t have enough funds in the account. Luckily they still made the payment even though I had shipped it. I hope it works out for you. Any chance of getting the shipment halted and returned to you? I am not sure if that is even a thing.

  10. I have sold over 7,000 items on eBay over the last 20 years and I have definitely noticed an increase in scammers. Not exactly like your experience described above, but this year I have had four people tell me that they never received the package even though tracking showed it was delivered in mailbox. They all wanted a refund. I tell the person that I will gladly provide a refund once I have a Postal Inspector investigate the “theft” of their item. Miraculously three of the four items showed up the next day.

    • Good thinking on the postal inspector! Yeah it is sad – you would think eBay would be able to weed them out better.

      • Ebay does weed out the people who claim non delivery but for whom the delivery confirmation number shows delivered. Many sellers escalate those claims themselves, ebay sees it was delivered, closes it in the favor of the seller, and it can’t be reopened by the buyer.

  11. I had a similar experience selling a GoPro camera. Same outcome as you. I had verified the shipping address through ebay messages and all i had was the tracking info. Seems like if you ship using ebay label you stand a pretty good chance.

  12. I had something weird happen to me this week on ebay that I am still trying to make sense of. I am selling a few LOL Surprise Big Surprise toy (if you have a young daughter, you know what I am talking about). I sold one of them to a buyer from UK with 0 rating. The short story is that she (he?) never paid in the two days allotted before I could file a claim (ebay already charged me the sold fee). I sent her a reminder after 24 hours first. After two days, I filed the claim and now the buyer has another 4 days to pay or get the ax and for me to get a credit for the fee charged. Now, what was the purpose of this person’s actions? Anyone knows? Besides just bothering I mean… The only thing I can think of if that there was a buyer from the UK a day before that sent me a “best” offer that was lower than the retail price and of course I rejected it and explained that it was below retail, would she be so mad as to go through the work of doing all that and risking ebay linking her with her real account? Crazy people….

    • My guess would be they got it cheaper or quicker somewhere else and wanted to back out of the deal but were afraid to contact you.

  13. You are a GOOD GUY Mark. Wonderful strategy! Very impressive. So glad that you were brought on the team. What a great education you just provided all of us. Again Thanks so much. Lastly, who had phone #’s for EBay and PayPal???? Care to share for our records?

  14. It’s been a while since I’ve sold on eBay, but I do believe you can set up a listing to block buyers with a 0 feedback score. I always made my listings so that you had to have at least a 5, sometimes a 10 if it was a bigger item like a laptop.

    • Read what Andy said below. I don’t think that is an option anymore. Some people put it in their descriptions though.

  15. Yeah there should be a list of scammers with their full names and addresses. If you’re going to do something douche like that you deserve to get the public shaming

  16. Wish there could be a system where some sort of “punishment” is meted out on the scammer e.g. credit card company closing his account and confiscating his points. I hate scammers. Never been burnt but then again I’ve rarely sold stuff on ebay.

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