Read the tragic tale of this screwed eBay seller over on Metafilter. He did everything Paypal told him to do to avoid being scammed when he sold a cellphone, including, when the buyer returned the item, opening it in front of a police officer. Problem was, the buyer/scammer sent back a smashed gold cellphone instead of nice $500+ cellphone that was sold. Seller protection policy should apply, right? Nope, it doesn’t cover “items not as described.” Failure.
So, as a follow up, here is what happened. Spoiler alert: I was scammed in the end and learned that PayPal has absolutely no protection for sellers against the kind of scam that was used against me.
The buyer initially filed a claim that the very nice new cellphone I sent him as different in that it was black, not purple, and was significantly damaged, which it wasn’t. I responded in brief immediately, telling PayPal that I knew he was lying, and that I would dispute it. I called and spoke to a PayPal resolutions specialist twice, and then sent a long email describing every reason why I thought that the buyer’s claim was invalid. At the suggestion of the PayPal representatives, I included links to many different things, including high-res pictures of the cell phone that I took to show color and lack of damage, and web pages that indicated I had a much better reputation than the buyer and that I would have more to lose by trying a scam then I would by getting the money. After one month from the date of sale, exactly, I received an email saying that the buyer was allowed to return the item for a refund, and that he would receive the money as soon as he provided a tracking number. Which was clearly outrageous.
So I spent a very sleepless night, and the next day I called PayPal. They informed me that they would not release the money until I had a chance to see the item. I asked how to prove he sent me back something bogus, and they told me to only receive the item in the presence of a neutral police officer. I also checked my web server logs and saw that they had not even looked at any of the links I provided. I suspect that the case was not even reviewed by a human at this point.
A few days later, they forwarded me the tracking number, and I managed to get UPS to hold the package for me to pick up. Once I did that, they scamming buyer changed tactics (maybe he saw from the tracking that I was having the box held instead of delivered) and he filed a charge back with his credit card company. I checked with PayPal again, and they told me to go ahead with picking the box up in front of a police officer, and that provided with a police report, they would dispute the charge back. They also told me that about 70% of the time they were successful. Fortified with the idea I was doing the right thing and that I had a good chance of winning, off I went.
I spent an afternoon off work, and went to the UPS station. I told them what was going on, and the manager tried to get me to take the box and leave. I refused, and called the police non-emergency line. An officer came pretty quickly, and I received and opened the box in front of him. Sure enough, there was a smashed gold cellphone inside, and almost all the accessories were missing. The police office filed a report of theft that described what he had seen. A week later, I had to take another afternoon off to go to the Police records department to pick up copy of the report, which was a pain in the butt because they charged $5 and only took money orders. I faxed the report off to PayPal and waited to hear about getting my money back that they had held.
Today, they refused to contest the credit charge back. Yes, after sending me out twice to get the supporting evidence they asked for, they didn’t even do anything with it. Even though I had police evidence to show that what he sent back wasn’t what he claimed to have received, they chose to not do anything.
So I called PayPal again. I eventually talked to an escalation supervisor, and was informed that they only disputed charge backs that fell under their seller protection policy, which doesn’t in any way cover claims that the item was not as described. In fact, the 70% statistic that I heard earlier was in reference to things covered under the seller protection policy, and not any not as described scam. So in essence, everything I did a their direction to get the police report was a wasted effort, and I won’t get any of the time or money I spent doing it back.
The real lesson here is that, as a seller, you can absolutely positively get screwed selling something. All a scammer has to do is set up an account, buy some cheap things to rack up some positive feedback (if they want), and then claim you sent him a rock. At that point, unless you used an escrow service, you are screwed. And it takes a long time. For me it was seven weeks of stressing about it until today.
Sure, I complained and PayPal is forwarding my case to some special investigative unit, and they were kind enough to refund my fees, but all they will do is block the buyer in the future. The kicker – my only recourse is to sue, PayPal won’t release any documentation unless I have a supoena.
So there you have it. It used to be buyer beware, but for PayPal it is seller beware. Anyone can run this scam at least once and get away with it.