When Russell contacted PayPal about what appeared to be fraud on his account, he rather naively assumed that his being proactive would pay off, and keep his checking account balance safe from the fraudsters. Not so fast! He wants to warn others not to be naive enough to actually believe what PayPal says.

I am writing to relay a story your readers might be able to learn from. Exactly one month ago today 1/15/11 I awoke to three emails “confirming” three eChecks addressed to people who’s names I did not recognize in the amount of $375.00. My heart skipped a beat and I immediately logged into my PayPal account only to find that someone
must have somehow hacked my account (I had a strong password that I never shared) and sent themselves this money.

I filed a claim with PayPal immediately and even called my bank to warn them of the problem and transfer my money from the checking account I have linked to PayPal to another account PayPal does not have access to. I called PayPal and after winding my way through a maze of phone trees (seriously it took me over five minutes just to get past the computer) the customer agent “S” confirmed to me that no money would be transferred from my linked bank accounts until the investigation had been resolved.

Four days later PayPal attempted three unauthorized transfers from my checking account and I incurred $87 in returned check fees. To add insult to injury PayPal sent me an email the next morning letting me know they had resolved my dispute in my favor. Six days later PayPal once again attempted three more transfers from my checking account racking up another $87 in fees. I called PayPal and after once again winding my way through their nearly impenetrable phone menu (saying agent is humorous, the computer acknowledges your request but then keeps asking questions and pointing you to the website) I spoke with [T] who informed me that even though PayPal had been informed these eChecks were fraudulent just four hours after they were filed and even though I had been assured no money would be transferred and even though they did so six days AFTER they had closed my claim that PayPal was not going to give me a cent of my $174 back. I didn’t even receive an apology for their EPIC failure.

Luckily I bank with Navy Federal Credit Union and after 10 minutes (total call time – less time than I even spent on hold with PayPal) they refunded all of the fees and apologized for the inconvenience that they didn’t even cause.

I have closed my PayPal account, people should realize that using PayPal is like a bank, a bank that cannot easily be reached by phone and that has no interest in your financial well-being. Oh and if you can get a Navy Federal account, do it, they’re amazing!

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