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I wanted to buy you a latte, but it seems you only accept Paypal. I've seen warnings about Paypal - Paypal fraud, Paypal phishing and the like, so I've avoided Paypal completely. I don't want to get my Paypal account hacked. Am I over reacting? Should I avoid Paypal? Personally, I'm always a little mystified when I hear of folks who don't like Paypal, or who are afraid of it. You just have to treat it for what it is: another on-line banking service. Personally I find it fast, convenient and reliable. Are there horror stories? Of course. But then, the same's true for whatever institution you keep your money in. There are definitely some steps you can take to keep your Paypal account safe. First, even though I said Paypal is "like" a bank, they are not, actually, a bank. As a result, they are not subject to some of the rules and regulations that banks are. Knowing that, I simply choose to not keep large amounts of money with Paypal. The horror story that I hear the most frequently (important: I'm not saying I hear it often, just that of the infrequent stories I hear, it's the most common) is an account lock-out. If Paypal suddenly decides to restrict access to your account, (typically as part of some fraud investigation) just make sure that they're not holding a lot of your money while things get sorted out. So, how do have a Paypal account, and keep it safe? Pretty much the same way you keep your bank account's on-line access safe.
"...if you're OK with online banking, then there's no
reason at all, in my opinion, to avoid Paypal."
Most all of that is simply common sense, or "best practices" for accessing any account on line. Now, do you use on-line services from your bank, brokerage house, credit card company, or other financial institution? In that list I just provided, replace the name "Paypal" with the name of the institution you use. That exact same list of precautions applies to any online banking service just as it does to Paypal. So if you're OK with online banking, then there's no reason at all, in my opinion, to avoid Paypal. In fact, there's every reason to add it to your mix, as a fast and convenient way to make payments online. Personally, I've used it for years. I actually have three accounts: personal, my wife's business, and my business. It's been particularly helpful with my wife's business as she's taken more internet sales. Related:
Article 10298 | Posted May 16, 2006 |
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Leo you're right about 1 thing - keep your balance low and 2) have a backup processor like StormPay or even better an actual merchant account, because if you deal with PayPal long enough and often enough you WILL run into a problem that may range from an inconvenience to a business threatening freeze. Since they are not a bank, and are very careful not to become one, they do NOT have to follow banking laws or regulations and can pretty much do whatever the heck they can get away with. I disagree with your overall tone, although I agree they re necessary to serious oline businesses anymore - they are necessary as in "necessary evil".
Posted by: Chuck at November 21, 2007 12:52 AMI agree with others. The rosy picture painted is belied by the statement to withdraw money as frequently as possible. If this was a trustworthy service that would not be required.
The statement that PayPal is "like" a bank is erroneous. It has not covered by any banking laws and unlike a bank your funds are not secured.
The irony is as everyone says that until you have a bad experience with them you simply don't know how bad an experience that can be.
By the way StormPay is a dubious option.
A proper online merchant account is the only alternative.
Posted by: frozen at December 17, 2007 03:40 PMPaypal has been concealing a defect in its anti-fraud software that produces "false positives". Their failure to disclose this fact constitutes fraudulent misrepresentation when they tell members that the only way they can get their accounts "limited" is if they violate the contract. Papal knows that this is not true. Members can get their accounts limited without good cause due to false positives; but Paypal fails to tell members of this danger so Paypal can keep registering new members and keeping old ones. Paypal has been sued in New York and there is a hearing on January 23, 2008. You can read the memorandum of law filed in that lawsuit that will disclose the complete allegations against them:
Memo. of Law
http://www.theultimatehit.com/PaypalLawsuit/PlaintiffMemoLaw.html
Posted by: David at December 20, 2007 01:11 PMMr. Notenboom,
I must agree with some of the comments here when they state that you don't know what you are talking about. You statement about Paypal is so limited that it does not exhibit any extensive knowledge on how Paypal's software actually functions.
Are you aware that if a buyer sends money to say 10 sellers and 1 of those sellers immediately transfers the funds to their bank account Paypal's software has been known to freeze all 11 accounts. Paypal is then incapable of reviewing all the frozen accounts in a timely manner due to their lack of employees in that department that they refuse to release the funds and require the sellers to wait 180 days because they don't want to take a hit from a charge back if the buyer files for one. This is due to Paypal's own negligence in failing to timely review and release funds. Paypal then sends out emails that falsely claims that an investigation is occurring. When Paypal also tends to release a percentage of the frozen accounts without an investigation due to their desire to protect themselves from lawsuits. This allows them to say they are investigating and releasing funds. This comes from a manager who worked at Paypal.
Posted by: David at December 20, 2007 01:20 PMOne last point. You comment that the majority of paypal members have not had a bad experience is ridiculous. Why? because you fail to realize that besides thousands of members being seriously harmed, there is a great potential that those member will be harmed too.
Are you even aware that people are getting arrested due to Paypal's defective software?
What do you think will happen if you sell something and Paypal's software freezes your account and spits out an email telling your buyer that your under suspicion of fraud. Unfortunately for Matt Mill in 2004 and Sarah Holland in 2007, their police office clients used Paypal's email to have them arrested falsely for "felony Internet fraud". Or how about Ms. Frost who lost her job when a member sent Paypal's email to her boss accusing her of fraud. There are thousands of cases like this.
For you to simply dismiss these thousands of people and say well Paypal is ok just show what type of person you are and that isn't very good. It makes me think what kind of morals or ethics do you have that you can dismiss these innocent people.
Posted by: David at December 20, 2007 01:27 PMI would suggest to never deal with paypal,in my case it was not even a ebay issue, I was selling an animal to a lady in Texas who wanted to pay me thru paypal ,I had an account that I had occasionally used on ebay,anyway she transfers the money from her bank to my paypal,so I transferred it from my paypal acct. to my bank acct.I would never leave money sit in paypal because they are not fdic. I waited a couple days for the money to transfer and they stopped the transfer and froze my account.Fortunately I had not shipped the animal yet,but the buyers money was frozen in my paypal acct.and with no reason,just because they felt like it. After being nice didn't work I made a bunch of threatening emails and phone calls and finally got them to transfer the money from my paypal acct. back to the buyers paypal acct.where it is still frozen and maybe for some time to come, it was almost $ 3000.00 tied up until they decide to give it back,if they give it back,and all this was without cause,,,just because they could.Unless you like being jerked around and losing control of your money and maybe losing it altogether.NEVER NEVER NEVER DEAL WITH PAYPAL sooner or later they will get you!!!!!
Posted by: Jeff Cox at February 25, 2008 11:33 PMPay Pal froze my account because of my credit. Then they give me a number to equifax who wants to sell me a credit report. They froze 1500 bucks I needed to eat off for the month. My family is starving and we are eating hot dogs and balogna without bread because of Pay Pal THE PAL YOU PAY!
Posted by: Pay Pal Blows at March 25, 2008 02:53 PMHi, I know a company called Claim and Collect Ltd which specialise in recovering losses incurred through Paypal on a no win no fee basis. This covers cases of chargebacks, reversed payments or goods not received in the last six years. Visit www.claimandcollect.com for full details or call them on 0800 030 4624.
Posted by: Annabel at April 10, 2008 05:53 AMJust like an ordinary bank?! And I thought I was naive. I was one of those previously happy to use Paypal people until a couple of weeks ago. Sold tickets for a gig through Paypal which the buyer lost - sorry, but not my problem! I had positive feedback confirming speedy receipt and an email confirming receipt and subsequent loss. 3 weeks ago and chargeback time! Paypal gave me 10 days to respond and said that they would have 75 days to consider this response. I responded in 1 but received an email, sent before my response, advising that there was nothing they could do and that they were closing the case. They have stated that their decision is despite my feedback, but given the timings of emails, they could not have given due consideration to my feedback. They have also stated that they have passed on all the information to the card company, but again this was impossibleThey are doing nothing with my proof of receipt, are not sending this on to the card company concerned, and generally, despite their protestations of powerlessness and faux expressions of sympathy, seem disinterested. Their last email suggested I ask the buyer for the money back or for the 'return of the merchandise'! Not much use when the merchandise was tickets that have been lost, and I somehow doubt that a buyer will respond to a polite request for my money back! I'm so angry!
Posted by: Cocteau8 at July 24, 2008 03:33 AMPayPal blows chunks. There is nothing convenient about it. They will keep your money at their whim for reasons they won't disclose. It costs you great amounts of time to try to get it fixed. I use computers and do electronic transactions daily, but will not use PayPal again - trouble is, they won't let me close my account! No one needs this kind of brain damage, and even if I have to deal with payment via snail mail, it is well worth it, because at least I know I will get it eventally. Can't say that for PayPal.
Posted by: Scott at July 29, 2008 07:11 PM