PayPal Surprise

dwallbaum · 07-08-2009, 11:46 AM

Gentlefolk;

Interested in comments from an eLiterate community.

I had a PayPal account which sent me an email saying that a substantial amount of money was being sent to a vendor. This was the standard confirmation email.

I had not authorized such a payment, but I didn't panic since I had no money in the PayPal account anyway. But I called the PayPal help line to discuss the issue.

Two things happened. One was apparently my PayPal account had been accessed using my logon credentials to place the order. Oooppss... But the second, more important issue was that since there was no money in the PayPal account, PayPal was accessing the associated checking account to transfer the money to the vendor.

I was not pleased.

PayPal support said that the EULA states this is their procedure. And after some digging, I did find that there is a hierarchy or accessing funds for purchases if there is insufficient funds in the PayPal account.

I was totally unaware that PayPal would do this, so PayPal and I had a spirited discussion about this.

Am I the only one who didn't know that PayPal would go after associated funds to settle purchase agreements? PayPal sd. they are not a bank, but a payment clearing house. I sd. my understanding was that if funds were not avail. in the PayPal account, the transaction could not be completed.

Apparently, there is no way to designate that ONLY PayPal funds be used for transactions.

Has anyone has other experiences like this with PayPal? And yes, I am cancelling my PayPal account as a result of this, which is a pity, for PayPal struck me as a really neat idea.

Thx!

Don

HarryT · 07-08-2009, 11:53 AM

I don't know about anyone else, but I certainly knew it. I never keep any money in my PayPal account - if I buy something with PayPal, it comes out of my bank account.

PayPal UK are a bank, by the way, regulated (as are all other British banks) by the Bank of England and the Financial Services Authority. That means that, for people in the UK, if a fraudulent transaction occurs, your money is fully protected.

The more important question to ask, in your case, is how somebody else obtained your logon credentials.

Peverel · 07-08-2009, 11:58 AM

Yes I was aware of this. I never keep any money in my PayPal Account and they just call down from my bank account. They do send me an email whenever a transaction occurs so I am aware of exactly what is happening.
Also my Bank tracks my account usage and last time I made an out of character paypal transaction (it was smaller than normal @ $1.99) they called me to confirm I had authorised the transaction.

Amalthia · 07-08-2009, 12:41 PM

I think it would be nice to have the option that money only comes from paypal. Once I found out they can draw on any associated cards I removed everything and added a low credit limit credit card to my pay pal account so if someone did get my login information it would not hurt too bad.

HistoryWes · 07-08-2009, 12:47 PM

I'm like most others here. I don't keep any money in Paypal and expect them to withdraw funds from the bank when needed. I think more people do this that transferring money before making a purchase.

The much bigger issue is account security. If someone was able to get your Paypal account information and password, chances are very good that some of your other information could be in danger, especially if you use the same passwords on multiple accounts. Change your passwords and notify any banks that have issued you credit cards you might have used online to issue you new ones, then cancel your old.

toomanybooks · 07-08-2009, 01:06 PM

I am a holdout. I refuse to use paypal as they have had too many security breaches in the past. I do not trust them with access to my money. A universal electronic payment scheme is a great idea, but it needs to be implemented in a more secure manner.

dwallbaum · 07-08-2009, 01:06 PM

Hmmm... thanks all... well, all this was news to me obviously.

Yeah, as for the issue of how the person got my PayPal credentials, that is a good question. I did use the password for PayPal on other online sites, and its possible (according to PP) that I had a virus that leaked out my password info.

So, I am trying to clean out my system (looking for a decent virus checker now.. suggestions?) but the malware checkers I am using having found anything.

It still seems to make more sense to me to have a firewall between a payment source and a vendor, and I thought PayPal was that firewall.

Fortunately, my bank could stop the transaction, and PayPal was standing behind their end saying the money would be immediately returned, but it doesn't make a lot of sense to even HAVE a PayPal acct. if they just access your bank acct. Why not just use a special credit card for online purchases then and cut out the PayPal middleman?

Still not pleased.

Thanks, all. Appreciate the responses.

Don

toomanybooks · 07-08-2009, 01:10 PM

http://free.avg.com/

I have had good results with this free program.

ruth1304 · 07-08-2009, 01:12 PM

Exactly the same thing happened to me recently. But I did realise that it would take money from my account if I had nothing in my paypal account. Paypal realised that the payment was unusual and put a block on the account. This meant that although I realised what had happened before the money was taken from my account, I couldn't report it as a problem. I did try. Lots

It was a complete pain to sort out, as I was away from home for a few days at the time and the withdrawal cleared out my account as well. I haven't cancelled my paypal account, but I have linked it to a credit card to prevent some of the problems I had this time.

RickyMaveety · 07-08-2009, 01:26 PM

Quote:

Originally Posted by dwallbaum

Gentlefolk;

Interested in comments from an eLiterate community.

I had a PayPal account which sent me an email saying that a substantial amount of money was being sent to a vendor. This was the standard confirmation email.

I had not authorized such a payment, but I didn't panic since I had no money in the PayPal account anyway. But I called the PayPal help line to discuss the issue.

Two things happened. One was apparently my PayPal account had been accessed using my logon credentials to place the order. Oooppss... But the second, more important issue was that since there was no money in the PayPal account, PayPal was accessing the associated checking account to transfer the money to the vendor.

I was not pleased.

PayPal support said that the EULA states this is their procedure. And after some digging, I did find that there is a hierarchy or accessing funds for purchases if there is insufficient funds in the PayPal account.

I was totally unaware that PayPal would do this, so PayPal and I had a spirited discussion about this.

Am I the only one who didn't know that PayPal would go after associated funds to settle purchase agreements? PayPal sd. they are not a bank, but a payment clearing house. I sd. my understanding was that if funds were not avail. in the PayPal account, the transaction could not be completed.

Apparently, there is no way to designate that ONLY PayPal funds be used for transactions.

Has anyone has other experiences like this with PayPal? And yes, I am cancelling my PayPal account as a result of this, which is a pity, for PayPal struck me as a really neat idea.

Thx!

Don

I knew about that policy from the beginning, which is why I would be very concerned if someone else knew my Paypal login information. It is also why I have a special (very low balance) bank account tagged to my Paypal account. I only transfer funds into that account if I am going to make a Paypal transaction. Other than that, it has about $10.00 in it.

wodin · 07-08-2009, 01:30 PM

Quote:

Originally Posted by toomanybooks

I am a holdout. I refuse to use paypal as they have had too many security breaches in the past. I do not trust them with access to my money. A universal electronic payment scheme is a great idea, but it needs to be implemented in a more secure manner.

X2

_______

DixieGal · 07-08-2009, 01:39 PM

You guys are scaring me! I use Paypal all the time, and the only time I had a problem was when I bought something off eBay, and the seller disappeared with my money. It was nothing at all, Paypal refunded my money within a few days after I called them, no questions asked. Well, a few questions, such as "What happened?," but otherwise, you get my drift.

dwallbaum, are you going to get a refund because of the fraud?

ruth1304 · 07-08-2009, 01:49 PM

When I finally managed to report the problem, PayPal investigated - which meant they contacted the seller. As soon as they did that the seller refunded my money, and my bank refunded the charges I incurred so I wasn't out of pocket in the end, it was just a bit scary.

When paypal know there's a problem they do investigate, and ask the seller to explain the transaction, because the fraud could be associated with the vendor or they could be a second victim of the crime. The transaction was $800, which is significantly more than any other paypal transaction I've ever made and I've only ever paid in dollars to US stores, so it was fairly obvious. Part of the problem was because paypal noticed it was strange and limited my access to the account until they could find out what was going on.

rgeorg · 07-08-2009, 01:54 PM

I knew about it. Our bank setup a new account and that is the account we link to PayPal. We xfer money into it when we buy something which triggers an automatic SMS-phone alert that has to be confirmed.

Perhaps a bit paranoid....

ruth1304 · 07-08-2009, 01:56 PM

Quote:

Originally Posted by rgeorg

Perhaps a bit paranoid....

Definitely not

07-08-2009, 11:46 AM	#1
dwallbaum Zealot Posts: 100 Karma: 77 Join Date: May 2009 Device: Kindle2	PayPal Surprise Gentlefolk; Interested in comments from an eLiterate community. I had a PayPal account which sent me an email saying that a substantial amount of money was being sent to a vendor. This was the standard confirmation email. I had not authorized such a payment, but I didn't panic since I had no money in the PayPal account anyway. But I called the PayPal help line to discuss the issue. Two things happened. One was apparently my PayPal account had been accessed using my logon credentials to place the order. Oooppss... But the second, more important issue was that since there was no money in the PayPal account, PayPal was accessing the associated checking account to transfer the money to the vendor. I was not pleased. PayPal support said that the EULA states this is their procedure. And after some digging, I did find that there is a hierarchy or accessing funds for purchases if there is insufficient funds in the PayPal account. I was totally unaware that PayPal would do this, so PayPal and I had a spirited discussion about this. Am I the only one who didn't know that PayPal would go after associated funds to settle purchase agreements? PayPal sd. they are not a bank, but a payment clearing house. I sd. my understanding was that if funds were not avail. in the PayPal account, the transaction could not be completed. Apparently, there is no way to designate that ONLY PayPal funds be used for transactions. Has anyone has other experiences like this with PayPal? And yes, I am cancelling my PayPal account as a result of this, which is a pity, for PayPal struck me as a really neat idea. Thx! Don

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07-08-2009, 11:53 AM	#2
HarryT eBook Enthusiast Posts: 85,544 Karma: 93383043 Join Date: Nov 2006 Location: UK Device: Kindle Oasis 2, iPad Pro 10.5", iPhone 6	I don't know about anyone else, but I certainly knew it. I never keep any money in my PayPal account - if I buy something with PayPal, it comes out of my bank account. PayPal UK are a bank, by the way, regulated (as are all other British banks) by the Bank of England and the Financial Services Authority. That means that, for people in the UK, if a fraudulent transaction occurs, your money is fully protected. The more important question to ask, in your case, is how somebody else obtained your logon credentials.

07-08-2009, 11:58 AM	#3
Peverel Still Easily Confused Posts: 889 Karma: 505319 Join Date: Apr 2009 Location: Hampshire/Berkshire/Surrey - yes I am that big Device: Kindle	Yes I was aware of this. I never keep any money in my PayPal Account and they just call down from my bank account. They do send me an email whenever a transaction occurs so I am aware of exactly what is happening. Also my Bank tracks my account usage and last time I made an out of character paypal transaction (it was smaller than normal @ $1.99) they called me to confirm I had authorised the transaction.

07-08-2009, 12:41 PM	#4
Amalthia Wizard Posts: 1,158 Karma: 32196 Join Date: Jan 2007 Location: Anchorage, AK Device: Sony Reader PRS-505, PRS-650, PRS-T3, Pocketbook HD2	I think it would be nice to have the option that money only comes from paypal. Once I found out they can draw on any associated cards I removed everything and added a low credit limit credit card to my pay pal account so if someone did get my login information it would not hurt too bad.

07-08-2009, 12:47 PM	#5
HistoryWes Teacher/Novelist Posts: 632 Karma: 2274466 Join Date: May 2008 Location: Nevada Device: Nook STR, iPad	I'm like most others here. I don't keep any money in Paypal and expect them to withdraw funds from the bank when needed. I think more people do this that transferring money before making a purchase. The much bigger issue is account security. If someone was able to get your Paypal account information and password, chances are very good that some of your other information could be in danger, especially if you use the same passwords on multiple accounts. Change your passwords and notify any banks that have issued you credit cards you might have used online to issue you new ones, then cancel your old.

07-08-2009, 01:06 PM	#6
toomanybooks Addict Posts: 302 Karma: 1039424 Join Date: Apr 2009 Device: Ipad, Ipod Touch, KIndle Fire	I am a holdout. I refuse to use paypal as they have had too many security breaches in the past. I do not trust them with access to my money. A universal electronic payment scheme is a great idea, but it needs to be implemented in a more secure manner.

07-08-2009, 01:10 PM	#8
toomanybooks Addict Posts: 302 Karma: 1039424 Join Date: Apr 2009 Device: Ipad, Ipod Touch, KIndle Fire	http://free.avg.com/ I have had good results with this free program.

07-08-2009, 01:12 PM	#9
ruth1304 Addict Posts: 394 Karma: 1546 Join Date: Apr 2009 Location: Bristol, UK Device: Waiting for a kindle!	Exactly the same thing happened to me recently. But I did realise that it would take money from my account if I had nothing in my paypal account. Paypal realised that the payment was unusual and put a block on the account. This meant that although I realised what had happened before the money was taken from my account, I couldn't report it as a problem. I did try. Lots It was a complete pain to sort out, as I was away from home for a few days at the time and the withdrawal cleared out my account as well. I haven't cancelled my paypal account, but I have linked it to a credit card to prevent some of the problems I had this time.

07-08-2009, 01:39 PM	#12
DixieGal Hi There! Posts: 7,473 Karma: 2930523 Join Date: Feb 2008 Location: Ft Lauderdale Device: iPad	You guys are scaring me! I use Paypal all the time, and the only time I had a problem was when I bought something off eBay, and the seller disappeared with my money. It was nothing at all, Paypal refunded my money within a few days after I called them, no questions asked. Well, a few questions, such as "What happened?," but otherwise, you get my drift. dwallbaum, are you going to get a refund because of the fraud?

07-08-2009, 01:49 PM	#13
ruth1304 Addict Posts: 394 Karma: 1546 Join Date: Apr 2009 Location: Bristol, UK Device: Waiting for a kindle!	When I finally managed to report the problem, PayPal investigated - which meant they contacted the seller. As soon as they did that the seller refunded my money, and my bank refunded the charges I incurred so I wasn't out of pocket in the end, it was just a bit scary. When paypal know there's a problem they do investigate, and ask the seller to explain the transaction, because the fraud could be associated with the vendor or they could be a second victim of the crime. The transaction was $800, which is significantly more than any other paypal transaction I've ever made and I've only ever paid in dollars to US stores, so it was fairly obvious. Part of the problem was because paypal noticed it was strange and limited my access to the account until they could find out what was going on.

07-08-2009, 01:54 PM	#14
rgeorg Guru Posts: 675 Karma: 3314796 Join Date: Mar 2009 Location: Europe & USA Device: K3/3G(2x), Glo HD, Amazon Voyage	I knew about it. Our bank setup a new account and that is the account we link to PayPal. We xfer money into it when we buy something which triggers an automatic SMS-phone alert that has to be confirmed. Perhaps a bit paranoid....

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