Paypal issue beware.

Very frustrating story, and a good reminder to all those here who so happily state that THEY have never had a problem with PayPal...not yet.
Did you at least insure it for value so that you could be reimbursed?

Yes, But since the guy accepted it and it didn't get reported when it was dropped off they refused the claim. 

I don't know if the damaged happened in shipping since he didn't inspect it and report it or when he received it.  

In order to operate online business successfully gotta be able to USE paypal instead of paypal USING you. You need to be salty and grab CASH as fast as you can after sale, because paypal is not your pal -- it’s your worst enemy you want to keep close so you can control it and USE it. In order to sell $500+ item, you need to make sure your paypal account will be capable to give you cash right next minute without holding. One account busted with ridiculous problem like that -- another at least few should be active while you fight for first one. and so on and so fourth. Need at least several accounts to operate safely. They wanna refund? Fine! -- not my problem cuz I need cash and I will get it and if necessary, will sacrifice account with no risk of affect on credit history. NEVER MERRY active bank accounts to paypal meaning ones you get your wages. Prepaid accounts is BEST to use with paypal, because they can’t have negative balance. Once again want to refund $3000 or $3M? Fine! I got cash see ya!
Your current action will be is to use municipal court to summon bastards. Usually they don't show up or present rookie representative that knows nothing of a matter and you will get default judgement towards your benefit.

OP,
You should have the buyer send you pictures of the damage so that you can make a legitimate claim. He should also make a statement to them in your support. Sounds like he's just looking out for himself so far.

Did you contact the buyer and verify that it is being sent back to you?  That would be my first step.

actually, the inspection is kinda/sorta supposed to take place at the delivery moment. If the buyer claimed it was damaged in shipping and did not do so when UPS delivered it, then their claim is defacto spurious.

That is one tack to try, at the very least.

@czarivey ,
I don't understand what you are saying. Do you have multiple PPal accounts? How does that make it 'safer'?
B

This is why I only accept a gold bar now for payment and then it must clear my bank first before shipping!! (new rules after getting burned on a sale last year)


Matt M

B,
 I stated clearly for using live reserve account while your primary account is under “fire”
There are LOTS of details on how to get around PayPal scams and thefts, but this insider information is tooo pricey;)

Sorry to read of this. That's why I insist on a check, and then ship AFTER it clears my account. I just won't use Paypal.

You are not without hope...we have a legal system for times like these and remedies exist for you. Pay a relevant attorney for an hour of their time if you need to, it’ll be worth it. Suggest to the guy who is screwing you that you are in the process of seeking legal remedies, and it is in his best interest to work with you rather than go to court. If that doesn’t work then let the legal system churn its gears.

@gdnrbob, I think what czarivey is  saying is have one designated bank account for Inet/paypal transactions and only keep slightly more than what's needed to do the deal in that account. Use other bank accounts for regular business that are not linked to Paypal or the Inet.

Tom

I have only my CC to buy stuff via PayPal.
If I was selling and getting PayPal payments, I would open a small savings account at a Savings and Loan.
Usually free, and any money moved thee from a sale to it take out immediately.
(leaving like $5  or whatever is that S&L minimum.)
This keeps PayPal from having access to you 'real' checking account.

If they cannot just grab your money, they might be more willing to discuss the problem?

@tomcarr, thanks for the explanation. Czarivey's phrasing was a bit eccentric.
B

I've hated PayPal for years....   so easy for the buyer to cry foul.... no thanks, I'll buy and sell locally with cash.  Takes a little longer and maybe you don't get quite as much, but it saves the hassle of shipping and virtual currency.     The last time I sold a big ticket item they held my funds hostage for over three weeks even after I sent proof of delivery and positive feedback from buyer.    In addition they would not let me take all of the money out so I had to send it to my wife who had a verified account as a gift to get it quickly.   Some gift that was.....$2300 that I'll never see again....Thanks PayPal

Paypal is pure garbage have never or will i ever use it if you do good luck!!

I believe that if we bundle up problems and together hit PayPal, we can gather GOOD hit against PayPal. 
One thing I learned about PayPal is you can either bend it over or it will bend you over and there’s nothing in between. The more folks chip in — the better chance of delivering a good blow.
Gather, register, find counselor and go — get your dough back with possible vate!

I'm with @czarivey.  PayPal is not your pal.  For years I used eBay and PayPal to buy and sell, but as you found out @programmergeek,  your words generally fall on deaf ears.  Suffice it to say, I avoid using PP but for merchants/sellers, unfortunately its a necessary evil - even here on Audiogon.

Having said that, if a vendor sends me an invoice from PayPal allowing me to pay using a credit card, I will complete that transaction.   Using a credit card , you can pursue a Dispute/Claim with PayPal, or you can contact your credit card company and file a chargeback.  I'd opt for contacting my credit card issuer.

Unless PayPal has closed my account due to inactivity, I still have an account with them but I've removed all CC and bank information from my PayPal account profile.

You can file a claim with your credit card company to see if that will help.  Next time you ship something have the buyer give you an account at UPS or FedEx so that the claim is submitted on their end.

Been using pay pal for years and have never heard of refunding with out the return of the item. I would contact an attorney and also talk to a reporter with the local news channel. If you can get them involved the public attention may help. When you use Pay Pal you have to back your account with a credit card. You can get a Bankcard just for Pay Pal with a $300 to $500 limit and make the bank contact you over those amounts. As soon as you are paid remove the cash from Pay Pal. Do not use the PP account till you have things straighten out. You can also just use the account for receiving payments and after you give them the Card number cancel the Card. You can transfer to a saving account or have them write a check. The check does take a week. I would also contact the people at AudioGon. They have always been very helpful every time I have contacted them. Maybe they can apply some leverage.
It is very hard to make a damage claim. The shipping companies always say it was not packaged correctly. Been thru that many many times. If the guy signed for the package he is saying the package arrived in good condition. You have very little recourse.
Just curious was this a complete sale in the US? Not overseas?

I call they said because he used some sort of mandated government payment they do not require any evidence that it was shipped back.

What type of payment is this?

By chance was the buyer Ben Carson? 

Same exact thing happened to me on US Audiomart with a Krell CD player. Got jacked for 2500 bucks. Fortunately the guy that scammed me lived a couple hours away and was shocked as hell when two of his local law enforcement officers knocked on his door at 830 at night, 

I got my Krell back real quick.

I've had an issue like this when college kid was ordering stuff using the school email/username and ISP, and paying for it with bad checks.  it was an Ebay transaction.  I didn't know it at first, had the antique radio packed up, emailed him to verify address.  He emailed back don't bother I already stopped payment on check hahaha.  I emailed back well I didn't ship the radio yet hahaha.  I traced the ISP of the email, it was a college, called them, the dean took his side.  So then I called campus security, and the local town police where the school is located.  Then things changed quick.  The dean called me back, apologizing, and they shut off the kid's net service.  Turns out he dropped out of college, was still using their free net service to scam on Ebay.  he had a long history of buying things and paying with bad checks.  so I'd advise you, call the police for that city and tell them what the guy did, because he basically ripped off your stereo.  they'll knock on his door and he'll get a nice surprise when they threaten to arrest him unless he returns it.  also call his ISP and tell them he's using his net service for theft, they'll shut him off.

I remember years ago selling a video processor to a “gentleman” up in Canada. Of course the usps took a 10 days longer than their eta. Well, the buyer had filed a claim and since it hadn’t hit yet and their tracking system was and still is horrible they refunded him the money. Of course a few days later it shows up at his house. PayPal in an attempt to communicate with him discovered he closed his account and was no longer active with them. Of course he did. It was 2K! I still think to this day he had planned this all along. He even requested economy international shipping. People will always find a way to cheat. And PayPal makes it easy for them...

I had the exact thing happen to me 6 years ago, Paypal refunded his money ($1600).  To add insult to injury, UPS refused to cover the claim, even though the receipt was marked "well packed" by the agent.  I feel for you man.

Those who say he accepted it so you can’t file a damage claim are incorrect. I recently received some speakers that were not packed properly and got dinged up bouncing around in the box with no damage to the box. I picked them up at UPS and discovered the damage when I got home. The shipper filed a claim and UPS then required an inspection. They will either ask for pictures, come pick up the item to take it back for inspection, or you can request they come to you. If the buyer can’t produce the item for inspection or prove they shipped it back I would say it is on him. I’m not sure how you deal with PayPal though.

You may have a case for wire fraud involving interstate commerce. I would check with a lawyer. Call the FBI. They guy certainly broke some state or federal law if he cheated you out of $1500.

BTW UPS did pay my claim based on pictures I sent them. The trick is unless you have the original package, they will claim improperly packed unless you pay the UPS store to pack it, which I did. Then they can’t use that excuse and have to pay. It costs a little more but on an expensive item well worth it. They also didn't ask for the speakers back. They were dinged on the edges but I patched them up and you can't see any damage unless you go up close and look for it. 

In nearly 700 transactions buying and selling, I have been "robbed" 5 times. Either buyer claims item wasn't as described and sent back something different or did even communicate. Each time ebay / paypal ignored the evidence and I was out the money and they billed me for the sale. Most of the time these folks turned out to be apartment renters and reshipping to another country. When I contacted local PDs they were of no practical help. Just not a priority for under resource for their case levels. Being right and pursuing costs the victim more in legal, travel, time and aggravation. Crooks know it. And when you do as I did once, what will you do / achieve? You are out more money or if you confront them in person, someone goes to jail or hospital and it could be you. Not worth all that. In business accounting we had "bad debit" and "uncollected" factored. It's NOT right at all but it is gonna happen because there is more and more opportunity and fewer and fewer people are honest and ethical. There was the Ice Age, the stone age, the age of fire, the bronze age, the industrial age, the information age and increasingly so over the past several decades we have the age of the liar and cheat. I am much slower to upgrade audio gear via online platforms such as ebay and agon and audio marts because reselling on line once safe and pleasant is now dreaded and even to be avoided. Sorry for these developments and folks' losses. Sucks to be a victim but sucks more to dwell and not move on to more positive. Life is short. We can collectively make a difference when we realize and act knowing PayPal and the like will only respond to the economic imperative of a decline in revenues due to a decline in use and advertising. Adjust in ways that work best for your well-being and enjoy the music , your family and friends. Offered with the utmost respect and kind regards. Namaste  

@programmergeek , sorry for your problems but appreciate the thread, which is full of good information and reminders.
I would add two things after reading through the issues posters have described.
First, you cannot overestimate the value of packing something well and going the extra mile to double box, ship on a pallet (when necessary), and generally over-package everything.
Second, there is value in the Audiogon community and feedback system. It is not perfect, but it is something. Whether you are a buyer or seller, seeing the length of time your trading partner has been around here and reading testimonials written about that person by other folks on this site, provides at least a baseline as to whether you want to trade with them or not. Being able to set parameters for those you trade with is also helpful. For example, when buying or selling expensive and/or heavy hard-to-pack and ship items, there is value in dealing with folks who have done this before and are known for taking extra care in packing, shipping through a suitable carrier, insuring, and following-up. This stuff will not prevent occasional problems but it is something folks can look at to safeguard themselves.

So here is what I have learned from this discussion to do business on PayPal. 

Scam
Buyer received item but says item not as expected. 
Files a claim with PP and can  get money back immediately if it is still in your account. 
They do not have to prove "not as expected". 
They do not have to send the item back to keep the refund. 

Questions :
What if they send back the wrong item
What if they send back an empty box. 

Now you have a worthless  counter claim.... 

Here is what I will be doing from now on. 
Remove all sources of payment from PP other than a prepaid card. 
Fund  prepaid only as needed for purchases. 
Remove all money from PP immediately up receiving. 

Should this protect me from the scammers? 

PayPal is a value tool

Many years ago I sold a Mac preamp to some guy in Italy.He filed a complaint with Paypal,that he hadn't received it.Paypal never bothered to inform me that a complaint had been filed.Anyway,I log into my Paypal account and find that $714 have been given back to the buyer.At that time Paypal had a money market fund that paid the highest rate in the country,so I left money at Paypal.Later,I found out that the Italian postal service is a mess and many sellers won't ship there.A few weeks later the buyer emails me that he received the preamp and the front glass is broken.I figure that being in the Italian post office for 5 weeks,they kicked it around and broke the glass.So,now I decide to file a damage claim with USPS.USPS says the buyer has already filed a claim and I can't.I inform Paypal and they tell me they sent me 4 emails during the original complaint period and I never responded.I know they never sent any emails but contacting Yahoo mail,I'm told that i can't prove that Paypal  never sent the emails.So,I give up and the buyer gets the preamp ,likely damage claim money and I'm out the preamp and shipping expense..Unless you are selling on Ebay and almost forced to accept Paypal,I would avoid Paypal.At least,if you use,have any money received transferred to a linked bank account asap after receiving any payments.

Suggestions for having PP tied to a basic checking/banking acct (min "$100" balance) not tied to any of ones major/personal funds is a very good idea.  However, in the OP's scenario, if PP tries to take $1k from your (basic) acct, wouldn't you incur overdraft fees or other headaches?

Recently, I just went through this WHOLE THING with eBay & PayPal and can describe the process. I'll try to explain this briefly...  I do not carry a PayPal balance, and have been using my account since the x.com days, so I've seen a few scams.  I sold a TV speaker on eBay advertised as NEW.  The buyer made a claim saying it was missing a part.  I fought the dispute and won.  Buyer then files a dispute with PayPal by issuing a charge back.  Note: the person is the problem, not PayPal.  Now in my case buyer paid with a credit card, so it may be different if the buyer used a bank account or PayPal balance.  Now PayPal immediately withdrew the transaction amount (by law as OP stated) + a pesky $100 charge back fee, which I fought and got waived.  The buyer does not have to return the item.  The buyer does not have to prove anything.  The seller can only give their side of the case to PayPal.  PayPal will fight vigilantly on your behalf.  However, there is a mandatory 75 day waiting period.  Since I do not typically carry a PayPal balance, after 21 days I still had a negative balance and started getting nasty emails.  After another week or so, I could no longer call PayPal to discuss and would be immediately be transferred to collections.  After 37 days, I think it would appear on my credit report so I paid the negative balance.  At this point, all you can do is wait.  9 out of 10 cases are won by the buyer, mainly because the seller wasn't prepared to fight with proper documentation.  If you lose, your best recourse is small claims court.  In my case, I was fortunate and won and winning the eBay dispute certainly helped.  It's a risk to sell in the sense that credit card companies view you as a store that should always accept returns for whatever reason, but that is not true as most people do not operate as such.  Understand that PayPal is not a bank, they are merely a payment processor, so if you sell a lot, get seller protection from them.

Pay Pal is the worst.  
They are a 3rd party vendor who Leaches off actual processor systems.Their entire business model is to contract with the actual processors and throw their service fees on top and pass that all off on their customers.
They market themselves as being a safe but most of all fast. Every one likes fast until there is a problem. When there is a problem they pass that off their customers as well as long as they can get away with it.  To actually fix a problem takes time, resources and money which they do not want to deal with. 
To fight with them you have to be prepared to get Nasty. You need to demonstrate that you are not going away and that if need be you will bring an army of resources to conduct your own investigation into their business practices.
I had a similar problem with them several years ago and they were giving me a the whole run around as to their investigation policies and why they were justified in sticking me with the loss. I had to threaten to sue them, not in small claims, but to get the US attorneys office to conduct an investigation since this would constitute Mail and Wire Fraud which is a federal case. I also pointed out that if they were doing this to me they were probably doing this to thousands of accounts a day which probably translates to Hundreds of millions a year, which would most likely prompt a class action suit  -
They reimbursed me the Next Day. I never used them again. 

I have stopped using PayPal as a method of receiving funds from sales.  I received payment by a "PayPal cheque" in my last transaction and it took PayPal 10 days to clear.  I could have got a Cert. Cheque or Bank Draft through normal mail twice as fast.  PayPal had the use of those funds during that period and they charged me 3%.  Ridiculous.

I now use bank draft or e-transfer.

lot of good info .  Quite startling to consider that PP can refund $ to buyer  without setting up a process whereby seller will get the item back.  I would of not believed that could happen until I read it here.   I have had reasonably good luck using PP over the years selling here primarily.   They did not back me re/a pair of factory boxed speakers that a buyer had claimed were damaged in shipment.    UPS was contacted after delivery and denied claim despite excellent factory boxing that even included a factory custom made particle board cover for the drivers in addition to the complete envelopment of the speakers with 3 inch styrofoam slabs .  Re/this damage-- I had speculated that drivers were damaged because of g force of the boxes being slammed with the driver side of the speakers  taking the full force thus distending cones out.  This being the result of a disgruntled driver tired of attempting delivery and not finding buyer there..  I find  a critical piece of the process is that a buyer HAS to follow a protocol that maximizes the potential for a successful delivery.     Not being there for 3 attempts is really unacceptable.     Although then this came up in my investigation .    Statements from both Decware speaker maker and the  speaker driver maker indicated that the driver damage was due to DC current from a faulty amp.  PP ignored  statements from the vendors as to the potential of buyer caused damage.  I saw all the pics of boxes,  etc with no visible damage to boxes or speakers other than driver damage.   UPS would only refund for shipping.  PP indicated that I needed to compensate buyer for repair.    At any rate--  I Have had best service with FEDEX over the last 16 years  and do not recommend UPS .   And now will consider what I can do to limit or remove my affiliation with PP.   

I can understand frustrations on the part of sellers regarding PayPal seemingly being a bit deaf when it comes to unscrupulous buyers, but on the flipside when I'm buying something I prefer PayPal because I know they will protect me from an unscrupulous seller.  Allowing payment via PayPal opens the doors for many more buyers to consider your item. 

I would never purchase something where a seller mandated I pay via cashier's check, money order, bank draft, or some other method where I didn't have recourse in case the item arrived broken or not as described (though I am fine paying in cash for in-person transactions where I can inspect and test the product before payment changes hands).

I have also noticed a number of sellers here who do accept PayPal stipulating that the buyer is responsible for covering the PayPal fees.  That's explicitly against the PayPal terms of service.  Buyers are not allowed to impose surcharges for items that don't apply to all other forms of payment.  

Oh Lord, don't even get started on the PayPal fees being charged by sellers to buyers.
I started a thread on that couple years ago and you would have thought I was suggesting members sacrifice their first born when I stated it was against PayPal TOS!
It had to be closed due to the vitriol being poured forth, apparently members think quite strongly on their "right" to ask the buyer to pay their fees.

I had same exact thing happen with a $1500 amp. Pascal is a scammers paradise. Seller has absolutely zero protection. They side with buyer every single time. Pascal is truly a horrible service.

Basicaly PayPal works very much Like a gentleman’s agreement. As long as both sides play nice it is convenient at best.
However PayPal have a long sad history of siding with the buyer even when presented with overwhelming amounts of contradictory evidence to the scam buyers nonsense.
Been there, fought them, got a credit ding for my troubles but at least I kept my money( twas in the days before they had rights to just raid your bank account for any perceived deficit).
Unfortunately a lot of buyers prefer PayPal for the protection they see it gives them.
And as gentlemen become less prevalent in the world, the worse it will get for sellers.

trumpisgreat16 is correct stating that buyers pay PP fees is against PP policy and any charge card for that matter. It is perfectly legal to add 5% to the selling price and offer a 5% discount if paying with cash, check, etc. The problem is what the item is worth is usually all people will pay.  PP is a very good tool for a buyer and seller to pay each other. Using the feed back on Ebay and AGon also gives you an idea of the credibility of both parties. Yes, the 3% charge on big ticket items is a rip off.
I use PP for all purchases because the packing coming from some sellers on Ebay and AGon is pretty bad. It is the only recourse I have for bad packing. I also think the seller should pay the return shipping, when the packing is clearly at fault.
It is bad that the seller pays the fees and usually get the short end of the stick. When Ebay started, you sent money orders and cash to the seller before they would ship an item.  I have over 5000 sales on Ebay over 20+ years and for the most part hate the outrageous fees they charge, but they have done much for the resale market of almost everything. Ebay has sided with me on a couple problems I have had with buyers, but for the most part they side with the buyer. I can also say, PP email me to not ship a sold $400 item sold on Ebay, because the card was stolen. Luckily I had not shipped the item. I would have been out $400 for sure.
 

We all seemed to have had some sort of problem's with PayPal,  my question is,  what reputable service is out there that similar to PayPal?,  I'm surprised that someone like Google,  Facebook,  Yahoo,  ect.. does not start a service, I wouldn't believe that there is some kind of copy rights, infringement laws, saying that a company of this kind cannot be established, can you imagine the money a company can make taking all the business from PayPal?, I would buy shares from a company like this a.s.a.p.  lol!

Pay Pal is a third party "Service provider". They are based out of Singapore which means that they do not have to comply with US banking regulations.The main Processors are, JP Morgan, Citibank, Shift 4, First Data to name a few. I do not understand why in today's market especially with mobile banking more vendors don't go direct to the source. Why insist on paying a third party like Pay Pal to contact the actual processor rather than you doing it for yourself for free. Of course the actual processors always charge their own fees, but Pay Pal charges fees on top of those fees in order to make their money. They also impose several terms like they have the right to withhold currency for 30 days for security reasons  - when in reality it's  for them to make money on interests. 

Then of course there is always, just writing a check, waiting on snail mail, waiting for the check to clear... its slower, but still works.  

Excellent points - ggcIn today's instant gratification society, most sellers/vendors are too lazy or inpatient to await for cash, check or money order. As more companies enter a partnership w/ Paypal, there is very little wiggle room for other forms of payment options.