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Changing PayPal attitude about chargeback?
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Changing PayPal attitude about chargeback?

charliecharlie Member, Provider

We received a chargeback (as usual from spammers, etc) issues in PayPal, and this was the first time when PayPal send an answer to us (i mean a real person answered!).

And this answer have a very interesting part:

I can understand that this is frustrating for you, and I want to inform you that VPS and other services is not protected by seller protection when there is opened an unauthorized transaction case, as this is very difficult to proof it is sent.

Comments

  • IgniteServersIgniteServers Member
    edited October 2015

    If it was a server that was sold just provide them with the root password and login and keep the server online, then call them and ask the rep to look into it they should be able to close the case in your favor ASAP, paypal protects companies like us against virtual / intangible goods.

    Also you need to read the paypal policy and you will know that you are protected so you can correct the rep next time you talk to them.

    Edit: Did he purchase from you through secured checkout if so there is no way he can put it as unauthorized if you have the proper security in place on your secured checkout, requiring address and name and checking geographical location + IP address.

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  • real spammers don't chargeback!

    P.S. PayPal are always fussy about virtual services, most disputes you can win but chargebacks i have no luck.

  • someone from paypal needs to join LET.

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  • no seller can win an unauthorized transaction dispute or chargeback

  • @century1stop said:
    no seller can win an unauthorized transaction dispute or chargeback

    That's where you are wrong buddy all you need is the signup IP and or original user information from their paypal in which you would get if your using a secured checkout that requires a shipping address.

    All paypal will do is simple look at the IP that the user is logging into their paypal account with and compare it to the IP which you send them from the users registration if it matched or is anywhere close you will win the case guaranteed or paypal will simple cover the case in both users favor.

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  • @IgniteServers quite true but payment can be done from abroad, rather tricky if the case is based solely on IP

  • @IgniteServers Good luck, the last time I had a chargeback I sent them 7 pages of logs about the user including logins into the software and the associated IPs. They told me a day later that I didn't provide enough proof.

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  • ratherbak3dratherbak3d Member, Provider
    edited October 2015

    We usually track down and refund spammers within the first few days. Would rather just refund and get them as far away as possible to be honest, we don't gamble with chargebacks.

    IT & Hosting Solutions Rotherham - Virtual6 Ltd

  • @ratherbak3d that's right, I'd prefer to refund too and get it over with

  • @tr1cky said:
    IgniteServers Good luck, the last time I had a chargeback I sent them 7 pages of logs about the user including logins into the software and the associated IPs. They told me a day later that I didn't provide enough proof.

    Well I've had encounters where all I provided was the registration IP and the picture of the users account information and have won cases, I only believe I lost 1 unauthorized claim and that was before paypal updated its policy.

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  • jarjar Provider

    @IgniteServers Good luck. That used to be true. Best I've had with the new rules is they've refunded me AND the customer, taking the loss on themselves. I'm not confident that will keep happening.

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  • @Jar said:
    IgniteServers Good luck. That used to be true. Best I've had with the new rules is they've refunded me AND the customer, taking the loss on themselves. I'm not confident that will keep happening.

    True this has happen to me also. I know for sure with in tangible good the case can be won almost instantly for businesses selling virtual servers. As for unauthorized, the person is basically saying he did not make the transaction from his account at all. So if you think about it if paypal looks at his IP that he is logging in repetitiously with, and it matches the IP you give them from the registration on your business site and the name, what should that tell you? " the transaction is not unauthorized you just need to be sure you have your evidence".

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  • ClouviderClouvider Member, Provider

    3D Secure is the keyword here, if we talk about 'It wasn't me!' transactions.

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  • NekkiNekki Moderator

    I'm going to chargeback your mum.

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  • @Nekki said:
    I'm going to chargeback your mum.

    Oh you.

  • NekkiNekki Moderator

    @ATHK said:
    Oh you.

    Imagine if you could chargeback prossies tho, it's the perfect crime.

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  • NocRoomNocRoom Member, Provider

    I haven't lost a case, with paypal your have to use correct wording " This is Virtual Goods, TOS (link) No refund for digital goods. Client Abuse network which is also against our TOS" etc

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  • VirMachVirMach Member, Provider, Top Provider
    edited October 2015

    The best way to win a chargeback is to make sure it doesn't happen. I can tell you that PayPal definitely is the most fair with unauthorized claim - if they see that it has no grounds you will usually win. It's the actual unauthorized claims that they can't do anything about. As for fraudulent chargebacks, meaning the customer owns the card, it was authorized, and they actually received the service but just want their money back: Visa and Mastercard will completely screw you over every time. American Express will actually look at your appeal and you might win. I guess that's why they have higher fees and less customers?

  • thought the new policy covers digital goods now?

  • @century1stop said:
    thought the new policy covers digital goods now?

    Nope, it doesn't, for sellers. It covers protection for buyers, not for sellers.

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  • @tr1cky said:
    Nope, it doesn't, for sellers. It covers protection for buyers, not for sellers.
    that's right, so buyers can claim, isn't it?

  • WebProjectWebProject Member, Provider

    chargebacks case can be won, if you provide customer real signature, the PayPal will pass info and signature to credit card company and they do reverse the chargeback, but PayPal still charge £20/$20 for processing chargebacks case.

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  • @century1stop said:
    thought the new policy covers digital goods now?

    It does for sellers also dude.

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  • jarjar Provider
    edited October 2015

    @IgniteServers said:
    It does for sellers also dude.

    "Transactions without a shipping address aren't eligible for seller protection."

    Taken from an actual transaction page. There is no shipping address because you're not shipping them a physical item. So no, seller protection is not a thing for virtual goods anymore. See:

    image

    Ref: https://www.paypal.com/us/webapps/mpp/security/seller-protection

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  • WilliamWilliam Member, Provider

    Jar said: "Transactions without a shipping address aren't eligible for seller protection."

    This only means you have to use secured checkout where the user provides the shipping address. Won multiple PayPal disputes that way already. CC chargeback is much harder and very unlikely to win though unless you either had a PCS (physical card transaction) or a signature (and/or video recording of customer).

    Can also be circumvented by sending access data only by snail mail, but that obviously takes forever.

    Thanked by 1jar
  • jarjar Provider
    edited October 2015

    William said: This only means you have to use secured checkout where the user provides the shipping address

    I mean that would get around the message, but I'd still have to prove that I shipped something in an "item not received" dispute right?

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  • Jar said: I mean that would get around the message, but I'd still have to prove that I shipped something in an "item not received" dispute right?

    So sell beer bottle caps with free VPS ;)

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  • jarjar Provider

    @singsing said:
    So sell beer bottle caps with free VPS ;)

    Empty everclear bottles, I have enough of those!

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  • WilliamWilliam Member, Provider
    edited October 2015

    Jar said: I mean that would get around the message, but I'd still have to prove that I shipped something in an "item not received" dispute right?

    Yea.... technically. As with any large corp, especially in financial, the PP ToS are very vague to give them some more options just in case.

    Depends on rep, really - I got around that sometimes by simply sending them log of the clients email server accepting the setup email, the content of the setup email as well as (if possible) output of "last" on the server to show the users login IP (which might match PayPal IP(s) or at least his range or ISP). Sometimes they did not want anything at all and just closed the dispute.

    It is also in general nice to get the shipping address from/via PP to verify it against the account data.

    Thanked by 1jar
  • singsingsingsing Member
    edited October 2015

    What will be interesting to see is how PayPal will react to competitive pressure from crypto currencies.

    Given that PayPal can be reversed so easily by scammers, why should a merchant even accept it if they can accept just Bitcoin instead?

    Or, a merchant can provide a "Bitcoin discount" -- i.e., essentially a premium assessed to against buyers using PayPal to cover the additional risk to the merchant.

    To compete, PayPal (and CC companies) might have to start reviewing claims more seriously and with lower fees ...

  • @singsing said:
    What will be interesting to see is how PayPal will react to competitive pressure from crypto currencies.

    Given that PayPal can be reversed so easily by scammers, why should a merchant even accept it if they can accept just Bitcoin instead?

    Or, a merchant can provide a "Bitcoin discount" -- i.e., essentially a premium assessed to against buyers using PayPal to cover the additional risk to the merchant.

    To compete, PayPal (and CC companies) might have to start reviewing claims more seriously and with lower fees ...

    I doubt it many users simple will use paypal because of the name.

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  • jhjh Member

    Write 1-2 paragraphs to Paypal stamping "not covered under dispute policy... intanglible goods" 3-4 times throughout it. It's like content writing for SEO.

  • IgniteServers said: I doubt it many users simple will use paypal because of the name.

    Hey, things change. If it were that simple, Blockbuster Video would still be in business.

  • zevuszevus Member
    edited November 2015

    I'll preface this by saying I've done some three chargebacks on Paypal since registered in 2000...

    Anyway, I filed chargeback over some crap service by hosting company, Paypal said it wasn't covered, apologized for it, and essentially offered me the amt in question as 'complimentary' refund. I refused that and just went to bank and filed unauthorized transaction instead (paypal balance was $0, and using bank as backup source). This way the crap hosting company ended up having to pay Paypal, instead of me just getting free money from Paypal.

    How is it possible to win these cases? If Paypal denies it, you always have second option, unless funding is directly from Paypal balance

    ed: yes, i did have to re-verify bank with the whole two deposits thing

  • singsingsingsing Member
    edited November 2015

    zevus said: Anyway, I filed chargeback over some crap service by hosting company

    zevus said: I refused that and just went to bank and filed unauthorized transaction instead

    You realize, of course, that that's a form of fraud? You're lying to the bank about the transaction having been unauthorized when it wasn't.

    Why anyone would commit fraud just to get back at a hosting company for allegedly crap service is beyond me.

  • ClouviderClouvider Member, Provider
    edited November 2015

    Form of fraud they you can be prosecuted for. Good job admiting on a public forum ;)

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  • How minimize risk of charge-backs with virtual foods? Are there any recommendations?

    I was think about something like this:

    create page, where people must accept rules and ToS, where they will see "hey buddy, there are no chargebacks at all, if you accept it, you can do transaction, if not, we wont accept your money."
    

    Is it stupid method? How about proofs of transactions & goods?

    All of my friends telling to me: "if you have paypal alternative, run away from it", is that true? Because as many people explain to me, i understand next things:

    • Seller not really protected
    • People who receiving donations not protected

    How to avoid the shit like this?

    This problem start to be a very popular, and maybe will shoot in next few month like shitty booters and stressers.

    Any recommendations to minimize risks with paypal?

  • If your running a legit business you should be able to handle this with no problem, simple call paypal explain your business and give them the things they require, you cant go wrong with LEGIT information.

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  • I usually just copy-paste the setup info email to PayPal and remove the password from it. This way, PayPal always decided and closed disputes in our favor.

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  • zevuszevus Member
    edited November 2015

    @singsing said:
    Why anyone would commit fraud just to get back at a hosting company for allegedly crap service is beyond me.

    rage issues

    ed: judging from topic at hand and responses, all chargebacks being discussed here are fraudulent, so it's actually a strange question of you to ask why anyone would do this

  • zevuszevus Member
    edited November 2015

    Oh, I haven't had a repeat occasion... but I did learn that in the future for all such problems, to file it as 'unauthorized transaction', rather than the 'services not as described' or whatever it was I used before.

    So the lesson for today is to fight fraud with fraud, if you want money back from Paypal from fraudulent service providers. Small claims isn't an option in most cases (usually has to take place at business local jurisdiction)

  • zevus said: So the lesson for today is to fight fraud with fraud, if you want money back from Paypal from fraudulent service providers.

    I don't believe fighting X with X is always morally justified, I'm sure there are lengthy treatises available on this that you can look up.

    Also, "crap service" is not always fraudulent.

    Let me guess, your beef is you bought a VPS and you landed on an oversold node that wouldn't run your required software smoothly.

    That sucks, but it's not fraud unless you were promised a certain level of performance that was not met. Did the seller guarantee specific cpu, network and disk performance (i.e., an actual number of IOPS for disk, or at least a sharing ratio for all these resources)? I'm guessing not.

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  • @WebProject said:
    chargebacks case can be won, if you provide customer real signature, the PayPal will pass info and signature to credit card company and they do reverse the chargeback, but PayPal still charge £20/$20 for processing chargebacks case.

    This is the first I heard of a $20 fee imposed on the merchant. Ouch.

  • zevuszevus Member
    edited November 2015

    @singsing said:
    That sucks, but it's not fraud unless you were promised a certain level of performance that was not met. Did the seller guarantee specific cpu, network and disk performance (i.e., an actual number of IOPS for disk, or at least a sharing ratio for all these resources)? I'm guessing not.

    ToS stated that customer would be able to set rDNS, this wasn't the case & support was unresponsive for ~5 days (*I guess I should add that not only were they not responsive for 5 days, that the rDNS issue still wasn't resolved even after that, was ~2 weeks in when I asked for a refund, was denied, then closed ticket & initiated the (failed) chargeback, so then proceeded to bank)

    it was a dedicated server, also.

  • ClouviderClouvider Member, Provider

    @zevus said:
    ToS stated that customer would be able to set rDNS, this wasn't the case & support was unresponsive for ~5 days

    Still you have committed fraud by claiming 'unauthorized transaction'

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  • zevus said: ToS stated that customer would be able to set rDNS, this wasn't the case & support was unresponsive for ~5 days (*I guess I should add that not only were they not responsive for 5 days, that the rDNS issue still wasn't resolved even after that, was ~2 weeks in when I asked for a refund, was denied, then closed ticket & initiated the (failed) chargeback, so then proceeded to bank)

    Well, congrats, you have persuaded me that you were indeed scammed there.

  • jarjar Provider

    @Clouvider said:
    Still you have committed fraud by claiming 'unauthorized transaction'

    Yep. Product/service not delivered or however they word it might be fine. Unauthorized transaction report on an authorized transaction is fraud.

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  • So i have one question, I sold my account and after 2 days I got dispute from Buyer, but
    in his message he said that he bought account got account and after 2 days he realized that account was reclaimed. Who can win this? I mean if buyer agreed that he got acc and used it can he even to put dispute.

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