Paypal risk to seller?
/forum/topic/1098535/0

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hondageek
Registered: Aug 16, 2004
Total Posts: 888
Country: United States

I have a camera body for sale on Craigslist. If I tell a buyer that I won't ship it until their funds clear into my PP account and I then withdraw the funds into my bank account, is there any way I can get ripped off? I have heard that I can be held liable for the funds if the buyer uses some form of fraudulent payment. Paypal can somehow come after me for the money. Does anyone have any insight on this?



fastcarsspeed
Registered: Dec 01, 2009
Total Posts: 282
Country: United States

You need to be smart and protect yourself. When they send you payment they need to be verified from paypal. This will protect you in the sale. If they are doing an echeck by all means wait until it clears your paypal account completely before shipping the item. Paypal will ensure it if you go the regular route. Don't try to do the gift option or anything like that. If they are not confirmed I don't accept the payment. GLWS.



monochrome
Registered: Aug 24, 2007
Total Posts: 3024
Country: United States

Do yourself a favor, stay away from taking paypal with anyone from craigslist. Sell it local and then only do it for cash in a very public place.



hondageek
Registered: Aug 16, 2004
Total Posts: 888
Country: United States

I understand most of the risk. My main question is if I have already withdrawn the funds from my PP account and actually have the cash in my bank account, is there any risk of PP trying to hold me liable?



keithdunlop
Registered: Feb 11, 2009
Total Posts: 635
Country: United States

1. You're far better off selling your gear on the FM buy and sell forum.

2. I've been doing business through PayPal for years and have never had a problem. Just be smart about your transaction. Make sure you get detailed buyer info including full name, PayPal verified address, and phone number. Call the buyer to verify info. Don't ship anything until the payment clears. You want to make sure that your buyer is verified and that you use a trackable shipping method that requires signature. This means FedEx or UPS (not USPS).

3. Sell your camera on the FM buy and sell forum.



Jabberwockt
Registered: Aug 22, 2011
Total Posts: 557
Country: United States

No, you arent safe.

Paypal can reverse the credit to your bank account and claw the money back. Most Paypal requests on Craigslist are scams.



keithdunlop
Registered: Feb 11, 2009
Total Posts: 635
Country: United States

hondageek wrote:
I understand most of the risk. My main question is if I have already withdrawn the funds from my PP account and actually have the cash in my bank account, is there any risk of PP trying to hold me liable?


In short, yes, there can always be a potential problem. These sort of transactions are never completely without some risk. That's just the world we now live in.

Once PayPal clears the payment you're usually fine. The problem that tends to pop up is that the buyer claims non-receipt of the item and starts a claim through PayPal. PP will then place a hold on funds until you resolve the claim; this can create a negative PP balance. If you have a linked bank account, I think they can use those funds to cover your PP overdraft.



hondageek
Registered: Aug 16, 2004
Total Posts: 888
Country: United States

I find it hard to believe that PP can withdraw funds from my personal bank account. Can you provide first hand knowledge of this?



miloz
Registered: Jun 23, 2010
Total Posts: 263
Country: United States

I've heard that repeatedly, but looking at their current user agreement it appears that if you have a negative balance from a chargeback/etc., they will take it to collections and possibly a lawsuit.



Jan Brittenson
Registered: Mar 13, 2002
Total Posts: 2206
Country: United States

A common scam is to buy something and then make a fraudulent claim it was never received and a chargeback. They will generally do it around the 1st of a month under the assumption that you have coverage for your mortgage but the check hasn't been processed yet. The typical warning sign is an insistence on shipping with USPS.

If you don't have sufficient balance in your bank account, then the chargeback will fail. I'd suggest having two completely separate bank accounts - one for paypal, then transfer funds out of the paypal-attached one to the other. Paypal can threaten this or that, but at that point you have a legal right to due process, can file suit, obtain an injunction, etc. Once they've taken your money in a chargeback the burden of proof is now on you to get it back.

Only ever ship with a service like Fedex that offers online signature verification. Paypal will try a chargeback and fail, investigate and discover you're in compliance with their rules, and bounce it back to the buyer's CCC, at which point the buyer will typically suddenly discover they actually did receive the item. That's been the time for me each time someone's tried the scam on me.

Shipping USPS is to ask getting ripped off. Never do it except for truly trivial stuff.



jefferies1
Registered: Jul 03, 2008
Total Posts: 2606
Country: United States

If you remove funds from your paypal account and later they find you owe back the money they will take legal action against you to collect. Does not matter if funds are in your paypal account or not.

If you follow the guidelines and ship with a signature required and only to a verfied address after you receive a note from paypal saying the funds have cleared and you are safe to ship it should me a good transaction.

Not sure why you would use it for a local transaction, that sounds like a scam.



Betacamman
Registered: Jun 13, 2011
Total Posts: 368
Country: United States

The point of Craigslist really is local sales. I'd never ship anything I put on CL to someone. And the FM board really does work well



miloz
Registered: Jun 23, 2010
Total Posts: 263
Country: United States

If you follow the guidelines and ship with a signature required and only to a verfied address after you receive a note from paypal saying the funds have cleared and you are safe to ship it should me a good transaction.
All it takes is for the person to claim the item is shattered, or that it was an empty box or any number of other claims to (potentially) screw the seller.



monochrome
Registered: Aug 24, 2007
Total Posts: 3024
Country: United States

miloz wrote:
If you follow the guidelines and ship with a signature required and only to a verfied address after you receive a note from paypal saying the funds have cleared and you are safe to ship it should me a good transaction.
All it takes is for the person to claim the item is shattered, or that it was an empty box or any number of other claims to (potentially) screw the seller.


Claims such as that would have to be verified first and if sent via USPS. Sent insured would cover that, also if buyer claims such and it didn't happen, that's mail fraud a Federal Offense.



mdude85
Registered: Apr 12, 2004
Total Posts: 4398
Country: United States

hondageek wrote:
I understand most of the risk. My main question is if I have already withdrawn the funds from my PP account and actually have the cash in my bank account, is there any risk of PP trying to hold me liable?


They could, if for instance the seller claims the item was not received. But then it would go into mediation. If you provided a confirmation that the item was delivered/signed for then you'd probably win there. Buying insurance would protect against a claim that the item was broken upon arrival.

Pretty rare that this would happen if you're dealing with someone that seems like a real buyer and not a scammer.

I do not ship for craigslist transactions, only Ebay transactions. Unless you are in a small town, I'm sure you can find another buyer who can meet you locally.



JBPhotog
Registered: Oct 10, 2007
Total Posts: 566
Country: Canada

Just like a money order, your bank may clear it and you think all is good. But it can take weeks to actually clear the buyers account and if the funds are not there you will get a charge back.

As someone has already posted, make sure you and the buyer are Verified before undertaking any transaction. Call PayPal and get them to show you the page that states buyer/seller protection, you have to ship the item within a certain period of time and it must be as described. So full disclosure on your part is the best approach.



mrmoses
Registered: Mar 29, 2012
Total Posts: 3
Country: United States

I have been buying and selling used gear on ebay for many years and there is a measurable risk to you.

If they use a credit card to fund their purchase through PayPal they could later on (within 90 days I believe) file a chargeback with their credit card claiming they never received it or some other nonsense.

According to PayPal rules it is then on you as the seller to prove otherwise.

And that is a hassle you don't want to get into, as PayPal doesn't really care if you win or lose. As long as they (PayPal) aren't caught holding the bag.

In about a thousand transactions I have had this happen twice.

Once I won. Another time they did.

So for sure there is a risk.

If you're talking over a $1,000 I would seriously think twice.

Just my two cents.

Josh



gheller
Registered: Apr 30, 2002
Total Posts: 5896
Country: United States

hondageek wrote:
I find it hard to believe that PP can withdraw funds from my personal bank account. Can you provide first hand knowledge of this?



believe it

greg



marti.g3
Registered: Oct 04, 2011
Total Posts: 2034
Country: United States

hondageek wrote:
I find it hard to believe that PP can withdraw funds from my personal bank account. Can you provide first hand knowledge of this?


Read the user agreement you agreed to when you signed up to use PP. It's all there in fine print.



Chris Langer
Registered: Sep 04, 2006
Total Posts: 2388
Country: United States

Do not sell anything on Craigslist through Paypal. I did a local transaction and met with the guy and agreed to Paypal. He came back a week later and pulled the funds out from me, Paypal sided with him. I was furious and decided this was my last transaction. If you Google Paypal horror or Paypal collections, you can see how much Paypal screws sellers everyday.

I have the funds in my bank account but now I have a negative balance. I got hit hard and now Paypal is sending the dogs after me. I get automated calls every morning insisting I resolve my negative balance. I closed my bank account and canceled all of my credit cards associated with my account. They cannot take anything from me.

Probably give it another couple of months and then I will have to deal with collectors. I am currently pursuing this fraud in court and hope to have something resolved to pay off Paypal. The guy who stole from me wasn't very smart as I have a signed contract, address, and photos of him. Either way, I will get Paypal their money.

Please save yourself the hassle and do CASH ONLY on Craigslist. Please learn from my mistake.

Thanks,
Chris



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