PayPal seller protection question

So I have been wondering about this for some time - How do sellers actually protect themselves from chargebacks for such things like RS gold?


If you are an independent trader, does this mean you cannot be protected? If you can how exactly, I understand a lot of people use the family/friends payments, but at the same time you can also do it via service/goods, and possibly get more coverage?

 

From what i have seen you are never 100% safe. You can have the guy his id and other stuf they can stil pay the transaction over a vpn and later claim they did not do the transaction and paypal would give them the refund.

 

Checking for VPN's etc is the very minimum thing to do, i'm more on about further than this.

 

You can check if they are with a vpn on your website , They could just sign on on a vpn when they go to the transfer page and disable vpn again when they transfered the money. And i don't think there is a guaranteed seller protection since we are talking about virtual goods there will never be a signature on delivery that can prove the goods are delivered.

Quotes from paypal website
What do I do if a buyer files a claim or a chargeback for an unauthorized payment?

Spoiler

PayPal will place a temporary hold on the funds in question and send you an email requesting proof of shipment.

Once we've received your proof of shipment, we will determine whether or not your transaction is eligible for coverage. If it is, we'll lift the temporary hold and restore your access to the funds as soon as possible. If it isn't, we'll return the funds to the buyer's account and you may be responsible for PayPal's chargeback fee, if applicable.

Read the PayPal User Agreement for our complete terms of coverage.

What should I do if a buyer files a claim or a chargeback for an item not received?

Spoiler

PayPal will place a temporary hold on the funds in question and send you an email requesting proof of delivery.

For payments of less than $850 (or its equivalent in another currency), you will need to provide proof of delivery that can be viewed online. For payments of $850 or more, you will need to provide proof of delivery with signature confirmation that can be viewed online. Once we've received your proof of shipment, we will determine whether or not your transaction is eligible for coverage. If it is, we'll lift the temporary hold and restore your access to the funds as soon as possible. If it isn't, we'll return the funds to the buyer's account and you may be responsible for PayPal's chargeback fee, if applicable.

Read the PayPal User Agreement for our complete terms of coverage.

 

As a gold seller you are not protected under PayPal Seller protection.

The way to get ahead is selling in volume, imposing purchase limits, and reducing fraud as much as possible through verification questions.

With an unauthorized chargeback you provide ID, IP Address, Browser fingerprint, proof they are in control of the email, etc to try and prove it was them making the transaction. With goods not received, you just try and explain the situation best you can and make it obvious to PayPal even though you're not covered by their protections the other party is trying to commit fraud. This is about a 50-50 thing doesn't always work in your favor. If the dispute is over $100 I'll often send a physical package with some rocks in it and provide the tracking number. That'll increase your chances of winning the dispute.

 

There's no way to make it 100% safe. If there was then fraudsters would abuse that too form the other end of the spectrum.

If you do not have a website, with layers of fraud prevention (not going to elaborate here as I know you do not have a site), then your only options are to:

1) Focus on sales volume rather than selling high quantities to fewer people. For example, sell 50M 07 to 10 people, instead of 500M 07 to 1 or 2 people.

2) archive all chatlogs, most of the time skype chatlogs do not suffice at all in your counter argument in a paypal dispute, mainly because the only way to effectively prove the other parties IP is via third party software and/or IP resolving websites/services.

3) sell to reputable resellers and settle for a few cents less, rather than trying to undercut site prices and selling to non reputable members.

4) be strict and keep business separate from online relationships. Just because you've traded somebody 12 times, doesn't make them much less of a risk. You can of course take the risk, but you have to accept full responsibility and not bitch if things turn sour. Make it clear to them that although you enjoy speaking with them, you will not raise their buying limit.

 

I feel i should also very quickly explain the most common types of paypal fraud, which a lot of people call a "chargeback" when in fact this is a false generalization, as not all are infact chargebacks.

1) When a buyer claims they did not receive their product.

These guys are really special. Because 9/10 times they do this, they will instantly lose the dispute. Especially if you take the time to have a calm phone conversation with PayPal. Explain to them it is a virtual goods transaction and that you delivered the virtual game upgrade service. Call it a virtual game upgrade service as it makes more sense to them as they may not know exactly what runescape gold is.

Sometimes the scammers try ad claim it was a physical product, this is where you use your delivery proof evidence you've archived in correlation to what you're telling them in the phone call. The support worker on the phone will check the files you've uplaoded while you're on the phone and most imes will close the case in your favour, even if you have to wait for a while.

2) False unauthorized payment claims

Similar to the first bunch of idiots mentioned above, you have the slightly smarter breed of scammers. These often offer to pay with gift as "it cannot be charged back bro". What they do is they claim they didn't authorize the transaction by either saying their 3 year old brother sent the money, or they got hacked.

To in these, it's easier if you have a website as you can more easily prove it was the owner of the paypal account that sent the payment. Again, with a phone call to paypal, these are relatively easy to win, but they can take a little longer. Especially if the scammer contacted their bank instead of paypal. As the bank is a third party, they have to communicate with paypal back and forth until the outcome of the case is decided.

If it's an idiot who ordered on a free VPN/proxy from their home computer and own paypal account, you have a good chance of winning this too.

3) Genuine fraud - the messy one.

This is when the person who is disputing you is actually genuinely a victim of fraud. Their paypal account or card details have been obtained by real world fraudsters, often known as 'carders' in this case.

What they do is they use stolen paypal accounts, bank accounts, or credit cards to purchase gold from you. They then resell the gold to cash out clean funds.

This is a problem as these guys usually know what they're doing. They order from socks proxies in a radius close to the victim, or in some cases they even use a genuine hijacked computer which they have installed a remote access trojan on previously (RAT).

This 3rd scenario is where you're pretty much fucked if you do not have a website, as it's very difficult to prove or even understand this has happened yourself without decent IP logs and chatlogs, such as a live chat export.

Even with evidence it can take weeks, and sometimes months to be reimbursed for this, depending on the country the victim is located and card/bank company they use. If it was simply their paypal account that got hijacked and the balance in there was used, Paypal will reimburse you for the loss and also return the stolen funds to the victim.


I could write 100 pages on all the different experiences I've had as a goldsite owner against carders, but the 3 above are all you need to know for now as it's unlikely you'll be targeted much unless you're moving bills daily through a site. Carders tend to target sites as it's easier for them to do so being that most sites are online 24/7.

 

Paypal is horrible unfortunately. There's no safety net whatsoever. F&F payments can be charged back just as easily.