I paid for something with Paypal, but didn't get my stuff, what can I do?
By Admin
Created 10/12/2004

If you paid with your credit card, then you can put in a chargeback to your bank for "non-received goods." If you put in a chargeback for "unauthorized use," you will be in violation of PayPal's user agreement and PayPal will put that amount negative to your PayPal account. Either way, if you have no money in there now, you will go negative. If someone pays you for something else, PayPal will keep that money to offset your negative balance and you will be expected to reimburse PayPal. They will continue to keep any money anyone sends to your PayPal account. You will not have access to your account. This is known as "freezing" your account. You will never be able to use that account again, until you pay PayPal the money.

PayPal may also try to debit that amount to any checking account, savings account or credit card you have on file.

If PayPal does not recover the entire balance they say you owe, they will send you collection notices for the balance, and turn the account over to a collection agency. See the NCO collection notice page. They claim they will report you to the credit agencies as well.

If you paid with your PayPal funds or echeck, then you have a bigger problem. In this case you will need to file a police report in the location of the other person. You can do this by phone or mail. Use the net to search for the police department or sheriffs department in the other person's town. Example, "Boston police department," "Ammarillo Sheriff" or whatever. Depending on the situation, it will be theft or fraud. If it's in a smaller town, or if the police have a file on the person, you might get some satisfaction.

We know of one case where the cops knew the guy was a crook, but never had anyone willing to swear out a complaint that they could use to get a search warrant. When one of our users called the police and told them their story, the cops asked if they wanted to file a complaint. The user said, "Of course, that's why I'm calling," and then the cops took the complaint to a judge and got a search warrant. When the cops served the search warrant, not only did they find the stuff that was stolen from the user, but a garage full of stolen merchandise. I have no idea if the user ever got their stuff back, but there is some satisfaction in knowing the guy is now in jail.

In another case it was a teenager who was being a smartaleck. When the cops knocked on his door, and told the parents what was going on, they were understandably upset. The kid had a full scholarship to a college and the cops told the parents that if they arrested the kid, he would most likely lose his scholarship. The parents couldn't write that refund check fast enough. And of course I'm sure the kid caught hell.

But there is some chance of success to some degree if you file a police report and make yourself a pain.

Additionally you can file complaints with the California and Nebraska Attorneys General, FBI, Internet Crimes, et al in the US, UK and Canada. Get this info from the links page. You can also write to your local congress critter letting them know PayPal operates as a bank, but there are no regulations to oversee them, yet they handle billion of dollars of other people's money. It won't get your money back, but as more and more people complain, the likelihood of getting some oversight will increase.

Disclaimer: This information is not legal advice. It's general advice. I'm not an attorney. If you need legal advice you should consult with an attorney.