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Is Paypal Safe ?

Discussion in 'Ethical hacking Tips' started by shabbir, Apr 11, 2009.

  1. shabbir

    shabbir Administrator Staff Member

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    Go4Expert.com uses Paypal as one of the payment methods for $1 Daily competition and Monthly Article competition. This is not because it's one of the safest method of payment but we use it because of its Global Acceptance and ease of use. I have been scammed for $xx in Paypal and despite the seller failing to give proof and me giving all the documents for the last 30 days, the dispute did not end in anybody's favor.

    This is what has been done to me and the information here is for educational purpose only but I guess Paypal has not educated themselves since even today we can find many Paypal Scam videos on Youtube (some even older than 2 years+ now) on how to rob someone in Paypal and they are still Valid.

    Ok So this is how the Seller operated:

    You can have a couple of accounts in Paypal. One is Business and other is personal and then you need to find someone like me to give you payment in your personal account. In return you should be giving intangible Good or services to the buyer. Now when someone sends you the money in your personal account you immediately transfer them to the Verified Business account of yours and do not provide the intangible service. And Now let the Dispute begin!

    When the dispute starts the only available option for the buyer is to cancel the claim on the Resolution Center of Paypal and add extra information asked by Paypal. This option of adding extra information is very difficult to find. You actually have to use the Contact Us form to update the information which is quite confusing and not very clearly mentioned anywhere.

    Now in my case, the Dispute had started and the seller was not able to show the proof of delivery. So he needed to issue a refund. Now he issued a refund from a bank account which did not have any funds to transfer. Now Paypal, shows you the "refund issued status" meaning it would take some days for the bank transfer to go through (4-5 Business Days). Next, for the buyer, the only option available on Paypal is the "Dispute Cancel Button". So there are very high chances that on seeing the refund issued status you will click on it on the Resolution Center.

    As I had still some apprehensions and also had a phone conversation with Paypal support I did not click on the Cancel Button. But if you click cancel, the refund will never come and you also lost the dispute.

    Status of the Final dispute in my case is

    10-Apr-2009 PayPal Refund issued

    But I don't see any money coming my way.

    Also I see this FAQ in Paypal

    If the claim is decided in my favor, will I get all of my money back?

    If this claim is decided in your favor, we can't guarantee a refund. However, we'll make every effort to recover the funds from the seller.​

    It would take 30-45 days for the investigation and would get the following response as well.

    Dear XX XX,

    We have concluded our investigation into your case:

    Case ID: PP-XXX-XXX-XXX
    Transaction Date: 11-Mar-2009
    Transaction Amount: -$xx.00 USD
    Seller's Email: XXXXXXXX@ymail.com
    Seller's Name: XXXXXXXXXXXXX

    Unfortunately, we were unable to resolve this claim in your favor because the item purchased was virtual or intangible. As a result, we have not taken any action against the seller at this time but we have noted your dissatisfaction in the seller's record for future reference.

    If you still have concerns about this transaction, we encourage you to continue to work directly with the seller for an amicable resolution.

    Thank you,
    Randy
    Protection Services Department​

    Now if I could have worked with the seller why would I go for a dispute. All Automated mails.

    Now the question comes as to why does Paypal not support Escrow or even take a step to stop such scams.

    I can guess one reason can be having such loop holes attracts a large audience! (meaning customers!)
     
    Last edited by a moderator: Apr 11, 2009
  2. indiansword

    indiansword Security Expert

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    hey real good info mate.
    The very interesting part was that u transfer the amount immideately u get into ur account, so even if the seller claims the refund, there is nothing to be refunded.

    Paypal sucks, but thats the only method which is accepted worldwide.
     
  3. shabbir

    shabbir Administrator Staff Member

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    Yes and that is the GIST of scam
     
  4. shabbir

    shabbir Administrator Staff Member

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  5. infomercialscam

    infomercialscam New Member

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    Hello..

    Yes it is, because it follows international safety standards. Always check while opening paypal is that the address starts off with . it should not be . Notice the 's' after http. That shows you are accessing a secured server, and look for the lock sign on the bottom left corner of internet explorer. These r the signs that shows the site is secured. Although it is suggested that you should use a good firewall and an antivirus...
     
  6. harmstrong

    harmstrong New Member

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    for me Paypal was secure when in comes to money transaction process. But still we must careful to any transaction that we meet.Just maintain your privacy.
     
  7. bradwilson55

    bradwilson55 New Member

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    you must keep your privacy by your way.... PAYPAL is safe not to worry.

    But what is important is during your transaction it you are assure of all privacy like login id's, etc...
     
  8. coderzone

    coderzone Super Moderator

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    There is lot more issues when it comes to Fees as well and I would point couple of them.

    1. Cross Border fees (Merchants are slapped with an additional 1% commission on every transaction) which is nowhere mentioned and can be found easily.

    You can NOT see it here:
    https://www.paypal.com/us/cgi-bin/webscr?cmd=_wp-standard-overview
    or here:
    https://www.paypal.com/us/cgi-bin/webscr?cmd=_wp-standard-pricing
    or in the FAQ:
    https://www.paypal.com/us/cgi-bin/webscr?cmd=xpt/Marketing/merchant/wpstandard/WPStandardFAQs
    and its not part of the PDF datasheet either.

    You can only see this if you click the link for International Sales which is not the place where you go and find fees.

    2. Merchant fees are not auto reduced.

    If you make sale of 3k in a month you are eligible for a fee reduction and for millions of customers and users of a site you expect this to be automated but no ...how could Paypal possibly determine your monthly sales and adjust the rate.

    Again the process is a hell lot difficult and also does not apply if you miss it for a month and would like to get a refund from them.
     
  9. shabbir

    shabbir Administrator Staff Member

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    Right Coderzone :D
     
  10. mayjune

    mayjune New Member

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    i agree...its scary though, i mean having some background of comps we can understand the manipulation but so many have no idea what hits them!!!
    isn't there anything one could if one is in these kinda situation? there must be something....??
     
  11. shabbir

    shabbir Administrator Staff Member

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    Nothing. I could have done everything no matter what because I did knew something phishy before hand only.
     
  12. mayjune

    mayjune New Member

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    hmmm...thats scary to hear from you..
     

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