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EBay to cut fraud risk, but only for PayPal payments

By Jacqueline Emigh, BetaNews

June 20, 2008, 2:01 PM

To help prevent fears of online fraud among buyers and sellers alike, Internet auctioneer eBay plans to abandon its previous limits on transaction protection beginning this fall.

The upcoming changes apply only to payments made through PayPal, however, as opposed to checks, direct credit card payments, and other forms of payment used by some buyers and sellers on eBay.

Right now, people buying goods through eBay via PayPal are only protected for up to $2,000 per transaction if the purchased item never arrives, or if it varies significantly from the seller's description. Sellers, on the other hand, are currently protected for only $5,000 annually against claims, charge-backs, and reversals from eBay buyers.

But in one of a series of moves made by new Chief Executive John Donahoe -- who replaced Meg Whitman on March 31 -- eBay will lift all caps on PayPal buyer and seller protection after the end of this summer.

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By D-ZeRo

edited Jun 30, 2008 - 9:04 PM

yeah right they are not able to do anything help buyer i don't think so!! it happened to me i bid on item i won it i paid it, received an alert from eBay that the listing was removed cause it breached there policy and we all know what that means..... meanwhile i haven't received the item i opened a claim in PayPal like eBay suggested to get my money back but PayPal said this claim does not qualify for a refund.We found the seller to have accurately represented the item(s) in question. and i am still with nothing just a printout of the listing the seller sent me (how funny).........

Score: 0

By Hatchet101

edited Jun 28, 2008 - 2:59 PM

The truly sad part of it all is simply that eBay and, now since it's ownership of paypal, paypal too.. are most interested in protecting the seller, legitimate or not. Only the sellers butter thier bread. Whether an item sells or not the seller pays. Power sellers keep eBay alive. ebay will overlook the fraud that occurs there and even remove negative feedbacks a month or two down the road when they think nobody is looking anymore. Additionally, seller beware. eBay CAN NOT reliably detect shielding and shill bidding, nor does it's autobidding system work, as it only takes 2 false accounts to overbid any item and retract just before the close and it it completely undetected. Same methods are used to match a reserve price, even though the reserve is deemed the minimum a seller will take. Worse, eBay/paypal now cover purchase amounts to $2000 with talk of lifting this cap, but still will not cover shipping and handling of misleading ventures. There are just too many horror stories here. I have lived through a few and now would not give creedence of any $ amount to buying or selling on eBay in any amount that exceeds what it costs to feed my dog in a month.

Score: 0

By foxfyre

posted Jun 21, 2008 - 9:58 AM

You essentially already have this if you pay with a guaranteed credit card and return any fraudulent merchandise by trackable service such as UPS - much to PayPals unending ire.

CC chargebacks work just great - although PayPal hates to actually deal with the issue.

Just beware if you have a credit balance with Paypal! Or heaven forbid someone defrauds you as a merchant! PayPal's history is SLIGHTLY(sic) LESS than stellar!

As a merchant OR buyer, if you can't afford to eat a loss or are concerned that an item is as represented or need to inspect fragile items prior to the release of funds DEFINITELY go to www.escrow.com and forget PayPal.

Score: 0

By partypop

posted Jun 21, 2008 - 5:15 AM

I believe this is a step to a more secure Ebay.
Paypal already has a nice dispute console, just incase its needed. Now with more protection that will make purchases more comfortable.
Good job.

Score: 0

By mjm01010101

posted Jun 21, 2008 - 11:46 AM

Yeah I disputed an item on paypal and it worked exactly as I expected it to work. Problem was was it takes 30 days and then some to resolve, so the dude had my money for 30+days. However I got it all back and did not have to ship the item back.

Score: 0

By foxfyre

edited Jun 20, 2008 - 8:35 PM

Too little too late.

Why they haven't moved to an escrow style system for ALL transactions over say $50 like escrow.com employs that would effectively eliminate all fraud and misrepresentation for both seller and buyer is an amazing study in both arrogance on the part of EBAY/PayPal and ignorance on the part of the consumer.

Besides, Ebay has ceased to be a source of good deals and become a site where you watch newbie idiots quickly bid up items beyond their retail price within a day of a 7 day listing. Sad, but funny in a perverse manner!

Score: 0

By Gungistoker

posted Jun 22, 2008 - 7:54 PM

The obvious reason is because eBay owns PayPal.

Score: 0

By foxfyre

edited Jun 22, 2008 - 10:08 PM

Now.
Ebay bought PayPal in the summer of 2002.

As as mentioned, there is no reason that both could not have MUCH more effectively mitigated fraud utilizing an easily implemented escrow option. As such, this is far too little and FAR too late.

And anyone who's been around Ebay for a while knows that neither Ebay nor PayPal have handled disputes in a proactive manner - in fact being forced by the courts to finally provide a contact phone number which is still judiciously difficult to locate.

Few organizations have earned the sh!tty reputation they enjoy like these too companies. And its a shame, as it could have been so easily avoided.

Not intimate with the history? Just google 'PayPal sucks' and stand back... And talk to any of the merchants who had their accounts frozen without recourse for things they had no part in... Sorry, I have had too many experiences with PayPal to harbor any sentimentality for their historically shoddy manner of doing business.

And as I have stated, if you can't afford to eat the loss, pony up the $25 (split with the other party) and protect both party's interests by using www.escrow.com. It even affords you the opportunity to inspect or have a 3rd party inspect the merchandise before funds are released upon approval or the merchandise is returned in a trackable manner. And the terms are easily modifiable in collaboration with the other party.

Score: 0

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