Fighting a Fraudulent Chargeback

[WhatNoWebsite]

Absolutely appaled at how a recent chargeback has been dealt with by PayPal.

Sent a client a quotation which very clearly states there is a 12 month minimum term, they agreed to our standard terms and conditions which also state that we own the IP until all outstanding balances have been cleared and still PayPal side with the buyer. Absolutely astounded.

Posting here, on a site that's owned and operated by PayPal...? Doubt it'll have much impact but I have to warn others.

We designed a website for a client with a lot of customised code to get it to work the way they wanted (hand coding was not included in the quotation) and we billed the client for:
• The component used to display properties for rent
• 1st months retainer
• 2nd month retainer (10 further payments due)

Client then decided to issue a chargeback and simultaneously took down their other website and we suspect this was because are operating in a grey area of the local laws relating to property lets.

We sent the quotation to PayPal, the invoices, all paid up to this date and miraculously PayPal refunded the invoice that was for the component (a mere 99€) but not the other two payments.

Then, when we opened up a dispute against all 3 claims and provided documentation PayPal sided with the buyer on all 3 cases.

Shocked and appaled.

Our only recourse now is to persue this through the courts and stop all payments going through PayPal.

Unless anyone has any other suggestions...?

[Whac-A-Mole]

so this is for service rendered,not goods sold.

Paypal is not your ideal payment method for service as you cant prove physical delivery with online viewable tracking showingit has been delivered to his shipping address IN THE Paypal payment notice.

if you click on the transactions or if you still h ave the payment notice,pay attention to 2 sentences-item is ful or partial eligible for seller protection,you must ship to this address .

dispute for service rendered is reviewed by a person,not a robot and will take time and expertise like in your case.

contract means nothing ,you need to prove you have delivered the service,like in your case,a website with handcoding etc,give them a link to the site.

multiple payments for one service job complicates the matter,you may want to review Paypal buyer/seller protection on multiple payments for one single item,this could explain why he only gets the contract money back,but not the installment payments.  

you file claims on the other payments,why?

you can try appealing but not sure if it will go anywhere?

also if he loses ,he could file chargeback with his cc issuer and with multiple transactions,you get socked with$20 chargeback fee for each transaction and it adds up.

if you search this forum,you read about sellers losing dispute for service rendered-massage,haircut,photography,drywall,plumbing,catering service,talking dirty,but IT work stand a better chance of winning .

LOOK for a different payment method,esp if you have contract and installment payments,PAYPAL IS good for single payment of physical goods .

or if you insist on paypal,do like the car sellers do,accept a paypal deposit,ask for cash upon completion in whole and refund his Paypal payment,then he cant dispute any thing.

or send him hard copy of your work with tracking,not perfect,but better than nothing

[Whac-A-Mole]

one can get a money order in a supermarket for little money,give him the money to buy a stamp and money order and send it to you,ELSE NO DEAL.

[WhatNoWebsite]

Herein lies the rub...

We have proof of delivery, the website. It's fully functional and all we get from PayPal are standard responses which simply do not help.

We even offered a to take a 5 minute phone call which they refused as this would have quickly resolved the issue. All they'd have had to do was take a few minutes to look at the website and make a reservation, they'd have seen it is working.

We've had to leave the website up and running throughout this simply to satisfy PayPal who haven't even looked.

You suggest using another processor, we already do. PayPal accounts for a small percentage of our throughput, European customers mostly but it seems we may have to stop using the platform.

Also, handing final code to a client is something we routinely do but only once a contract is finished, this contract was only 2 months into a 12 months contract. That said, the client has full administrative privileges from day 1 so could have easily logged in and downloaded an entire copy of the site and have it operational elsewhere for all we know. All that would be required is a few changes to the content and we'd never find out.

While your comments are helpful it's not a solution to this problem and meanwhile the client continues to make defamatory remarks about us in support of their case in the public domain which we're having to deal with seperately.

What I'd like to see happen are two things...
1. A person from PayPal actually takes ownership of this issue personally
2. A process is put in place to ensure that if we (and other design agencies) choose to continue using PayPal that some form of guaruntee is in place that we can adhere to

I don't think the 2nd point is too much to ask, every freelancer website out there have systems in place. And as for the 1st suggestion it would be nice but ublikely as PayPal make money either way, they probably don't care what we post about this in public but it would be nice all the same.

[Whac-A-Mole]

you have won the first dispute,you get your money back.

now you need to look into multiple payments for one purchase,what does Paypal have to say about multiple payments for one purchase/order,for both buyer and seller?

I recall there is no protection,but you may want to find out for sure.

as for European customers using PAYPAL to make payment,they can always use money gram,western union,if they want it,they will meet your demand.

I am one of the old timer who sells on Ebay,back then buyers pay with cash,check,cashier check,money order,postal order,wiretransfer,even Ebay accepts personal checks.

of course now they all use Paypal or credit card,no one mails me a check anymore.

[WhatNoWebsite]

I didn't win my money back though, PayPal REVERSED their decision when I appealed all three cases as they are all tied to the same quotations provided to and accepted by the client.

This is just outrageous. I've also since discovered that a buyer can open a claim up to 180 days after a payment. Incandescent !

So, looks like I will have to persue the client through the courts which will take years here and publicise how PayPal treat their sellers iin the public domain.

Absolutely outrageous.

Oh, and to add insult to injury PayPal called me to ask that I pay off the negative balance. The negative balance that THEY put me into by reversing a payment from a fraudulent buyer !!!

I really fail to see how PayPal can side with a buyer when we have provided the quotation - which the client agreed to, in which it very clearly states 12 months minimum terms.

We have provided PayPal with the website - Finished !

And we have provided all the documentation required.

Like I said, it's off into the courts and the public domain with this one. PayPal simply hide behind automated responses and don't even take the time to read what we send them.

Time to see just how much social reach we can muster and with around 20,000 followers I'm pretty sure some will feel the same way.

[AkshayP]

WhatNoWebsite,

I completely agree that PayPal can be supremely frustrating and that quite simply they are no always reliable when it comes to disputes particularly of the chargeback variety. instead of going through PayPal or subjecting yourself to something like this where you are relying on PayPal to come through for you I would suggest that you look up preventative chargeback measures you, yourself can take. If this doesn't or hasn't made a difference then go ahead and PM me or respond to this thread and I can give you some solutions or ideas that I have done myself and hopefully that can help you as well in preventing and solving these chargeback disputes.

Best,

AkshayP

[WhatNoWebsite]

Any feedback greatly appreciated.