alert Strange PayPal Glitch Causing Chargeback

[FPForum]

I had the strangest thing happen yesterday and wanted to make everyone aware in case the same happens to you. Yesterday around 5:30PM I received an email from PayPal stating that a dispute (unauthorized) had just been filed on a domain I sold through NP last year. The one important thing about this claim was that the domain had been sold in April of 2016. Yes, almost 1 year ago exactly..

I began doing some research and @Eric Lyon (plus another admin and a few other great NP'ers here) all helped me gather the evidence I needed to trace where the name had gone since I sold it, plus get me some additional information that I could provide to PayPal.

Around 1:30AM (Before I could even get my evidence together and respond to the claim) I received another email from PayPal stating the dispute had been closed in the buyers favor and the refund had been issued. This had me extremely confused and worse of all, PayPal's customer service department was closed and there was literally nothing I could do until they opened..

I called them first thing this morning and reached a dispute representative to explain my story. The second I mentioned that this transaction was almost a year old she immediately knew something was wrong. I was put on hold for a few minutes and then told their was a glitch in their system and this should have never happened. Within 3-4 hours the money was back in my account and I was good to go.

To the best of my knowledge, buyers aren't even able to file claims after 180 days. I spoke with the user who bought the domain from me and feel confident he didn't file this claim. One total guess I have is that maybe PayPal is/was having some issues since there was that big Amazon server crash last weekend. I have no idea if they use Amazon's cloud services, but there is obviously some type of bug in their system and this has never happened to me in the years I've been using them..

If you notice a chargeback or claim on your account for anything that was sold over 180 days ago - Make sure you call PayPal first before starting threads calling anyone a scammer or something like that. After reaching them on the phone it was a 5 minute conversation and they confirmed the error was on their end before resolving it extremely quickly.

 

[johnn]

That's good news.

 

[DNWon]

That's good news.

That's far from good news...360 day chargebacks...by mistake! WTF PayPal?

 

[FPForum]

@johnn - Thanks, and thank you again for your assistance yesterday!!
@TheDot.shop - LOL that was my first thought. Funniest of all it was an "unauthorized" chargeback. Like someone just saw their statement a year later and just then wondered what they had bought.

 

[NameOmnia]

Holy Eff that is scary! I mean a glitch that can file disputes and refund money after light years have passed?
PayPal is becoming more worrying by the day.

 

[SlimPickins]

really appreciate you taking the time to detail what happened, and glad it was fixed quick! That would be utter chaos if anyone, let alone lots of us, had to truly worry about chargebacks on domain sales a YEAR ago!

 

[Kuffy]

It must be coming up to their financial year end. There is a history of reports about PP taking money from customers to add to their p&l account. In fact, if I remember correctly, that was why they were ordered to pay $600 million in compensation several years ago.

 

[enamebroker]

it is a strang story.

 

[Kate]

 

[Paul]

I'm going to ask around in the security community to see if anyone has heard of this. PayPal is notorious for its heavily-abused dispute process, but this sounds a bit different.

 

[AutoDealer]

Interesting and I thought this was outlined in the FDIC that nothing over 60 days was able to be disputed. I'll have to check but if they did anything like that to me I'd sue them. Also, I stay away from PP as much as I can.

I began to use Escrow.com and also CASHIERS CHECKS. I've even had someone fly in to complete a domain transaction with cash. I'm old and I trust no one.

 

[Paul]

I'm going to ask around in the security community to see if anyone has heard of this. PayPal is notorious for its heavily-abused dispute process, but this sounds a bit different.

Consensus is they simply social engineered PayPal support, and PayPal is just saving face when you call and complain by saying it's a bug. It's been an issue for years, although I didn't realize there was quite that much dishonesty involved on PayPal's part.

Quote from a security group chat on Telegram:

[06.03.17 02:05] as someone SE'd their support to make the dispute
[06.03.17 02:05] and get it closed instantly
[06.03.17 02:06] it's been an issue for years
[06.03.17 02:06] they're just saving face when the customer calls and complains

SE'd = social engineered

 

[Paul]

Interesting and I thought this was outlined in the FDIC that nothing over 60 days was able to be disputed.

They've avoided being classified as a bank for a long time now (and gone out of their way to do so), so the FDIC doesn't have much control over the situation.

 

[AutoDealer]

They've avoided being classified as a bank for a long time now (and gone out of their way to do so), so the FDIC doesn't have much control over the situation.

Thank you for the information that makes me trust them less than I already do.

 

[Paul]

Thank you for the information that makes me trust them less than I already do.

Yeah, they're a really slimy company, and it's only getting worse. The same issues have been around for nearly a decade now.

 

[elevator]

NiceNews.com Thanks

 

[FPForum]

Thanks for looking into this a little more @Paul Buonopane! It was a mid-$XXX sale and the buyer on the board here has solid feedback, been around since 2014..etc. Do you really think it could have been social engineered? At first glance I thought maybe the unauthorized transaction was coming from the bank since I'm almost certain there is no way to do it from inside PayPal that far down the road. But then I thought heck, I can't even think of a bank that would take on such a claim that late, lol.

That's pretty bad if people can social engineer a chargeback almost one year later. Kinda scary as PayPal shouldn't even look at a transaction if it's that old...

 

[TerriJ]

Thanks for looking into this a little more @Paul Buonopane! It was a mid-$XXX sale and the buyer on the board here has solid feedback, been around since 2014..etc. Do you really think it could have been social engineered? At first glance I thought maybe the unauthorized transaction was coming from the bank since I'm almost certain there is no way to do it from inside PayPal that far down the road. But then I thought heck, I can't even think of a bank that would take on such a claim that late, lol.

That's pretty bad if people can social engineer a chargeback almost one year later. Kinda scary as PayPal shouldn't even look at a transaction if it's that old...

I think I'm confused. So who social engineered this? The original buyer or Paypal?

 

[FPForum]

I think I'm confused. So who social engineered this? The original buyer or Paypal?

If there would have been any social engineering going on then it would have been on the buyers part. But, there would be no real way to prove it unless you were at PayPal. But, I was able to resolve the issue by calling PayPal.