Texas (and other states) come down on PayPal........>>>>>

[Johnny SixPack]

Some good news IMO. 

AUSTIN, September 28, 2006 – Texas Attorney General Greg Abbott today hailed an agreement he reached with online payment service PayPal as a landmark victory for millions of consumers and businesses using the online service to send and receive payment for goods and services worldwide.

An Assurance of Voluntary Compliance filed by Texas and 27 other states sets forth strict disclosure and customer service standards the company must follow. Failure to comply with the new requirements would allow states to take further legal action against PayPal.

"In an age when online commerce is an integral part of our economy, those providing the tools that move billions of dollars in daily Internet transactions must do so by dealing fairly with the public," said Attorney General Abbott. "We hope this agreement with an industry leader will set standard best practices for Internet businesses across the country to follow. Consumers across the State of Texas will benefit from PayPal's promise to conduct itself with transparency and integrity ."

The agreement addresses numerous business practices, including PayPal's failure to provide customers with adequate disclosures regarding key components of its service, including dispute resolution and chargeback practices, selection of funding sources, buyer and seller protection programs, and the freezing of vendor accounts.

According to the company, PayPal, which is owned by the online auction site eBay, has grown to a membership of over 100 million accounts worldwide since being founded in the late 1990s.

Among users' chief grievances addressed by the attorneys general is PayPal's failure to clearly disclose the consumer's funding source for a given transaction. Consumers complained that the company did not clearly disclose the funding source for each purchase, and thereby withdrew money from a consumer's bank account, even if users submitted their credit card information when signing up. As a result, many consumers learned that money had been withdrawn from their bank accounts only when they received their monthly bank statements, even though their intention had been to use a credit card.

Other consumers complained that during pending disputes with PayPal, the company would freeze funds held in the user's PayPal account. Consumers' complaints also reflected confusion about the difference between PayPal's in-house dispute resolution programs and chargeback rights granted by federal law to consumers using electronic banking, debit and credit cards to make purchases.

Under the agreement, PayPal must present consumers with a clear choice regarding the form of payment, and, prior to finalizing the consumer's payment, must clearly and conspicuously disclose whether the payment is being funded from the consumer's bank account or their credit card. Additionally, any Webpage that promotes a PayPal buyer protection program where a user can make a payment must provide clear and conspicuous disclosures about the limitations or conditions that apply to that program.

The agreement also spells out new requirements for freezing customer accounts, including limiting access to funds only in such amounts as are deemed reasonably necessary to protect against risk. Prior to this agreement, PayPal would simply freeze the entire account.

Finally, the agreement provides relief to consumers who complained about their ability to reach PayPal by telephone in order to resolve problems with their transactions. Under the terms of the agreement, PayPal will establish a conspicuous "Contact Us" link on all of its Webpages, provide a customer support number which is operational at least 18 hours each day during the week (14 on weekend days) and answer calls promptly.

Consumers in Texas who face ongoing problems with the company or who wish to complain about other online payment services can contact the Office of the Attorney General online at www.oag.state.tx.us or by calling toll free at 1-800-252-8011.

How on our local Liberty County website:

http://www.i-dineout.com/pages2006/abbott.9.28.06.html


Johnny

[dodge freak]

Pay Pal stinks big time. You send someone cash-they take a cut, you get a refund-they take a cut. Somebody pays you-they take a cut. Its like a loan shark guy. Credit Cards now are cool . You get a refund-you get the full amount. The way it should be.

[Charger_Fan]

I've never had a problem with Paypal **knock-on-wood**, but I don't do any high dollar purchases with it either.

[TruckDriver]

I've never had a problem with Paypal **knock-on-wood**, but I don't do any high dollar purchases with it either.

Same for me.

[Johnny SixPack]

I've never had a problem with Paypal **knock-on-wood**, but I don't do any high dollar purchases with it either.

I used to collect watches as a hobby and had a friend who also did.

He funded his website and hobby by selling new watches (Seiko, Citizen, Orient).

99% of his transactions were through PayPal (since many of his orders were from around the world) and he had a $7000.00 (USD) balance in his online account.

Somehow PayPal messed up their records and before he knew it they had frozen his account, and his $7000.00.

Took almost a year before he was able to get all of the money back.

Ever since then (and the fact that they 'accidentally' billed my bank account instead of my CC causing me $50.00 in overdraft fees) I've avoided PayPal whenever possible.

[doctorpimp]

Bank transfer is set-up as the default by PayPal.  When you go to make a purchase, it shows you that $X.XX will be withdrawn from XXXXX account.  Just below that is a hyperlink for "More Funding Options".  When you click on that you have the coice of any of the payment methods you have set-up (Visa, MC, Other cash account)
Just like anything else, read everything before you click OK when dealing with money.


I have never had an "accidental" withdrawl from my Bank account when using PayPal.  I actually prefer using them (an independent 3rd party) when making online transactions.  I feel more safe, than giving my CC# to some company that may/may not be 100% legitimate.
So what if you get charged for transactions.  The same thing occurs when you buy a money order, and stamps... 
You pay for the convenience, just like using an ATM and getting the $1 per transaction fee etc.

[Charger_Fan]

I've never had a problem with Paypal **knock-on-wood**, but I don't do any high dollar purchases with it either.

I used to collect watches as a hobby and had a friend who also did.

He funded his website and hobby by selling new watches (Seiko, Citizen, Orient).

99% of his transactions were through PayPal (since many of his orders were from around the world) and he had a $7000.00 (USD) balance in his online account.

Somehow PayPal messed up their records and before he knew it they had frozen his account, and his $7000.00.

Took almost a year before he was able to get all of the money back.

Geez I agree, that would suck.

[Drache]

I had purchased something off ebay totally just over $200. I paid using paypall and weeks down the road I find out the guy cheated me out of the stuff so I told paypal. All I got back was the lousy $2.50 he had in his account to keep his account active, good by rest of my money. I contacted paypal again about this and the BS of it all and they pretty much told me "sorry, cant to anything else".

One part of the compliance that Texas put forth is that if you get ripped off, the money will be taken off the credit card used to sign up for the account.