- Report: #185769
Complaint Review: Paypal Australia - Nationwide
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Paypal Australia
Nationwide, Australia
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Paypal Australia Overdrew Bank Account Without Authorisation ripoff Internet *EDitor's Suggestions on how to get your money back into your bank account!
AUSSIE PAYPAL VICTIMS PLEASE READ THIS
I am in Australia. I recently added a bank account to my Paypal membership for the purpose of withdrawing sale funds and paying for purchases. I read the promotional information and Product Disclosure pertaining to this action.
The information headed 'Five Benefits of Adding a Bank Account' included the following statement:
"In the event that there is not enough money in your bank account to make a payment, a debit or credit card acts as a back-up funding method". I have a credit card registered with Paypal as a source of funds so believed that the section of the PDF relating to dishonour fees if the account contained insufficient funds to complete a transaction did not apply as I had in place a back-up funding source. WRONG!!
On 6 April I used Paypal for a US$322.00 payment. My bank account (which is specifically used for internet purchases) contained the equivalent of $228.00 and I expected the balance to be debited against my credit card. When I checked my account on 8 April I found it showing an overdrawn amount and a deduction by Paypal described as an "Automatic Drawing".
I contacted my bank to find out how a third party could overdraw an account that did not have an overdraw facility. They said that it was bank policy to allow overdraws for periodic or AUTOMATIC drawings where they hold a debit authorisation from the account holder as they were usually for loan repayments, medical insurance etc and the account holder would be inconvenienced and perhaps subject to default action if the payment was rejected.
I asked if payments for which they did not hold a debit authority would be paid as an overdrawal and they said no. I then asked if they had a debit authorisation from Paypal and they said they did. I have never signed such an authority - and a signed authority is required under Australian law - and asked for a copy which is being sent. I insisted that the transfer to Paypal be reversed which they did as I think they had a look at the authority and realised it was not valid. They also blocked any further payment requests from Paypal.
I then sent a fraud report to Paypal stating the above and requiring them to immediately reverse the transaction and source the entire payment from my credit card. They replied that my bank account was my Primary Funding Source and they would attempt to debit my account TWICE (with me incurring a $35 overdraw fee from the bank each time) before they would access the credit card. This is because they incur merchant fees and have no control over the exchange rate that applies (no 2.5% currency conversion ripoff for Paypal) if they do that.
I then rang the dispute resolution line and got to spend an hour on the phone with Ron who told me I had not read the conditions, that Paypal could debit my acount for the total amount regardless of the amount of funds available and keep doing it until the transaction processed or the bank advised them that funds were not available. I asked why Paypal used the words AUTOMATIC DRAWING instead of describing the request as payment for goods purchased and he didn't know.
I asked if he - as he assured me he had read the User Agreement hundreds of times - where in it Paypal stated that they would repeatedly access my account instead of using the back up funding. He said it wasn't in there but that was standard Paypal PRACTICE and they didn't need to disclose it.
I asked if he understood Australian financial services law and he said he did not. I asked for a phone number for a Paypal manager in Australia and he wouldn't give one. I found one on the Paypal website and called it but it reverted to their USA head office.
Once I receive the debit "authority" from my bank I will be placing the matter in the hands of the Australian Financial Services Ombudsman who investigates this type of fraud and has the power to recommend prosecution under the Financial Services Act.
I spent many years working in the insurance industry and am conversant with financial services law and obligations that apply to companies which operate on-line and rely on a Product Disclosure Form to validate internet transactions. Basically it is the service provider's responsibility to specify any costs and/or penalties that COULD result from a client's use of their service. The 'Add A Bank Account' form provided on-line by Paypal does not state that completion of the form constitutes an authority for them to debit my account, nor does it state the procedures they will employ in debiting that account.
These areas are the ones I will raise with the Ombudsman, together with Paypal's failure to provide a link anywhere in the form to relevant sections of the PDF.
Would anyone else in Australia with a similar experience please contact me as it will add weight to my attempt to ensure Paypal fully discloses its practices before encouraging people to provide their bank account details. Cliff
Cliff
ESK
Australia
EDitor's Suggestions on how to get your money back!
HERE IS WHAT RIP-OFF REPORT SUGGESTS YOU DO:
Go to your bank within 60 days of the charge, or as soon as you know about the charge, don't delay, and tell them that there has been fraudulent activity within your account. Explain that you wish to file a dispute, and demand that they assist you in accordance with Federal Regulation E.
According to the majority of victims interviewed by Rip-off Report, those who immediately called their banks to dispute the charges did not get very far. Many victims got the following responses from their banks: we could not do anything for you or you waited too long; it has been more than 60 days.
If the bank is says that you have waited too long, explain to them how you called their 800 number as soon as the charges were found, and were told by the bank that nothing could be done. Remind the bank that they failed to assist you properly at the 800 #, and instead, provided you with an inadequate explanation of your right to dispute. Tell the bank that it's their fault time has expired, and since they gave you the wrong info to begin with, they will just have to deal with it, take the loss and reverse the charges.
Tell them the truth; this was unauthorized and your account was NOT to be charged! Keep emphasizing how you never authorized anything! Direct them to the hundreds of victims reports that were filed on Rip-off Report.com. And if you're at the bank, walk them over to their computer and make them go to this site! If you are on the phone with them, tell them you will wait while they access this site! Either way, be persistent!
DO NOT TAKE NO FOR AN ANSWER!
Let them know nicely, that you were advised to Report them (the Bank) and this situation to the Banking Commission in your state. Since each state has a different name for the agency/controller over banks, find that name before you call or get to the bank so you can throw it in their face. The more knowledgeable you appear to be, the further you will get.
And just continue to demand the Federal Regulation E form! The bank CAN, MUST and WILL reverse the charge! But, you must be persistent; ask to speak to the supervisor or the area manager for all the branches in the state.
Let the bank personnel know you are meeting with the media later in the day, that you would much rather they do the right thing (as most other banks have) by looking at the complaints and immediately reversing the charge(s) to your account; no matter how long ago it was. Be sure to call the Media if necessary so you are telling the truth.
If you have to, be loud (but nice) in front of other customers. If you are just calling by phone, the above tactics should still work. The bank can easily fax or mail to you the Federal Regulation E dispute form.
CHARGES TO YOUR CREDIT CARD
If the charge was to your credit card (not debit card, check card, or checking account), contact the credit card company as soon as possible to request a dispute form. Consumers usually have a little longer to dispute fraudulent credit card charges (up to 6 months), but it is better to act right away. In this type of situation, credit card disputes are usually successful since fraudulent companies often won't contest the disputed charge. In rare cases, credit card companies will review disputes, but refuse to reverse the charges. If this occurs, complain to a manager and let them know you will be filing a report here.
Remember Don't let them get away with it! Make sure they make the Rip-off Report .. The more Reports filed on a Company or individual, the more likely it is that the authorities, media and attorneys will want to take action.
And good luck Let us know how you do!
ED Magedson Founder, Rip-off Report.com & Author of www.ripoffrevenge.com
[email protected]
badbusinessbureau.com
www.ripoffreport.com
Don't let them get away with it.
Make sure they make the Rip-off Report!
We are not lawyers.
We are not a collection agency.
We are Consumer Advocates.
...the victims' advocate
WE are Civil and Human Rights Activists
We are a Worldwide Consumer Reporting News Agency
...by consumers, for consumers
CLICK HERE to read about Credit Card Scams... find out how to get your money back. *Rip-off Report Investigation provides valuable information.
Click here to read other Rip Off Reports on PayPal
I am in Australia. I recently added a bank account to my Paypal membership for the purpose of withdrawing sale funds and paying for purchases. I read the promotional information and Product Disclosure pertaining to this action.
The information headed 'Five Benefits of Adding a Bank Account' included the following statement:
"In the event that there is not enough money in your bank account to make a payment, a debit or credit card acts as a back-up funding method". I have a credit card registered with Paypal as a source of funds so believed that the section of the PDF relating to dishonour fees if the account contained insufficient funds to complete a transaction did not apply as I had in place a back-up funding source. WRONG!!
On 6 April I used Paypal for a US$322.00 payment. My bank account (which is specifically used for internet purchases) contained the equivalent of $228.00 and I expected the balance to be debited against my credit card. When I checked my account on 8 April I found it showing an overdrawn amount and a deduction by Paypal described as an "Automatic Drawing".
I contacted my bank to find out how a third party could overdraw an account that did not have an overdraw facility. They said that it was bank policy to allow overdraws for periodic or AUTOMATIC drawings where they hold a debit authorisation from the account holder as they were usually for loan repayments, medical insurance etc and the account holder would be inconvenienced and perhaps subject to default action if the payment was rejected.
I asked if payments for which they did not hold a debit authority would be paid as an overdrawal and they said no. I then asked if they had a debit authorisation from Paypal and they said they did. I have never signed such an authority - and a signed authority is required under Australian law - and asked for a copy which is being sent. I insisted that the transfer to Paypal be reversed which they did as I think they had a look at the authority and realised it was not valid. They also blocked any further payment requests from Paypal.
I then sent a fraud report to Paypal stating the above and requiring them to immediately reverse the transaction and source the entire payment from my credit card. They replied that my bank account was my Primary Funding Source and they would attempt to debit my account TWICE (with me incurring a $35 overdraw fee from the bank each time) before they would access the credit card. This is because they incur merchant fees and have no control over the exchange rate that applies (no 2.5% currency conversion ripoff for Paypal) if they do that.
I then rang the dispute resolution line and got to spend an hour on the phone with Ron who told me I had not read the conditions, that Paypal could debit my acount for the total amount regardless of the amount of funds available and keep doing it until the transaction processed or the bank advised them that funds were not available. I asked why Paypal used the words AUTOMATIC DRAWING instead of describing the request as payment for goods purchased and he didn't know.
I asked if he - as he assured me he had read the User Agreement hundreds of times - where in it Paypal stated that they would repeatedly access my account instead of using the back up funding. He said it wasn't in there but that was standard Paypal PRACTICE and they didn't need to disclose it.
I asked if he understood Australian financial services law and he said he did not. I asked for a phone number for a Paypal manager in Australia and he wouldn't give one. I found one on the Paypal website and called it but it reverted to their USA head office.
Once I receive the debit "authority" from my bank I will be placing the matter in the hands of the Australian Financial Services Ombudsman who investigates this type of fraud and has the power to recommend prosecution under the Financial Services Act.
I spent many years working in the insurance industry and am conversant with financial services law and obligations that apply to companies which operate on-line and rely on a Product Disclosure Form to validate internet transactions. Basically it is the service provider's responsibility to specify any costs and/or penalties that COULD result from a client's use of their service. The 'Add A Bank Account' form provided on-line by Paypal does not state that completion of the form constitutes an authority for them to debit my account, nor does it state the procedures they will employ in debiting that account.
These areas are the ones I will raise with the Ombudsman, together with Paypal's failure to provide a link anywhere in the form to relevant sections of the PDF.
Would anyone else in Australia with a similar experience please contact me as it will add weight to my attempt to ensure Paypal fully discloses its practices before encouraging people to provide their bank account details. Cliff
Cliff
ESK
Australia
EDitor's Suggestions on how to get your money back!
HERE IS WHAT RIP-OFF REPORT SUGGESTS YOU DO:
Go to your bank within 60 days of the charge, or as soon as you know about the charge, don't delay, and tell them that there has been fraudulent activity within your account. Explain that you wish to file a dispute, and demand that they assist you in accordance with Federal Regulation E.
According to the majority of victims interviewed by Rip-off Report, those who immediately called their banks to dispute the charges did not get very far. Many victims got the following responses from their banks: we could not do anything for you or you waited too long; it has been more than 60 days.
If the bank is says that you have waited too long, explain to them how you called their 800 number as soon as the charges were found, and were told by the bank that nothing could be done. Remind the bank that they failed to assist you properly at the 800 #, and instead, provided you with an inadequate explanation of your right to dispute. Tell the bank that it's their fault time has expired, and since they gave you the wrong info to begin with, they will just have to deal with it, take the loss and reverse the charges.
Tell them the truth; this was unauthorized and your account was NOT to be charged! Keep emphasizing how you never authorized anything! Direct them to the hundreds of victims reports that were filed on Rip-off Report.com. And if you're at the bank, walk them over to their computer and make them go to this site! If you are on the phone with them, tell them you will wait while they access this site! Either way, be persistent!
DO NOT TAKE NO FOR AN ANSWER!
Let them know nicely, that you were advised to Report them (the Bank) and this situation to the Banking Commission in your state. Since each state has a different name for the agency/controller over banks, find that name before you call or get to the bank so you can throw it in their face. The more knowledgeable you appear to be, the further you will get.
And just continue to demand the Federal Regulation E form! The bank CAN, MUST and WILL reverse the charge! But, you must be persistent; ask to speak to the supervisor or the area manager for all the branches in the state.
Let the bank personnel know you are meeting with the media later in the day, that you would much rather they do the right thing (as most other banks have) by looking at the complaints and immediately reversing the charge(s) to your account; no matter how long ago it was. Be sure to call the Media if necessary so you are telling the truth.
If you have to, be loud (but nice) in front of other customers. If you are just calling by phone, the above tactics should still work. The bank can easily fax or mail to you the Federal Regulation E dispute form.
CHARGES TO YOUR CREDIT CARD
If the charge was to your credit card (not debit card, check card, or checking account), contact the credit card company as soon as possible to request a dispute form. Consumers usually have a little longer to dispute fraudulent credit card charges (up to 6 months), but it is better to act right away. In this type of situation, credit card disputes are usually successful since fraudulent companies often won't contest the disputed charge. In rare cases, credit card companies will review disputes, but refuse to reverse the charges. If this occurs, complain to a manager and let them know you will be filing a report here.
Remember Don't let them get away with it! Make sure they make the Rip-off Report .. The more Reports filed on a Company or individual, the more likely it is that the authorities, media and attorneys will want to take action.
And good luck Let us know how you do!
ED Magedson Founder, Rip-off Report.com & Author of www.ripoffrevenge.com
[email protected]
badbusinessbureau.com
www.ripoffreport.com
Don't let them get away with it.
Make sure they make the Rip-off Report!
We are not lawyers.
We are not a collection agency.
We are Consumer Advocates.
...the victims' advocate
WE are Civil and Human Rights Activists
We are a Worldwide Consumer Reporting News Agency
...by consumers, for consumers
CLICK HERE to read about Credit Card Scams... find out how to get your money back. *Rip-off Report Investigation provides valuable information.
Click here to read other Rip Off Reports on PayPal
