Consumer complaint received 2023-01-13
Product: Money transfer, virtual currency, or money service — Mobile or digital wallet
Issue: Fraud or scam — 
Company: Paypal Holdings, Inc (CA)

Was purchasing items from a website that had PayPal payment option. I used the PayPal option to add an additional layer of security/protection to my purchase since I did not know the merchant and had never conducted business with them. When I clicked on the PayPal button within the merchants website to pay for my items which totaled {$130.00}, the merchants website directed me to PayPal to continue the purchase, nothing out of the ordinary there. However, when I clicked " confirm payment '' to finalize my payment through PayPal, the PayPal system did not automatically redirect me to the merchant/seller to finalize the transaction within their website, that's when I realized something was wrong. I immediately tried to reach out to the merchant via PayPal messenger and received a notice that I was unable to message the seller ( XXXX XXXX ). I then reached out to PayPal to dispute the transaction as " unauthorized '' since the seller/merchant failed to perform their duties regarding the transaction by providing the final order confirmation and or order details for my purchases. When I filed my dispute with PayPal, it was immediately denied as an " unauthorized transaction '' because it was labelled within PayPal 's system as a " personal '' ( friends/family ) payment transaction. I protested and provided very detailed information regarding the fact that this was not a personal transaction and was in-fact started via the merchant/seller from their website. In addition, I pointed out to PayPal, that based on the mere fact that the " seller '' business account breached their most recent 'User Agreement ' terms dated XX/XX/XXXX, that was indication that something was wrong with the sellers PayPal account set up and or PayPal XXXX system. According to PayPal 's most current user agreement, business accounts ( such as the seller 's XXXX XXXX account ) are not permitted to receive " personal '' payments using their seller account profile. In addition, I pointed out that the seller 's account was able change the type of type of transaction I was making from a business transaction to a personal transaction within PayPal 's system. PayPal has failed to provide updates on how this user was able to bypass the site security protocols requiring merchants to provide an invoice with a tangible goods purchase as well as an order number or accept a payment as a " personal '' payment using a business account. PayPal continues to use the excuse of a " personal transaction '' to say there is nothing they could do about it except reach out to the seller ( XXXX XXXX ) and advise me to contact my financial institution for a refund. Since my interaction with PayPal and the merchant on XX/XX/XXXX, the merchant has removed their entire shopping site ( XXXX XXXX XXXXXXXX ) from the internet, which was pointed out to PayPal on XX/XX/XXXX XXXX this is further evidence of a " fraud/scam '' in which PayPal allowed by not having the proper security measures in place for online business transactions. PayPal business model is that they " leverage technology to make financial services and commerce more convenient, affordable, and secure ''. They failed at performing the most important aspect of this model and that was security of my transaction within their platform while interacting with a online business. Honestly I believe the latest changes they made to their platform allowed this " bait & switch '' scam site to operate successfully without notice. I requested that PayPal perform a IT Systems root cause investigation / forensic analysis of my transaction to understand how their system failed as I believe there is something wrong with their algorithm/programming that allowed this. I have been using PayPal for more than a decade and have never seen this level of system failure nor complacency regarding something so serious as a breach of their security protocols taken so lightly and it truly concerns me that they are seemingly okay with exposing consumers to this level of fraud.