Consumer complaint received 2020-09-10
Product: Money transfer, virtual currency, or money service — Mobile or digital wallet
Issue: Unexpected or other fees — 
Company: Paypal Holdings, Inc (MA)

An international client ( XXXXbased ) sent me payment through PayPal for consulting services rendered. PayPal reported to me it was " holding '' the incoming payment for 21 days for fraud-prevention purposes, at which time I noticed my client made a mistake with the amount of the payment sent. 

When I asked PayPal to refund the pending amount because of the mistake, their delayed-response chat-based customer service ( it is impossible to reach a real person ) gave me several different answers on how to do so over the course of two days. They finally confirmed over chat ( after 3 incorrect/different answers ) they would refund the full amount given the payment was still pending. 

Nevertheless, when my client received the refund, PayPal had taken out two currency exchange percentage margins ( one unfavorable to USD, and one back to GBP ) for the same transaction, even though I never had received the funds, and the funds were processed as a full refund of the same transaction. They only refunded their " credit card transaction fee '', and you'll see that in both receipts from the payment and the refund the fees from the currency exchange margin PayPal takes are not disclosed at any point. 

PayPal claimed that the fees come from " constantly-changing exchange rates '' when in reality the amount my client lost derives from their currency exchange margin, effectively charging twice for refunding a transaction that was never paid in the first place.

I am complaining for three reasons : 1 ) PayPal did not honor their word on this transaction. Their agents told me, on multiple occasions, through chat, that the full amount of the transfer would be paid back to my client. When I processed the refund of the held funds through PayPal 's website, there was no mention of what the exchange rate back to the client would be, so it only showed the USD amount to be transferred back instead of both the USD and GBP amounts ( which I assumed through my conversations with their customer service agents would be transferred back at the current rate along with the fee they took out for exchange ).

They then returned nearly 4.5 % less and told me that shifting exchange rates were to blame ( when in the interim period the USD strengthened against the GBP each day ), when in reality it was their " margin '' fee. 

2 ) PayPal charges currency exchange margins above the rate in both directions of the transfer, which means that even if a payment is fraudulent, mistaken, or in my case not made, they will claim two commissions on each returned transfer, even though at no time did the funds leave their custody. This is unfair and very unclear in their terms and conditions ( which, upon research, have changed more than three times in the past 12 months on this exact subject ).

3 ) PayPal 's customer service is so deficient that it is impossible to get a direct and timely answer from them on very important transaction issues. The phone number they provide always directs you back to online chat, and agents told me on numerous occasions they would call me but never did. It has taken me nearly five days of back-and-forth chat, with