Consumer complaint received 2026-03-09 00:00:00
Product: Money transfer, virtual currency, or money service — Mobile or digital wallet
Issue: Unauthorized transactions or other transaction problem — 
Company: Paypal Holdings, Inc
State: CA

Complaint narrative:
Statement of Problem : On XX/XX/year>, my local development server was compromised by a Remote Access Trojan ( RAT ) malware attack, turning it into a " zombie machine. '' Hackers hijacked my active browser sessions to initiate XXXX unauthorized online purchases totaling over {$3100.00}. PayPal has officially denied my fraud claim ( Claim ID XXXX ) for the XXXX {$1700.00} XXXX XXXX charge. They are relying entirely on a spoofed IP match from my compromised computer to excuse their own catastrophic system failures. I demand that PayPal address the following undeniable facts and provide actual technical proof to this XXXX, rather than automated excuses : XXXX. The " XXXX Bank '' XXXX of XXXX : PayPal claims the transaction was " fully authorized '' because the IP address matched. However, the {$1700.00} XXXX XXXX transaction was forced through a completely closed bank account with a XXXX balance that remained listed on my profile. I demand that PayPal prove to the CFPB, with technical logs, exactly how a dead, closed bank account successfully communicated with their servers to authorize a {$1700.00} purchase. They can not, because this is a fatal flaw XXXX their authorization architecture. XXXX. XXXX XXXX XXXX XXXX XXXX XXXX : During the attack, PayPals security alarms were triggered. At XXXX AM, they sent me an interactive SMS asking to confirm the payment. I immediately replied " XXXX '' and " Security breach. '' PayPal ignored the authorized account owner 's explicit denial and allowed the charge to process anyway, yet their automated SMS replies and web displays deceptively promised they were working on it. XXXX a final written response ( XX/XX/XXXX ), PayPal 's XXXX XXXX explicitly admitted their interactive SMS notifications are merely " informational '' and can not stop a payment. XXXX. Misplaced Trust During an Active Crisis : Because PayPals system deceptively told me the situation was being handled, I relied on their promises. I was XXXX the middle of a massive cyber-crisis, frantically triaging and recovering my compromised local development servers. PayPal 's deceptive assurances crippled my ability to prioritize this financial breach. They robbed me of my " golden window '' to react, as I trusted they were acting as my gatekeeper. XXXX. The XXXX XXXX vs. The Rushed Denial : PayPal claims their system detected nothing wrong, yet I was able to independently recover the accompanying {$1400.00} fraudulent charge directly from XXXX. XXXX 's fraud department recognized the illegitimacy of this exact same hijacked session and refunded the money without PayPal 's help. Meanwhile, PayPal rushed to close my XXXX XXXX dispute XXXX a mere XXXX daysafter the damage was already doneand stubbornly refuses to admit their algorithms failed to catch what another merchant easily verified. Index of Attached Evidence : Please reference the XXXX attached files which conclusively prove the systemic failures outlined above : Exhibit XXXX : XXXX XXXX Receipt : Proves the hackers used an unauthorized XXXX XXXX drop address. It also displays a deceptive " You reported a problem with this transaction '' headline, further contributing to the false sense of security that the issue was actively being handled. Exhibit XXXX : XXXX XXXX XXXX XXXX : XXXX PayPal closed the investigation XXXX just XXXX days. Exhibit XXXX : XXXX XXXX XXXX : Proves a legitimate merchant successfully identified this exact session as fraud. Exhibit XXXX : PayPal XXXX ( XXXX Bank ) : The smoking XXXX proving PayPal forced a transaction through a dead bank account. Exhibit XXXX : PayPal SMS Log : Proves PayPal sent an interactive security alert, received my explicit " No '' and " Security breach '' replies XXXX real-time, but allowed the charge to process anyway. Exhibits XXXX & XXXX : XXXX Bank SMS Logs : Demonstrates how my traditional bank honored my real-time " No '' response to block fraudulent charges on the exact same day. Exhibit XXXX : XXXX Transaction History : Proves these massive electronic purchases were a severe behavioral anomaly. Exhibit XXXX : XXXX XXXX Final Denial ( XX/XX/XXXX ) : PayPal 's official written admission that their security texts are merely " informational. '' Exhibit XXXX : Collections & XXXX Threat ( XX/XX/XXXX ) : PayPal 's written refusal to manually halt automated collection harassment during an active regulatory dispute, explicitly daring me to serve them with a lawsuit. Desired Resolution : PayPal is hiding behind a hijacked IP address to excuse the fact that they ignored the actual account owner, bypassed dead financial instruments, and sent deceptive alerts that sabotaged my emergency response. Furthermore, they are actively weaponizing their collections department against me while refusing to halt automated systems. I request the CFPB compel PayPal to clear the {$1700.00} fraudulent negative balance, reverse the unauthorized charge, and cease all collection threats immediately.

Company response to consumer: Closed with explanation