Consumer complaint received 2026-02-09 00:00:00
Product: Debt collection — Credit card debt
Issue: Attempts to collect debt not owed — Debt is not yours
Company: Paypal Holdings, Inc
State: FL

Complaint narrative:
I will attempt to explain this situation but it is complex but here is brief summary : This dispute is regarding XXXX XXXX financial apparently doing a series of issuer-initiated chargebacks for purchases made by one of my customers, and these occurred AFTER XXXX XXXX closed the customer 's credit card accounts due to their risk assessment. The customer at that time had not purchased from me for about 1 month, and the customer subsequently fell into financial distress and was unable to pay back his credit cards, which is why I suspect they closed his accounts. However, one month after they closed his accounts, they began creating chargebacks which nearly equaled the exact amount of debt that the customer owed to XXXX XXXX at the time of his accounts being closed. The customer had already run many transactions over a span of several years without any problems, but once he was unable to pay his debts the bank suddenly reversed enough of the charges to bring the customer 's debt down from over {$70000.00} to something in the thousands. It was also notable that XXXX XXXX did NOT reverse any of the other charges by the customer, but only those which were enough to eliminate the customer 's debt. As a result of this, PayPal was forced to pay to the customer 's bank the amount equal to the chargebacks, and now PayPal is seeking to collect the difference from me. In total, XXXX XXXX has reversed over $ XXXX in valid customer purchases, which has transferred the debts of their customer to me. Therefore, I am seeking to have the charges honored by XXXX XXXX and for them to reimburse PayPal accordingly. 

Details : I am a merchant who runs transactions primarily through PayPal. I have two PayPal accounts, one that is owned by me personally but is used for business purposes, and one that is owned by one of my LLCs. For my personal PayPal account, I ran many charges for a customer name XXXX XXXX I have also conducted extensive business in collaboration with XXXX XXXX as well. XXXX XXXX has never accused me of wrongdoing and any disputes we may have had he would have contacted me directly. Moreover, XXXX XXXX contacted PayPal immediately after he saw that they reported that he had disputed a charge, which he told them he had not. However, PayPal told him and also me separately that XXXX XXXX could not resolve the matter with PayPal but rather he had to do so with XXXX XXXX since the chargebacks were initiated there. XXXX XXXX has repeatedly told me that he did not initiate the chargebacks. 

XXXX XXXX and I called XXXX XXXX in XXXX of XXXX. For the first call, I listened in to the call while XXXX XXXX spoke to his bank. During his conversation with XXXX XXXX, he inquired about the chargebacks that were reported to both of us separately from PayPal. However, XXXX XXXX denied that any disputes or chargebacks existed and that XXXX XXXX could not therefore correct anything. However, they refused to send an email stating this. Instead, XXXX XXXX sent me his credit card statements which showed that all of the charges in question were still on his credit card 's online activity portal and there was nothing at all anywhere on the XXXX XXXX website or his activity statements that indicated that he had any disputed charges. XXXX XXXX also reported that he did not have any emails stating that any chargebacks were issued for his accounts. 

In early XXXX, XXXX XXXX and I called XXXX XXXX again to inquire on the chargebacks after I had extensive dialogue with PayPal where I submitted documentation showing that I had fully delivered on the products purchased by XXXX XXXX and also proof that he had emailed and called PayPal to try to resolve the matter. However, PayPal insisted that XXXX XXXX had given them chargebacks totaling over {$70000.00} for XXXX XXXX 's purchases. So XXXX XXXX called in to XXXX XXXX with me on the phone with him, and they spoke to both of us and once again we were told that after extensive searching they could not find any chargebacks pending or otherwise for XXXX XXXX 's credit cards at all, for anything including the purchases he made from me. We asked many times if there was someone else to speak with so that we could resolve the matter and the charges be placed back onto XXXX XXXX 's accounts as he was intent to make arrangements with XXXX XXXX to pay off the balances he owed. However they gave us no means to address the issue since they said they had no disputes on file for XXXX XXXX. 

Finally, in XXXX of XXXX, I called XXXX XXXX to ask him to check to see if he had received any reversals of charges, and they did show up by late XXXX of XXXX. At this point XXXX XXXX and I jointly called XXXX XXXX again and attempt to fix the problem by having the charges applied back to his account, but XXXX  XXXX told us they couldn't do anything because his account had been closed and they considered the matter resolved. This of course is unacceptable because they blocked any chance to address the chargebacks until after they declared them to be permanent. We also inquired as to how these chargebacks were initiated since XXXX XXXX declared that he had not, but the bank told us that they have NO INFORMATION to share about why these chargebacks occurred. We escalated the call as far as we could got but they repeatedly denied any possible recourse for the matter. 

I firmly believe that XXXX XXXX chose to mitigate its potential for loss from XXXX XXXX 's debt by initiating chargebacks against me in order to pass XXXX XXXX 's debt to me. This seems clear since at all times XXXX XXXX denied any chargebacks existed, they refused to send any written statements reflecting this declaration, and once the chargebacks finally were reversed they refused to disclose any information as to who initiated the chargebacks or allow any means for the customer, XXXX XXXX, to assert that the charges were correct. Despite the customer 's cooperation and assistance to help me in this matter, he is unable to pay me directly to compensate, thus leaving me to imminent collections and damage to my strong credit rating, as well as my reputation as a business owner. 

XXXX XXXX has provided me with copies of his account statements from before the charges were reversed and after. Please note that after the XXXX statements, another {$27000.00} in charges were still pending but now {$14000.00} remains in dispute, but PayPal is asking me for the entire amount since they are expecting XXXX XXXX to reverse the last {$14000.00} as well. This means that XXXX XXXX 's accounts are now nearly at no substantial balance, which once again shows that XXXX XXXX reversed the charges so as to avoid the liability of XXXX XXXX 's debts being absorbed by the bank.

Company response to consumer: Closed with explanation