Consumer complaint received 2026-03-06 00:00:00
Product: Money transfer, virtual currency, or money service — Virtual currency
Issue: Fraud or scam — 
Company: Paypal Holdings, Inc
State: FL

Complaint narrative:
This complaint concerns unauthorized electronic fund transfers resulting from identity theft and account takeover of a PayPal digital wallet. See attached evidence packet with exhibits. This complaint concerns unauthorized electronic fund transfers resulting from account takeover. Between XX/XX/XXXX and XX/XX/year>, an attacker took control of my PayPal account by changing the two-factor authentication ( XXXX ) phone number. This allowed the attacker to receive authentication codes and maintain control of the account despite my efforts to secure it. After the takeover, unauthorized cryptocurrency purchases totaling approximately {$13000.00} were executed using funds from my linked bank accounts. Between XX/XX/XXXX and XX/XX/XXXX, multiple cryptocurrency transactions were executed without my authorization. These included a {$3000.00} XXXX purchase on XX/XX/XXXX, a {$4500.00} PayPal USD purchase on XX/XX/XXXX, and several {$1000.00} cryptocurrency purchases on XX/XX/XXXX. The cryptocurrency purchases were immediately transferred out of the account to external wallets controlled by the attacker, which is consistent with account takeover fraud rather than authorized customer activity. During the same period, a new phone number for XXXX and multiple addresses were added to the account without my authorization. I did not make these changes and did not authorize any of the cryptocurrency purchases or transfers. I reported the unauthorized activity to XXXX and my banks within approximately XXXX minutes of the first transaction. During my initial call, I specifically requested that PayPal remove all linked financial accounts from my wallet and block the account from further transactions until the situation was resolved. Instead, PayPal only issued password resets. Because the attacker had already changed the XXXX phone number and maintained control of the account, these password resets were immediately intercepted and the unauthorized activity continued. Despite receiving prompt notice of the account takeover, PayPal did not implement an effective account security restriction until after additional unauthorized transactions had already occurred. As additional fraudulent transactions occurred, I opened multiple fraud disputes and repeatedly escalated my requests for a full account block and removal of linked accounts. Although PayPal representatives stated that a hard block would be placed on the account, PayPal again only issued password resets. It was not until the final fraudulent transaction on XX/XX/year> that I reached a XXXX who successfully applied a hard block and removed the linked financial accounts from the wallet. As a result, multiple fraudulent transactions occurred after PayPal had already been notified of the account takeover but failed to properly secure the account. PayPal later closed the fraud cases and determined that the transactions were authorized but did not provide any investigation details explaining that determination. My bank statements show corresponding debit card withdrawals labeled PAYPAL * CRYPTO totaling thousands of dollars during the same period. I also requested PayPals investigation records, including login activity and device information related to the account takeover, but this information has not been provided. I request that PayPal conduct a proper investigation into the account takeover and unauthorized electronic fund transfers, correct the account balance, and reimburse the resulting losses.

Company response to consumer: Closed with explanation