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Can paypal be ripped off?

I’ve been using ebay / paypal for years for business and I’m savvy enough to attach my paypal account to a second account that I only transfer funds to when I’ve bought something on ebay.

Recently I closed all my bank accounts and have been using my gf’s debit card to pay for ebay purchases tho I have never changed my paypal bank accounts to reflect the changes so I’m still verified and my dead bank account is still my default payment method. Last week I used an Ipod ebay app for the first time to pay an auction and it didn’t give me a payment method during checkout – it used the default, dead account. I assumed when paypal couldn’t take $43 from my closed account, it would use my gf’s card as a backup. It didn’t. I logged in today to pay for another auction and my account was -$43!!!!

So it popped in my head -> what if that had been $5,000? $10,000? $100,000? Not that I think a person could do that and disappear without ever paying it back BUT it would be like giving yourself a low interest loan with flexible payment terms – you’d have a civil judgment against you, no doubt but as long as there were no property to confiscate or paycheck to garnish civilly, a person could take as long as possible to pay them back.

You may even be able to arbitrate to settle your debt down! Imagine buying a house on ebay, paying for it via paypal with no money, putting the house in someone else’s name so you have no asset to forfeit when they take you to court and repaying paypal the debt at your leisure for pennies on the dollar?!? I don’t think you’d even be breaking any laws!

I’m not going to be doing this and if I were I certainly wouldn’t be sharing the idea with strangers – my question is have you ever heard of this? Say someone making one big score off paypal’s back? They certainly stick it to enough regular people, including me once long ago via an unethical customer and a chargeback. Thanks!

Posted: July 18, 2013 at 6:33 pm

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