I want to start this post off by saying that I am wrong, the issue of not having myself protected is my fault.  What I do want to state though is that PayPal should make this issue that I had more apparent to its customers that receive payments for a product valued over $250.

On July 31st ActiveTuning received an order for an RGB2+ for $325 shipped.  This is not a product that we normally stock (we state this on the product page, and also state that it will take about a week before it’s shipped to the customer), so once an order arrives, we place an order with our supplier, who then ships it to us, and we ship it to the customer.  We shipped a few days later, within PayPal’s 7 day terms.

Almost 3 months later, on November 28th, I received a notice that the funds were on hold due to a chargeback.  PayPal asked for the tracking #, in which I gave to them right that day.  The tracking # confirmed delivery of the unit to the customer.  Two weeks later on December 12th, I receive an e-mail from PayPal stating that the funds cannot be returned, the customer won the chargeback settlement, sorry….and I’m responsible for the $10 chargeback fee.  From my perspective as the business I did everything correct.  I received an order and I shipped as soon as possible.  I used USPS Priority Mail, as PayPal heavily promotes and integrates into their service.  This was not fair to me.

I immediately called PayPal, and after looking into it, they directed me to the third bullet of section 11.7 of their twenty five page user agreement.  Under the definiteion of “proof of delivery” it states the following:

Signature Confirmation for transactions that total $ 250 USD or more (see Foreign Currency Equivalents below).

While I did get delivery confirmation on the package, I did not get signature confirmation.  Since I did not get this, I automatically lose the chargeback case.  Yes, this is in the 25 page user agreement, but sorry PayPal, I can’t memorize or read every single thing.  This is a pretty important aspect of seller protection in my opinion, especially on higher priced items (anything over $250).  Would it be that difficult to “promote” this term/clause a little better to protect their own customers (the sellers that generate a huge amount of sales in which they make money through transaction fees and monthly service agreements)?  A simple obvious note when receiving a payment over $250 for a good that says “hey, don’t forget to add signature confirmation so you don’t get fucked when your customer scams on you”.

That is all.