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PayPal issue involving a collection agency

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I4AT

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A while ago I sold a video card to some shady kid on Hardforum against my better judgement. Basically what happened was PayPal put a hold on the money a few days later, they wouldn't tell me why, and I provided them with a tracking number for the package.

Some time passed and they reversed the payment back to the buyer (it wasn't a chargeback though, they just up and reversed it). So my account has had a negative balance since I withdrew the money right away.

I just now started getting mail from a collection agency regarding this issue, I've only received one letter so far.

Everything on my end I held up to. The package was shipped, the buyer received it, there was never a chargeback. I suspect it may have had something to do with illegit funds, stolen credit card maybe? But I'll never know, because PayPal wouldn't tell me why they put the hold on the payment.

As far as I'm concerned if PayPal decided to put the payment through without doing any sort of check for legitimacy, why should I be responsible for their loss? I don't intend to pay them anything, so do I just ignore it or try to dispute it somehow?

I have no credit, never owned a credit card or anything like that, so should I worry about this being damaging in any way?
 
If you shipped it to a verified address; then you should dispute the charges - you followed paypal procedures properly.

If you shipped to another address, then you are stuck.
If you shipped it US Mail with any type of signature, then the Postal Inspectors could help you.
 
Typically I just use the PayPal shipping system to print out a label, that wasn't an option with this payment as I guess he sent it with the no shipping address required option or something?

So I just used a different payment I had in my history to print the label, no type of signature confirmation or anything, just delivery conf. Guess I just tough it out then?
 
Send a certified letter asking for validation of the debt with the collection agency within 30 of receiving the letter. What this does is forces the collection agency to send you all documents they have pertaining to this debt. If they do not send this information to you within 30 days, the debt is absolved. If they try to collect on this debt during this time period (this includes making phone calls, sending letters or selling the debt to another agency), they are in violation of the FDCPA and it is a $1000 fine per offense.
 
Also, is Paypal still using NCO Financial as their collection agency? If that's the case, they'll fold up after you send the letter.
 
Originally posted by: DayLaPaul
Send a certified letter asking for validation of the debt with the collection agency within 30 of receiving the letter. What this does is forces the collection agency to send you all documents they have pertaining to this debt. If they do not send this information to you within 30 days, the debt is absolved. If they try to collect on this debt during this time period (this includes making phone calls, sending letters or selling the debt to another agency), they are in violation of the FDCPA and it is a $1000 fine per offense.
Click to expand...

I suppose I could try that, is this just a hand written letter saying I'd like validation, or is there a form I need to fill out?
 
Handwritten or typed doesn't matter. Just make sure you make a copy of it, send it certified and mention the magic word "validation." If you want just google validation letter and cut and paste it to fit your situation.

Also, if the strength of their documentation is weak, threaten to take them to small claims court. If the validation letter didn't scare them off, this threat most likely will. Nobody wants to fly cross country to fight some rinky dink small claims case on the weight of some flimsy evidence.
 
Originally posted by: DayLaPaul
Handwritten or typed doesn't matter. Just make sure you make a copy of it, send it certified and mention the magic word "validation." If you want just google validation letter and cut and paste it to fit your situation.

Also, if the strength of their documentation is weak, threaten to take them to small claims court. If the validation letter didn't scare them off, this threat most likely will. Nobody wants to fly cross country to fight some rinky dink small claims case on the weight of some flimsy evidence.
Click to expand...

Ok thanks, I'll look into it.
 
Originally posted by: I4AT
Typically I just use the PayPal shipping system to print out a label, that wasn't an option with this payment as I guess he sent it with the no shipping address required option or something?

So I just used a different payment I had in my history to print the label, no type of signature confirmation or anything, just delivery conf. Guess I just tough it out then?
Click to expand...
Do the debt validation routine as described here.
Often the required paperwork never comes along with the case, or does months after the fact.
Either way, if they can't produce the original agreement or other supporting documents, they lose the rigfht to collect as well as report the collection.



 
Can you do the debt validation thing even it it is after the initial 30 day period the creditor must give you to respond?
 
A long time ago, the same thing happened to me, I ended up with a neg balance and refused to pay them back because it wasn't my fault... got sent to collections. I ignored the letters and every few months or so I would get a new one and every time the letter would say something along the lines of "we'll settle this if you pay us back 75% of it" and they would decrease by 25% after each letter. I was not about to pay a single dime for paypals incompetence so after I ignored the "pay us back 25% and we'll drop it" letter, they just stopped coming for obvious reasons. Surprisingly, none of this showed up in my credit reports so I didn't take a hit at all from it other than losing the paypal account which is actually a blessing in disguise. Again that was a long time ago, not sure how things work now.


edit: My neg balance was around $550 dollars and it was a series of chargebacks from the same buyer 2 months after I sold stuff to him.
 
Originally posted by: DayLaPaul
Send a certified letter asking for validation of the debt with the collection agency within 30 of receiving the letter. What this does is forces the collection agency to send you all documents they have pertaining to this debt. If they do not send this information to you within 30 days, the debt is absolved. If they try to collect on this debt during this time period (this includes making phone calls, sending letters or selling the debt to another agency), they are in violation of the FDCPA and it is a $1000 fine per offense.
Click to expand...

The best way to handle this.
 
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