On January 18, a customer registered for an event on our website and paid through PayPal. We confirmed her registration via email. The event is to be held this weekend, Feb. 3-5.
On Sunday, Jan. 29, we received a notice from PayPal telling us the customer did not know who charged her card and that PayPal was opening an investigation.
I immediately responded to PayPal that I had no idea about this and that I would contact the customer right away. As I was typing the email to the customer, within 4 minutes of the PayPal email, I received an email from PayPal saying the investigation was complete and the charges were reversed back to the customer. I completed the email to the customer and also made 5 attempts to contact her by phone. There were no answers from either.
Later that day, I researched PayPal's site to see if I could respond to this and submit the proof of registration and a copy of the registration stating that a cancellation fee of $35 would apply if cancelled prior to 30 days before the event. I found that once the case is closed, there is no means for the merchant to appeal. I then wrote an email to their customer service with the information, hoping they would direct me as to how I can appeal. There was no reply whatsoever.
Last night, Jan. 31, the customer's husband called by phone. He told us he had received the emails and that his wife was out of town but was returning for the weekend event. He said that there must be a problem on PayPal's part and that he would take care of it. One hour later, he called again, saying that his wife was out of town on family business and that she would not make it to the event and would hopefully make an event at another time. He did not want to discuss a cancellation charge.
It is now clear that she (the customer) found that if she used PayPal to reverse the charges, she would not have to pay the cancellation fee with us.
Today, Feb. 1, I called and talked with a PayPal representative. She explained that the reversal was correct, and when asked about our cancellation fee, she said they do not get involved with that. She said that any time a customer does not know who charged their card, they take that very seriously and normally reverse the charges. I asked why I did not get the chance to submit any proof that she registered for this event, and proof that she was coming with a friend, with her name clearly on the email to us. The rep told me that they have closed the case and there was nothing more she could do about it.
The one interesting comment the representative said was, "If the merchant is selling a service, the seller does not have the same guarantee or protection as if they were selling merchandise." I find that very interesting! I understand that selling merchandise normally includes shipping, and proof of shipping is a factor of proof for the merchant. However, this goes far beyond that.
Whether it be proof of shipping or proof of registration including the customer's email, what is the difference? Why was I not allowed to submit the proof?
All I was requesting was the $35 cancellation fee. Now I am out the entire amount. I believe PayPal is wrong in its handling of this transaction, and I have completely lost trust in PayPal.
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