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PayPal to Roll Out Buyer Vetting Service

In a move designed to attract more online sellers to accept its virtual payment service, PayPal this year plans to roll out a voluntary service designed to warn merchants if a transaction presents a fraud risk.

Merchants who adopt PayPal's "payment review" service -- to debut in beta form this summer -- would be alerted if a certain transaction raises red flags. PayPal then would ask the seller to delay shipping the item while PayPal reviews the case. If PayPal ultimately deems the transaction to be safe, sellers would be covered 100 percent for any fraud that should stem from the transaction. The service would be available to all merchants who accept PayPal, not just eBay sellers.

In an interview last Thursday, PayPal Chief Information Security Officer Michael Barrett said the verification process will be a speedy one. "We believe it's safe enough so that if anything does go wrong with it later, we're not going to hold the seller's feet to the fire."

Barrett said PayPal soon may decide to expand the rollout of its "security key," a small key fob that every 30 seconds or so generates a random, new six-digit passcode, which users are required to enter in addition to their user name and password. PayPal currently sells the optional tokens for $5 each, but Barrett said the company is strongly considering giving them to people whose accounts have been hijacked.

Update, 3:25 p.m. ET: An earlier version of this blog post incorrectly stated that the PayPal security keys are free to business account customers. That is no longer the case: Late last week, eBay began charging all customers a $5 fee for the tokens.

By Brian Krebs  |  June 18, 2007; 1:55 PM ET
Categories:  Fraud  
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Comments

I have a question, regarding Paypal. For two minths in a row I have been charged for Gamehosting by my credit card through paypal. As far as i know I did not do any such thing. It is billed from a numbered account in Great Britain. I contacted paypal last month and they were going to send me an afadavit which never arrived and the card company wants them to try and figure it out first.

Well this month on my bill I was charged again when I thought that paypal was going to red flag the account.

What questions should I be asking as whatever I said last month does not seem to have worked.

Posted by: James Mittlefehldt | June 20, 2007 4:41 PM | Report abuse

Visit http://paypalsucks.com/forums/ if want to see how PayPal routinely treats sellers.

Posted by: Lily | June 21, 2007 12:59 PM | Report abuse

As this blog post suggests, PayPal is constantly innovating to provide the most secure and trustworthy payments service available online. If you're experiencing account specific issues, we encourage you to contact our customer service department at 1-402-935-2050 and one of our representatives will be happy to help address your concerns. Alternatively you can correspond with us by email. Simply visit the "Contact Us" link that is located at the bottom of every PayPal page.

Sincerely,
PayPal Operations Team

Posted by: PayPal Operations Team | July 2, 2007 3:18 PM | Report abuse

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