21 DAY HOLD FINANCIAL SERVICE OMBUDSMAN WANTS TO HEAR FROM YOU

[hmmar-spier]

Having lodged a complaint against Pay Pal and Ebay in regards to illegally freezing funds and also referring the matter to the privacy commisioner.  The Financial Services Ombudsman also wants to hear about accounts where funds have been placed under the 21 day hold. Their office is anticipating an across board deluge of complaints and they wish to be advised of individual cases as believe this is a breach of law.

[tall_bearded01]

EBay cannot wipe its hands.

The difference between PayPal Buyer Protection (PBP) and the eBay Money Back Guarantee (MBG) is that PBP is limited two where the buyer can establish a right of recovery against the seller, whereas the MBG underwrites the buyers’ risk inherent with buying something on line.

If a person lodges an item not received claim with PayPal, then a buyers right to a refund is restricted by the deemed delivery provisions of the Sales of Goods Act.  That is if the seller can prove postage, deemed delivery usually applies, and if deemed delivery does apply, the buyer has no right of recovery against the seller and therefore no entitlement to a fund vide PayPal.  This is the reason why PBP carries the caveat, “though you may not receive the item, you are not necessarily entitled to a refund.

On the other hand, if the item is not received, the MBG guarantees a refund irrespective of whether there is a right of recovery against the seller.  That is, it appears to be a policy of insurance, which in itself raises a few issues, especially if they are not a licenced insurance provider in Australia: but that is a wholly different topic, but one that I intend to purse with the relevant regulatory body and the Insurance Council of Australia if they are stupid enough to freeze the finds in an old selling account I just began listing on, with the 1st auctions due to finish in about 3 days’ time.

[cq_tech]

tall_bearded01's response was somewhat more verbose than mine would have been, but no less accurate. Essentially eBay have promised to refund the buyer's money regardless of its source, and the same will apply once eBay and Paypal become totally separate entities anyway. Besides, I'm fairly sure the FOS will see that eBay ultimately do the right thing regardless.

[lyndal1838]

So what you are saying TB is that if the seller is using Paymate or Merchant CC Facility and the buyer wins the dispute then ebay has to foot the bill as they have no right of recovery against the seller?

Sounds good to me but I would still think twice before using Paymate again as a buyer.

[cq_tech]

How else could it be, Lyndal? If eBay are silly enough to offer a MBG, they have to pay up regardless.

[tall_bearded01]

It is the eBay Money Back Guarantee, not the Sellers Money Back Guarantee.  That is, it is eBay who is underwriting the risk, not the seller.

Therefore the process is simple.  Item not received.  The issue cannot be resolved with the seller, so the buyer asks eBay to intervene.  At this point EBay must make a decision as to whether (or not) the item was actually received.  If the answer is no, then eBay must reimburse the Buyer irrespective of whether they have a right to recover the cost of the buyers claim from the seller. 

That is the fundamental deference between the Guarantee and Buyer Protection is, when it comes to the Guarantee, the buy is guaranteed a refund irrespective of whether a right of recovery against the seller exists, whereas under PayPal Buyer Protection, if no right to recovery exists, any refund is at PayPal’s discretion.

This then raise the question, when does eBay have a right of recovery against the seller, and I think that, in a few months,  once the dust settles, we’ll find that The Guarantee is a policy of insurance, and if eBay wishes to continue to provide it, they will be required to obtain the necessary licences,  and it will be requirement of that licence that all decisions are subject to oversight by the FOS; and once that happens, the document will be revised where proof pf delivery becomes proof of postage.

[aussiebargains_2011]

always good info, thanks

[4green2000]

Beware...BUMP AHEAD..

[i-love-my-sheep]

Bumpy road full of pot holes!

[aussiebargains_2011]

any sucess stories??

[i-love-my-sheep]

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@aussiebargains_2011 wrote:

any sucess stories??

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Yes! My friend tried unsuccessfully to get Paypal to lift the hold on his new account, as he had a long term establised account already that was linked to the same PayPal account. They told him that even though he was an established seller, all new accounts are treated the same way regardless of your own history.

He lodged a complaint with the FOS and 3 days later he got a detailed message from PayPal saying they had released the held funds and exempted him from further holds. He had a sale last week on the new account and the funds weren't held.