PayPal Has to Pay $25 Million for Being Sketchy as Hell

[madokie]

PayPal Has to Pay $25 Million for Being Sketchy as Hell


After the Consumer Financial Protection Bureau filed a complaint against PayPal today, the company quickly agreed to refund $15 million to customers it ripped off over the past few years.

PayPal will also pay an extra $10 million in fines to the CFPB, so the total settlement is $25 million. The CFPB accused PayPal of all sorts of schemes, so many that it kinda sounds like PayPal is run by my Grandpa Hirtz in his 1980s casino-boat drinking days rather than business professionals.

The almost impressively illegal scams that PayPal’s now paying for include:

Advertising deferred-interest promotions, but then flat-out giving customers the wrong information when they asked about them, or just never answering the customer service line
Charging customers with the interest they were unable to defer due to receiving the wrong information and/or never being able to speak to a representative about the deferred- interest promotion
Automatically signing people up for credit accounts without asking permission
Setting these credit accounts as the default for purchasing, which led to people getting hit with late fees and interest fees on accounts they didn’t know existed
Lying about $5 and $10 credit promotions and then never fulfilling them (total Grandpa move)
Not bothering to remove late fees even after people paid them
Taking weeks to process payments
Not bothering resolving customer disputes

It’s telling that the company ponied up the money within a day of the complaint.

http://gizmodo.com/paypal-has-to-pay-25-million-for-being-sketchy-as-hell-1705630163

[PoliticAverse]

1. Note that Paypal is currently owned by ebay (although they are becoming separate companies soon). nt

[madokie]

2. I use both paypal and ebay

and so far I don't have a problem. of course I have a bank account set up for paypal only and never keep any more than a few bucks in it at one time and transfer money to it when I want to purchase something and pay for it as soon as I hit the buy it now or I win a bid. Very seldom do I bid on something though but I have and I've made some good buys that way, 'specially when some idiot lists something I'm wanting at 2 am and no one is bidding on it and no one is up but me waiting for the last few seconds to place my bid. I'm serious I've bought some things for pennies on the dollar that way.

[Moliere]

5. This is why they paid

They don't want anything standing in the way of completing the spinout and the money is a rounding error in this deal.

[rpannier]

3. Never Trusted It. Never Used It

I'd rather send cash in through the mail if those were my only two choices

[Sherman A1]

4. Excellent!

They operated badly and should reimburse those affected.

[Ford_Prefect]

6. Sounds like they got their business plan from the Time-Share industry.

Same bait and switch, same we're not here on the phone, same fees for nothing services, same denial that anything could be wrong with the system. Too bad the Time-Share crowd can still sell empty space that doesn't exist and is legally protected from fessing up.

[BlueEye]

7. Glad to see the CFPB is engaged in enforcement with PayPal.

Back when PayPal was formed, they went through a bunch of regulatory loopholes so that they would not be viewed as or regulated as a bank, given all the regulatory schemes associated with that. As are result, they have been away to pull a lot of bullshit on people that other banks would *theoretically* be subjected to greater scrutiny for.