Thursday

PayPal Just Ripped You Off

PayPal rips off your rights
PayPal Rips Off Your Rights
If you are like millions of other folks out there, you probably have used PayPal online. The idea is great, but the details just ripped you off today - they stole your legal rights and you probably didn't even know it.

Most business people are honest and hard-working. Some, though, are more interested in getting the money than being honest about it. Honest business people don't steal from their customers and aren't afraid of explaining themselves in Court because they know they didn't do anything wrong. It's the crooks you have to watch out for. They steal your money and look for ways to steal your legal rights too. And even honest businesses can be tempted.

PayPal is clever. You can use it to pay for online shopping at "millions of online stores" without sharing your "financial information" which must mean credit card numbers, passwords, etc, we suppose. You can transfer money to friends too, using PayPal. And they promise to keep your financial info "private and protected." But you pay for that privacy in ways you probably don't realize.

Beginning Nov. 1, 2012 you pay to use PayPal by giving up your legal rights against them. That's right. They make money off you and you can no longer take them to court over anything they might do to you in the process, including an "accidental" stealing of your money with false or erroneous charges or overbilling to your credit card.

Can that kind of problem happen to you? Who knows. But one thing is for sure. You will be at their mercy on trying to fix any problem you may have with them from now on.

But maybe not. If you send PayPal a letter by snailmail (that's right, the old post office way) BEFORE December 1 that says you want to "opt out of the company's agreement to arbitrate and its prohibition on class actions" then you still will have the right to go to court if something bad goes wrong and its PayPal's fault. You can read the whole story here (click here) where Washington Post Consumer Reporter Caroline Mayer has explained what they (and also EBAY) are doing to you.

You see, PayPal and eBay have sent out one of those "updates" to their user agreements, much like the ones you get to your credit cards every once in awhile. These are usually meaningless changes that don't amount to much. And most people don't even bother to read them. And the big business companies count on exactly that - the fact that most folks don't read them.

This time though, they changed the rules of the game. They stuck in a binding arbitration clause that says no matter what they do to you, you can't take them to Court. Gee, if there never had a problem, because they were not doing anything wrong, then why are they suddenly afraid of having to go to Court and explain that they aren't doing anything wrong?

So, you think it's that they pay too much out to their lawyers to fight "frivolous" lawsuits? Ask yourself this: when was the last time you heard of a lawsuit against PayPal? Yeah, right. We're lawyers, and we have never heard of one at all.

What is so bad about binding arbitration, you say? Plenty. It is a private system (no public courtrooms) that is paid for in large part by the businesses that use it (so who do you think they listen to?) that is paid to decide what those businesses should do for you if they did something wrong to you (does the fox guarding the henhouse sound familiar yet?).

PayPal and eBay have joined an ever-growing trend by big business to take away consumer's legal rights in this sneaky fashion. For over 200 years our legal system has protected regular everyday people from being abused by big companies by holding them accountable in a courtroom. Just knowing that a public courtroom is out there can curb the sometimes abusive "get their money first" philosphy that some business people live by.

And what is wrong with stopping class action lawsuits? Plenty there too. When big business rips off fifty cents from a customer, you think it's no big deal? There was a baby food company a few years back that was selling apple juice in baby jars that was just colored sugar water. The closest it got to apples was if you were sitting with your baby under an apple tree when you gave it to them. Fifty cents here and fifty cents there and pretty soon you're talking millions of dollars - and that's what it was. No one would have sued over fifty cents (and you think the baby food company never thought of that?), but a class action brought by one angry mother got their money back.

And then there was the insurance company out in California that actually had a policy of denying every insurance claim that was below a "minor" dollar amount, including completely valid claims, because they had calculated that no one would sue them over it. And no one did until one policy holder found out why his claim was denied and fought them over the principle of it.

Courtrooms and class actions have a role in our society and in our legal system. They protect the little guy from the big guys. Without that protection, greed can run amok when money is more important than morality. And, let's face it, with some people it is.

Most business people are honest and hard-working. Some, though, are more interested in getting the money than being honest about it. Honest business people don't steal from their customers and aren't afraid of explaining themselves in Court because they know they didn't do anything wrong. It's the crooks you have to watch out for. They steal your money and look for ways to steal your legal rights too. And even honest businesses can be tempted.

If you want to learn about about why Arbitration Sucks, take a look at www.ArbitrationSucks.com.

If you want to opt out of PayPal's new "you can't sue us" rules, Caroline suggests (and we agree) you must send the downloadable form created by The Consumerist website to them, postmarked no later than Dec. 1, to: Litigation Dept., 2211 North First St., San Jose, CA 95131 - and be sure to actually sign the letter too or they won't count it. Of course they might say they never received it so be sure that you keep a copy of it for your file. And if you really are concerned, you might want to send the letter by certified mail return receipt requested - so you can prove it later if you have to.

Caroline Mayer's article gives some other good tips on how to protect yourself from losing your rights and you should read those at her online article on the Great PayPal Legal Rights Rip Off by clicking here.

Be careful out there. Protect yourself. Don't let them steal your money. And don't let them steal your rights either.

Burdge Law Office
Helping Consumers Protect Themselves for Over 30 Years