Forum

Paypal CAN take money out of your bank account
 

I have just discovered that Paypal have tried to WITHDRAW money from my bank account.

As you know we all have to complete the direct debit mandate when we sign up for Paypal as part of confirming the Bank Account that what put on file with them.

Part of this confirmation involves completing a direct debit form.

Anyway I removed my bank account so it was NOT EVEN on file with them. The Paypal account fell into a negative balance, and they sent me emails asking me to add funds, which I ignored. They limited my account so I figured they could wait for their money.

Anyway got this email today:

Dear Mr *****

On , we attempted to transfer from your bank account, ending in . This transfer was returned by your bank on for the reason below:

There was a bank processing error.

As a result, this bank account has been removed from your PayPal account. Please contact your bank for more information or add a new bank account. Please do not contact PayPal because this is entirely an issue between the account holder and their bank.

Yours sincerely,

PayPal

N.B I had already removed the account and then cancelled the account. If I had not cancelled it then I assume that they would have debited funds.

The other email I got from the prior to this was:

Dear Mr ******

The mandate from your bank account, ending in 7686, was returned by your bank on 26 Nov 2009 for the reason below:

The bank is disputing the Direct Debit Instruction (DDI).

So they tried unsuccessfully to remove funds.

The moral to the story is 1 Paypal account, 1 Bank Account. If you lose the Paypal account, cancel the bank account.

This is my first experience that they try to remove funds without your authorisation, but then when you think about it I guess that is the whole point of the direct debit.

:boink: paypals reach in just what they will do gives me the creeps!

I know when I transfer to bank from paypal, as soon as it hits I move it into an account not tied to paypal in any way. Of course this doesnt protect me from like what they attempted to do with you.

This is the first time that this has happened to me. I have another bank account that I was going to keep. (I removed it from Paypal) but after this I think it is important to stay disciplined and "have 1 bank account for 1 Paypal account"

It is easy to get attached to a bank account though. They take time to set up and to cancel them if you think you can use them again is a cop out.

But again, not worth the risk. Paypals claws get longer and longer.

paypal has always had the ability to 'touch' a bank account if one is attached to a paypal account. Part of the horror is that they do it without advising a user. When I used paypal australia they did that x4 times to bank accounts. After that I completely changed approach to my funds.:ranger:

Users must watch what is happening with funds when a bank account is operative and there are problems.:fight:

Did it twice to me and it was very fast.... buyer dispute initiated, account went into negative balance and funds were gone from my bank account before I even had chance to work out what the deal was.

Cancelling the DD instruction is sufficient to prevent any further dipping if you don't want to close the bank account and the PP account is lost.

CaptainJack

did you just remove ur account from PP or did you cacnel ur bank account?

or did u do both?

Following my initial post. I could have been a bit hasty. When I got those emails from Paypal I ASSUMED that they HAD tried to access and withdraw funds from my bank account.

However on replection it could simply have been that as I either cancelled the bank account or removed the Direct Debit Instruction then it was a notification to that effect.

I believe they CANNOT just withdraw money without your APPROVAL despite regular updates to their user agreement.

Still the way I feel is that I would rather cancel a bank account than run the risk of any chance of funds being debited somewhere down the line.

Doesn't the direct debit agreement state that they can withdraw from your account?

Isn't that the whole point in agreeing to the direct debit mandate?

Yes if the DD mandate is in place PP are able to take funds from your bank account as they see fit (though of course you have the right to dispute it with your bank under the DD guarantee if you feel they have taken funds unjustly).

As soon as you cancel the DD with your bank they will no longer be able to take money from you. And Paypal do indeed send out an email notifying you that the DD instruction has been cancelled.

CaptainJack

CaptainJack

Ive aways known dd mandate allows them to do this, but some paypals HAVE to have bank attached eg. UK
So, GB - whats your new approach then?

Dispute the withdrawal with your bank stating you did not give them permission to make the withdrawal. They will mail you an avidavit, and you sign it and send it back. You'll get your money back. If you closed the account, this wouldn't have happened.

good in theory, but you did give permission under their terms, do you know anyone who has successfully done this?

Removing DD Mandate
 

Some banks allow you to remove the DD on online banking, and some it does not appear.

Under those same terms, you revoke the permission when you remove the bank account.

Yes, I have successfully done this. Most banks have three options to dispute and ACH withdrawal.

1. You never gave permission
2. You gave permission, but on _____ date you revoked the permission.
3. You gave permission, but for a different amount than what was withdrawn.



This is a standard dispute. You usually have 24 hours to dispute an ACH withdrawal. They will mail you an affidavit, already filled out. You sign it, then you mail it to the bank. You get your money back. It's all perfectly legal.

Might not be too successful in the UK. Banks there have different methods. There's no actual need to go as far as an affidavit IF a user takes charge of their own bank account. :peace:

Yes, every bank is different, but I think all banks will have a way to dispute unauthorized transactions.

The whole thing could have been avoided by closing the account. :typing:

^^^^^DING DING DING DING^^^^^

From my own experiences not even closing the account BUT removing paypal access to the bank account.

Agree 1000% with you First, by controlling what happens the user wins .If you have read earlier posts of mine I have always recommended taking charge of your own money. Simples:peace:

so i should do 2 things right

1)remove my bank account on paypal
2)call my bank and tell them to cancel my direct debit from paypal

if i have done the above 2 things, i could choose not to close my bank account right?

thank u so much

yes that is correct :)

CaptainJack

Both Barclays and Abbey accounts in the UK (both work with PP) have the option to remove a DD online.

If you remove your bank account how will you withdraw your balance left in your Paypal account when it frees up in six months? They allow withdrawal to the bank account on file.

In paypal there is a place where you authorize of REMOVE FUNDING SOURCES. The default is allowing them to withdraw from your bank. You can go in and remove your bank account as a funding source. Leaving just something like a Simon Card as your only funding source.