I am not normally one to put my head above the parapet, but having gone through the lengthy process of challenging paypal on a chargeback this may help some of you.
I sold an item on ebay and as it happens it was new old stock, i thoroughly tested it before advertising it and it sold for a few hundred pounds, 2 weeks later the buyer contacted me claiming it was broken, no problem says i, i have another, please pack it up and i will have it collected at no charge to you and will send a replacement by return. To my suprise no reply for another week then bump, a paypal not as described claim, they snatched the money from my account and proceeded to investigate the claim as only paypal can, so at this point i sent the buyer a recorded delivery letter stating my intention to replace the item and also informed paypal of the same, which of course they ignored. Undetered i bombarded paypal with questions regarding this problem to no avail, i asked for a copy of the so called independant report, no chance they said and hid behind the data protection act.
The paypal machine ground on, and eventually found for the buyer, goodbye money!!
Luckily i had not enough money in the account to cover the charge back so they sent their hounds, (Mr Brown etc who by the way never arrives) I then sent off for my file from paypal as under the data protection act i am entitled to every bit of paperwork they hold concerning me, this yielded some valuable info that they would otherwise not share with me.
I gathered all this up into a nice fat file in date order accompanied by my own evidence, emails recorded delivery letters etc and sent the lot to the financial ombudsman. Make no mistake this is a worthwhile exersize. Only problem with this is it takes months, meanwhile you have the paypal hounds phoning writing and generally hassling you for payment, dont despair, there are two options to shut them up, one is to write to them with the reference from the financial ombudsman telling them you have made a complaint which in my case they chose to ignore, secondly the most powerfull tool of all, write and tell them that you do not wish to be contacted about the debt any more in any way unless it is by county court summons, in other words pee or get of the pot this will stop them dead, as it is against the law to continue to harrass you for the debt once they have received this letter unless it is by official proceedings, the only problem there was that they dont accept recorded delivery letters, so the next time they phone you tell them you are sending payment by recorded delivery in a cheque and bung your nice letter in instead. Might seem a bit underhand but alls fair etc.
All went nice and quiet after that, then i received a phone call from the ombudsman to clear up a few points (ten months later) and as if by magic paypal reinstated my account and refunded me the money, needless to say i got no apology but i won, so dont give up, stay on their case, i made a point of daily emails to paypal just to let them know i wasnt going to roll over.
Here are the points you should try and stick with when fighting them
Keep all correspondance (most important)
Get a copy of any information paypal keep on file about you under the data protection act, ( costs a Tenner, but well worth it for the info that you wouldnt normally get)
Complain to the financial ombudsman.(costs paypal money when you do this as they charge a hefty fee) costs you nothing!
Tell the collection agency you are recording all their calls
Fend of the collection agents by telling them to take you to court or leave you alone, you dont need the stress they will put on you (unconfirmed rumour has it that they never go to court anyway)
If you feel you are right dont give up, too many people do and big companys rely on this in far more cases than we are led to believe, they love the waiting game, and their legal team is employed by them so they are paying them a salary anyway, so jerking the punter around is an occupational hazard that is built in to their profit margins!!
Hope this helps as i have yet to hear of a succesfull claim published on ebay, (perhaps they delete them) soon find out!!