PayPal has been my best friend for years when it comes to accepting payments for my paintings and photographs. It is convenient and easy. I don't even mind paying for the use of PayPal.
When the PayPal debit card came along I gladly accepted it. After all my PayPal experience up to that point had been awesome! Within weeks of receiving my PayPal debit card it was compromised. That was back in 2005. Because the charges were pending Paypal immediately credited the amounts back to my PayPal account. They cancelled my card and sent out a new one right away.
A few months later it happened again! Once again PayPal corrected the problem , cancelled my card and a new one was on the way.
At this point I should mention that the only place I have ever used my PayPal debit card was as the credit card on file with Etsy. So that narrows down the places where someone could have been accessing my debit card info. Hmmmmmmmm........
Then last Tuesday I check my PayPal account and there it is again! someone has charged items on my Debit card again. PayPal security immediately cancelled the card for me, told me a new card would be issued and mailed to me, gave me instructions on how to file a dispute to get my money back. Great, I followed all of their instructions to a T. Only PayPal never responded. Another call to PayPal security. Now I am told that it will take PayPal 10 to 15 days for PayPal to even look at my dispute. Once they do it can take 45 to 90 days for a decision to be made whether or not my money should be returned to me.
I have cancelled my new PayPal Debit card. I have removed all funds from my PayPal account. From now on money deposited into my PayPal account will be moved immediately to a bank account. I plan to look into other online payment forms including Google checkout and Amazon.
My advice to you......check your PayPal account daily. Don't keep more than $5.00 at a time in it.
Update 08/11/2009
it has been over 8 hours since I called PayPal re: their lack of response to the fraudulent charges to my debit card. I just received an email from PayPal telling me that the amount charged has been credited back to my PayPal account. Was this quick refund due to this blog? Was it because I cancelled my debit card? Who knows. I still plan to move money from any sale of my work to a bank account as soon as it goes into my PayPal account.