Using Paypal Without Falling for Paypal Phishing Scams

What is Paypal?

Paypal is an online payment processor and financial services group. In essence, they're an easy way to send and receive money online, including to individuals who normally wouldn't be able to take a bank card or a credit card. In the old days, you could use services like Western Union to 'wire' money to people, even if they didn't have a normal bank account and couldn't cash a paper check. Paypal serves a similar purpose, as anyone with an E-mail address and a mobile phone can open up a free account to send and receive funds.

But Paypal has other services as well, such as billing or money requesting. That means small-time operators that don't have access to credit card machines can still sell things online. This method is appropriate for things like subscription services as well, since the money can be requested on a periodic basis. People using eBay, indie artists, charities, and many others make use of the payment request system. But more and more mainstream companies are accepting payment from Paypal as well.

By hooking the back end of a Paypal account up to credit cards, debit cards, and bank accounts, the money can automatically flow to or from such mainstream financial institutions and credit services with the touch of a button. Or one can keep a Paypal 'balance', where the money of various sorts (US dollars, UK pounds, EU euros, etc.) can 'float' until spent or transferred into a bank account.

In a nutshell: Paypal is an easy way to send and receive money online. In the case of Paypal phishing scams, perhaps a bit too easy. But we'll get to that soon enough.

A Typical Paypal Signup

The Paypal signup process is mostly painless. Click on the new account link from their main website and they'll start to ask a series of questions to establish what laws and regulations apply to you.

First, they'll ask what country you're in. Then they'll ask for a mobile phone number so that they can confirm that the instructions are coming from you.

Then, after that number has been verified, you'll need to provide a name, mailing address, and E-mail address. The name should match the one used on any banks or credit cards you plan to link. The E-mail address will need to be able to receive a validation e-mail from Paypal.

Then you'll create a unique password for your new Paypal account and select two security questions, similar to what you would do at a banking website. These will be used to recover the account in case of emergencies. You can later turn on and test two-factor authentication, making it so that a texted security code needs to be entered every time you log in.

Paypal will want to know if you're a personal or business account. Most normal people should select 'Personal'. For business accounts, validation and setup may vary from country to country.

Finally, you can choose to validate your Paypal account by hooking it up to a bank or credit card. Unvalidated accounts still work but have a maximum withdrawal rate of $500 a month.

And that's it. The process is relatively easy, and simply having a Paypal account to receive funds as needed is a handy backup plan, particularly if you travel a lot or shop primarily online.

How to Avoid Paypal Phishing and Scams

Now that you have a Paypal account, you can be scammed like everyone else!

Or to be more precise, you need to know what to look out for as far as Paypal scams go. Some people will try to impersonate folks that you know and attempt to get you to send them 'emergency' cash. Others will set up fake charities and businesses in an attempt to get your money and cash out before Paypal can handle the disputes. Some buyers will dispute legitimate charges for things they bought from you, trying to get them for free. And still, other scammers will pose as Paypal themselves, and try to get your information to take control of your Paypal account.

Firstly, it should be noted that many scams out in the wild tangentially involve Paypal. For example, the scam where in order to receive a (non-existent) package, you need to scan a QR code to pay 'import duty' from the deliverer. So this topic can be rather broad if taken to the extreme.

The scams that are unique to Paypal involve its specific rules and functionality. For example, because buyers can dispute anything on Paypal, they'll buy things off of eBay and then claim they never received them, or that it was destroyed in shipping. The tedious process of challenging the scammer's claims eats the time of legitimate craftspeople and collectors, and the right side doesn't always win. Avoid these by keeping a copy of all evidence whenever you sell something: The original request from the buyer, the proof of shipping and delivery, etc.

Charity and fake business scams all have one thing in common: They try to buy time. Most fake sales sites will be 'pre-order' only, with no other products for sale, and a long wait time before delivery. And of course, charities aren't sending anything but good feelings. To combat these scams, always make sure that the charity or business is registered with the government they claim to be under, first of all. Almost every company has a tax-exempt organization search. Most governments or states have business lookup services as well. Use that information to search their owners, and generally their reputation. Don't get involved with completely unknown organizations! If you think you've been scammed, activate your Paypal buyer protection.

Actual Paypal phishing happens in two ways. The first is that a legitimate company's name is being used to fool people into sending money to a fly-by-night Paypal account. This is often done by sending an e-mail from a domain that looks like the legitimate site, but upon close examination is a different domain entirely. Perhaps the domain name is one letter off (m1crosoft), or perhaps it has the wrong suffix (microsoft.biz). Similarly, the links in the E-mail won't take you to the legitimate company site, being from addresses such as the above, or from a supposed 'third party' payment or shipping handler. If you're unsure about the origin for any reason, avoid these Paypal phishing scams by only going directly to the well-known company's main website (microsoft.com for example), and contacting their sales and support to see if the e-mail is legitimate. Usually, it won't be. You can report odd E-mails involving Paypal to spoof@paypal.com and the support team will help track them down if possible.

The second Paypal phishing scam pretends to be a letter from Paypal itself. Often it will ask you to 'claim' something or fill out additional information, both of which are completely unnecessary on Paypal. Never click on an attachment in a Paypal E-mail, they don't use attachments. Never provide additional personal information or tracking numbers via E-mail. Never go to a 'third party' identity processor if requested. And always go directly to your Paypal account to check information, never click on an E-mail link! These are the best ways to avoid Paypal phishing scams. Once again, report any odd E-mails that you get involving Paypal to spoof@paypal.com as soon as possible.

Avoiding Paypal Phishing with Better Privacy

Scammers and phishers don't just try every possible combination of letters and numbers to find the E-mail addresses that they wish to target. They scrape them off of forums, buy them off of known good E-mail address lists, and otherwise acquire them over time.

But what if the E-mail address that you used for most websites, sign-ups, and forms wasn't your real address? What if you could be far more anonymous? There would be a heck of a lot fewer scammers and phishing attempts on your account, that much is certain.

Internet privacy and protection apps can make that a reality. By generating random E-mail addresses to register for new websites, you can protect your real E-mail address from getting scraped from dodgy sites. And using randomly generated secure passwords for each site, old passwords can't be used to crack other accounts that you might own.

Additionally, some attackers will try to look up your personal information in order to make their Paypal phishing E-mails more personalized and convincing. They use something called browser fingerprinting to determine a unique digital signature for your accounts, so even if you're using fake E-mails and names, they can continue to track you.

A robust privacy tool will mask your web browser's vital fingerprinting parameters, spoofing everything from location to browser type to video and audio details that some scripts try to determine. With such fingerprint protection in place, you'll be far less likely to be tracked through your anonymous E-mail addresses.

How to Delete a Paypal Account

If for any reason you want to close your Paypal account, a few things should be noted: This will not remove transaction evidence made with other accounts, as Paypal needs to maintain a legal audit trail. So committing fraud and then deleting the account does nothing, as far as their ability to track down an account owner, submit evidence to the court, or work with law enforcement agencies.

Another thing to note is that once an account is closed, it cannot be reopened. Going back to Paypal will mean a brand new account after restarting the Paypal signup process, with none of the history or contacts from the old one. Consider carefully if that's what you want the end result to be.

Finally, in order to delete a Paypal account, you must go to the website. The Paypal app will not allow major account changes or deletions. Instead, open up the secure browser of your choice and

With these things in mind, here is the process of how to delete a Paypal account:

1) Transfer or withdraw all of the money. Any money left in the account before deleting it will be defaulted. So make sure to transfer the remainder to a bank account, or to another recipient of your choice.

2) Go to the Account Summary page. Usually, this can be found here.

3) Click on the Cog icon. The cog icon is located next to the Log Out button at the top right of the screen for most desktop browsers. On mobile, it will be under the Menu option, denoted by three parallel horizontal bars. In most countries, this takes you to the Settings page, depending on account status.

4) Click on 'Close your account' at the bottom left. Or on mobile, that link will be located just below the Account Options section.

5) Follow the prompts and confirm your actions. Make sure that you've read and understood all of the procedures and consequences before you delete a Paypal account.

When you've confirmed your account ownership and made the final confirmation of your actions, that's it. There's no going back. In order to use Paypal again, you'll need to create a fresh account.