PayPal Anti-Counterfeit Policy Results in Destruction of Antique Violin

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Piracy and counterfeiting are criminal acts, and online auction sites are rife with fake goods. But when an antique violin is deliberately destroyed due to PayPal’s anti-counterfeit goods policy, does it bring question to such online rules?

A Regretsy reader wrote about a regrettable experience with PayPal. As a seller, “Erica” sold an antique French violin to a Canadian buyer, who then disputed the label on the instrument. But instead of simply returning the violin and asking for a refund, the buyer was apparently instructed by PayPal to destroy the item and then send photographic proof of destruction prior to being issued a refund.

Rather than have the violin returned to me, PayPal made the buyer DESTROY the violin in order to get his money back. They somehow deemed the violin as “counterfeit” even though there is no such thing in the violin world.

PayPal is apparently within its rights to ask for the destruction of counterfeit items, given that eBay policies ban the sale of replicas, pirated and counterfeit goods (including apparel, software, etc.). PayPal’s terms of service say that “PayPal may also require you to destroy the item and to provide evidence of its destruction,” in reference to counterfeit goods. Likewise, PayPal’s parent company has a similar policy. ”We don’t allow replicas, counterfeit items, or unauthorized copies to be listed on eBay.”

Observers say the reason behind the destruction of fake goods is so these will no longer circulate in the market, thereby protecting other potential buyers from buying the same item. This is also for the legal protection of both the recipient of the fake item and PayPal itself, given that sending counterfeit or stolen items through the mail is a criminal offense.

However, the question here is the validity of PayPal’s instruction to destroy the item, in particular given its value, and given the question of the validity of the “counterfeit” claim. Erica says that the violin has been examined and authenticated by a top luthier prior to the sale, and that labels are often disputed when it came to valuable instruments like this. “In the violin market, labels often mean little and there is often disagreement over them. Some of the most expensive violins in the world have disputed labels, but they are works of art nonetheless.”

There is also question whether this system can be used to perpetrate fraud. For instance, a buyer can purchase an authentic item, and then claim it as fake, but then substitute the item for a fake (say, a fake branded bag) when sending photographic evidence.

PayPal has advised Regretsy that they are looking into the matter, although as it stands, an antique $2,500 violin has been irreparably destroyed, and the seller has apparently lost this much in value. Perhaps the lesson learned here is to never buy or sell expensive and rare items online, especially if these are one-of-a-kind.