Google is Evil, Worse than PayPal: Don’t use Google Checkout for your business

The whole saga is worth reading, but just to let you know: here’s the latest.

Wanting to offer an alternative to PayPal, we set up a Google Checkout account for people to buy our ebook.

The last email we received about our Google Checkout account was “Helpful tips regarding your first Google Checkout orders” on February 9th.

But a few days ago, I logged in, and this is what greeted me:

And if you click that link, “I had pending payouts for charged orders. Will I receive these payouts?”, you’ll see that the answer is “Nope, you’re screwed.”

So, to sum up our experience with Google Checkout:

  • they did not try to contact us to resolve any issue
  • there’s no way to find out why they closed our account, due to “security reasons”
  • there was no notice (we found out by accident, when we tried to pay for something with Google Checkout)
  • they kept over $200 of our money
  • there is no appeal
  • there is no one we can contact
  • we cannot open a new account
  • our money is gone, even though people have received their products

And I don’t know if you noticed, but that agreement section doesn’t actually have anything to do with this situation. It’s clearly just there to cause a sense of despair & make readers believe they have no legal recourse.

Crime Does Pay

This is on top, of course, of their theft of over $2,000 for Adsense revenues for the web site for script.aculo.us, which happened in similar circumstances (no warning, no appeal, no replies, etc., etc.).

So, despite any number of ads I’ve clicked in my life using Google search, they’ve also made a cool $2300 at least from us by stealing our cash outright.

Translation: Google is even worse than PayPal.

Do not use Google Checkout for your business.

PayPal, as a company with financial services that have caught the eye of the government, is subject to a lot more regulations… and, surprisingly, acts better.

‘Don’t be evil’ my ass.

Lest you think we’re an exception, we’re not the only ones who have been robbed by Google; this guy sued and won in court, but he was lucky to reside in the correct district. For us, it’d be a bad business decision based on the costs vs possible reward. So it is with most people, which is how Google can get away with it.

88 Comments

  1. Alan says:

    Thanks Amy for posting this user experience.

    I am delivering a full days session in New York next week all about the wonders of cloud computing and how you can utilising the servers of people like Amazon and Google.

    I do warn though, about vendor lock-in, and how you are at the mercy of these companies. Its amazing how little customer support they give, even Amazon.

    There is room for the small guys to come in and offer a proper supported service with real humans to help.

    I have cited your case here in my presentation as a warning to others

  2. John McCarthy says:

    Yes, as Morgan points out, online-payments is a lot harder than it looks. I would not look at using any provider that did not have scar tissue to prove they knew how to survive and win in the business. PayPal is the gold standard. Amazon Payments, backed by Amazon’s long history of successfully managing online payments would be the 2nd place I would look. They have been doing some good work on developing new products and need to spend time building market share.

  3. LH says:

    Great warning. I’m looking at setting something up for a customer and was considering Google as an alternative to Paypal. Not anymore. Once again, Google fails on customer service.

  4. Hi Amy,

    Thanks for the article. I found it through a forum called Pistonheads.

    I too have had problems with Google. Only a couple of days ago I got the dreaded "your account has been closed" email.

    They have $108 of my money in return for my services to them by advertising for their advertisers.

    They refuse point blank to offer me an explanation and since my site is registered in the UK, I will demand they give me the necessary information which as you are probably aware is my legal right in the UK under the Data Protection and Freedom of Information Acts.

    Either that, or I will take them to the small claims court.

    It’s only $108, but it’s the principle. I cannot even log into my account to view exactly how much is owed, but I’m sure Google have already fiddled the results.

    I hope you managed to get your $2300 back.

    I also hope Google her their asses sued and hope they all have a crappy weekend.

  5. Google Boycott says:

    Wow. Google is truly going to the dogs now. Sorry to hear about your lost $2300 which you will probably not get back. I think the only way to really get Google to take notice is to simply boycott using their services for a day. They would lose all kinds of money and traffic and Yahoo would quickly become the #1 search engine in the same day; this is the single most powerful vulnerability they have and if you look at their business structure and behavior you can tell that they are scared as *** of that ever happening. A Google Boycott would bring them to their knees for mercy and then maybe you would get your money back , just so they ould make you and others ‘go away’. That’s a reason they are trying to buy up the airwaves. You can’t jam Wifi but you can stop data flow through wires.

    A once great company led by two noble young chaps, now investors have got the best of them. I known Page and Brin must toss and turn at night sometimes to see how their little baby has grown up into a rude, stingy, conniving, thieving copyright infringer of a company. it’s sad. I remember the days when I recommended people to use Google over Altavista which was the best at the time, but not anymore. I try to use any other site and only use Google out of necessity. Google IS evil and too big too much of a monopoly. It would be wise to not put so much information in the hands of one company. Anyone who want a glimpse of what it could turn into — rent the 1992 movie FreeJack with Emelio Estevez. It’s scifi but the McCandless Company is the closest thing to what Google is turning into. Sad.

  6. Jim Mcnelis says:

    You violated the terms of service. You were evil, not Google.

  7. Alamgir Kahn says:

    Hit them hard. Get a small claims court judgement against them, and then contact a Sheriff to put a lien against on of their properties.

    If you’re in CA, get a Sheriff to put a lien on one of their campus buildings (i.e., put chains on the door so no one can get in) and sit back and wait until Google pays up.

  8. Seth says:

    As most people have said here, sorry to hear this happened to ya. Hope you are able to get your money back.

    Also, like a lot of people said, take them to small claims. I’m pretty sure that since they are a company operating on the internet, you can sue them, even if they don’t operate in your local area.

    Best of luck.

  9. Peter says:

    Alamir, darling – Amy lives in Vienna, Austria…

  10. G says:

    Google has the WORST customer service in the world. The fact that one of their web spam people (Matt Cutts) has to read this, that you have to blog about it, for anything to be done, is a travesty. And the sad thing is that Google is as good as they need to be, since they are pretty much the only place to make money online and they dont need to be any better than this (fortunately, there is Paypal in the payments department, but if you get on their bad side with AdWords/AdSense, you might was well pack your bags for an offline career).

    I will say that the guy who sued in small claims court was almost certainly breaking their terms of service and deserved to have his account shut down; but there are more than a few cases of people who make either honest mistakes or get caught by some kind of stupid robot filter that makes it clear that Google really doesn’t care about the little people, as they make most of their money off big advertisers, and since they have no competition online, they deign to invest the time and resources it takes to properly support people who make them money.

    Best of luck with your situation, been there before, there’s not a lot of hope I can give you.

  11. Andy Brice says:

    There are lots of other reasons not to use GoogleCheckout (at least not as your main payment processor): http://successfulsoftware.net/2009/03/14/googlecheckout-price-increase/ None quite as compelling as the one mentioned here though. Ouch.

  12. Jason Miller says:

    Wow. It’s so sad that I had never read your blog before, I was minutes from using Google Checkout. Now I won’t! :)

    Also, where are all you comment-ers from?? Most of those comments were actually worth reading, which is so strange for the web…

    bookmarked

  13. Ivan says:

    thanks for the warning. I was planning on going with adsense, but now I wont. there is definitely a rumbling of discontent with google, and i think i’ll skip over the part where they basically steal money from me.

  14. Also scammed by Google says:

    I would never use Google Checkout after also being burned for $1,800 by Google with AdWords. After they completed a internal investigation, they ruled all clicks were valid without even so much as a glimpse at our server logs which I had provided them access to.

    What is interesting about this is that our bill was originally $1,300.00, after the investigation we were told we would receive a $500 credit, they then charged our card an additional $500 bringing the total to 1,800.00 US. Obviously this is not a isolated incident based on comments here. I wonder what percentage of their revenue is based on questionable activities like this.

  15. James Davis says:

    Pardon my evangelism, but your article caught my eye. Have you looked at 2checkout.com? We’re not as big and well known as PayPal or Google Checkout, but we offer many things that they don’t. Chiefly 24/7/365 customer support. We even offer PayPal as a payment option, though I wouldn’t actually call that a selling point ;)

    There is a one time signup fee of $49 (USD), and occasionally we run specials like offering free vendor account signups for a day. After that, we take a 5.5% fee on all sales processed through us. I invite you to come check us out. We may be able to fulfill your needs.

    If you have any questions feel free to contact us at 877.294.0273, and ask to speak with Vic Cleary or Geno Arce from our marketing department.

  16. Justin says:

    This is not new to Google Checkout. Their ads system has had similar… "problems".

    http://www.huffingtonpost.com/aaron-greenspan/why-i-sued-google-and-won_b_172403.html

    And by the way, if they could prove a breaking of the ToS, why did they not bring it up in court to immediately smite the case? The only conclusion I can draw from this linked story is that they cannot prove this in any way tangible to the courts.

  17. Justin says:

    Interesting. That bolded, italicized b in the URL above should be underscores surrounding a b. Yay for unspecified comment formatting?

    This link is to the same article: http://tiny.cc/PXjHT

  18. V. Varghese says:

    I had a similar bad experience with Google Adwords.

    Adwords automatically started serving some of my ads without my permission and they would not give me a refund.

    I am not that surprised by your post.

    Avoid these bozos.

    -VV

  19. Yossef says:

    Woah, lots of comments since my "flare-up" at the beginning.

    Amy, you know I have trouble not being an ass. And I was just trying to point out the different uses of "sorry". Jim got it right afterwards — (sy|e)mpathizing, not apologizing.

  20. John says:

    Seems like I’ve heard a lot of complaints about this from the customer end, too. Mostly, long delays (days, weeks) between making the payment through Checkout and when the vendor receives payment/confirmation. Hopefully, a few more small claims cases like the one recently will put an end to Google’s random cash grabs & account shutdowns. Probably not, though.

  21. TekGems says:

    We do not sell digital downloads (eBooks, MP3s, etc). We sell tangible goods and Google Checkout has not been an issue. We’ve had a few chargebacks here and there, but nothing outside of percentages that we would encounter on our merchant account or Paypal. You can try 2Checkout if you want as an alternative to Paypal & merchant account.

  22. bs says:

    Great warning. Google’s lack of accountability to these things will be their undoing.

  23. In reading Morgan’s post, who used to work at PayPal, I have no doubt that fraud is heart of the problem. How about we forget about credit cards and cheques, and just PUSH money electronically to the various people we are buying from? (Instead of giving them a number and then they PULL the money?)

    Seems a lot more secure. Basically: bank transfers. Like they’ve been doing forever in the EU. (And why PayPal and credit cards aren’t so popular over there.)

  24. Stef says:

    Interesting. Here in France, banks sell an e-commerce kit that any merchant can install and use.

    Fraud? The situation is supposed to improve with VISA’s 3DSecure program, included in e-commerce kits (basically, the customer is being asked information(s) that is not in the credit card).

  25. jjray says:

    Another issue I have with google checkout is that they give the customer an absolute right to a refund for 24 hours. I sell online legal forms that are created immediately after purchase. If I were a merchant on google checkout, the users could obtain the form then get a refund from google. I’d be SOL. Thanks for sharing your story. It reinforces the negative impression I’ve had of checkout.

  26. Dick C. Flatline says:

    I refuse to do ANY business online. I give customers who visit our website an 800 number, where they can give their card info to a real HUMAN, who is RESPONSIBLE for how they do their job. We explain to our customers that web payments are NOT secure, and they overwhelmingly appreciate it. Maybe that’s why our business is booming in this "bad economy".

  27. Igor Chudov says:

    I hear some sob stories how "ebook sellers" and "intangible goods" sellers are so devastated by their accounts being closed.

    And I have to ask myself, have I ever seen an honest sales pitch for any ebook, or an honest sales pitch for "How I make thousands per month with XXX" paid reports.

    And the answer is that everything that I have seen reeks of dishonesty even a mile away.

    If so, could there possibly be a great reason for google to close such accounts? Could it be that dishonesty breeds dishonesty and the "intangible goods" sellers engaged in various other forms of underhanded practices?

  28. mistermister says:

    for more than a year now, i have used Firefox and the plugin "No-Script" to block google analytics on any site that uses it. it’s as good as a boycott. join me.

  29. alex says:

    Just a quick note here…

    a) A lot of you mention, or link to, the story of the guy who sued Google and won. I personaly am not quite convinced that this guy is for real. Even he IS for real, he was clearly abusing Googles Terms of Service and myu personal opinion is that he was ripping advertiser dollars.. Google SHOULD have won that case, IF the judge has ANY clue as to what online business is…

    b) Don’t forget that this post is just one persons story… Its NOT the facts. Its how she presented the whole thing. Now I am not saying she is lying. Maybe she is maybe she is not. But other that black and white, gray exists too. I am sure that if Google actually cared (and as much as I love Google and its products, I don’t think their algorithmic approach to products lets them care…) they would present their own , different side of this story..

    alex

  30. Jason says:

    Yeah I’ve also had a issues with them with their ad program and they removed me and wouldn’t tell me why I have since then stopped using them.

  31. ODWGOOG says:

    One Day Without Google was here, too :)

  32. tony says:

    2checkout, one cup ( full of chargebacks)

  33. Amy says:

    I just deleted two comments that accused me of being a lying, stinking ebook seller. Feel free to accuse me on your own blogs, but not on my own. And if you take that much effort, maybe you should do your homework first.

    Anyway, quick update… I got a form letter email from Google saying "During a recent review it has come to our attention that your merchant account ID [my id] was closed due to a technical error. "

    More detailed follow up post coming.

    But don’t think I think this is justice served. It’s incomprehensible that this is the only way to get my money back.

    Not everyone has the wherewithal or support of the community to write or get attention for a blog post about getting ripped off.

    And no word on the Adsense money. Although it’s from a while ago, I’m still pissed.

  34. Evan says:

    Could it have something to do with the fact that you didn’t check your email for at least a week? I eventually got in touch with you through twitter, but let’s face it: I shouldn’t have had to do that. If you hadn’t gotten back to me that day I probably would have complained to Paypal.

    You’ll get plenty of blogosphere pity playing the victim but I don’t believe for a second that Google just decided to close your account unprovoked.

  35. alexis says:

    @Evan: spot on Evan \ She is the poor victim, she doesn’t hesitate for a minute to accuse google of lying and stealing, BUT… when I WRITE THAT maybe JUST maybe, everything is NOT black and white… and MAYBE this is a one-sided story, and MAYBE google has its reasons for blocking her account…

    SHE DELETES MY POST!!!

    so.. Google can’t do whatever it want… but.. SHE CAN!???

    go drink a hot chocolate and enjoy Vienna.. stop playing the victim

    alexis

  36. burfalcy says:

    I stopped using Paypal after they illegally refused to refund money owed me from a cancelled order (acknowledged by the seller to be cancelled).

    The seller then refused to refund on the grounds that they shipped it to me AFTER they acknowledged my cancellation — by US Mail. Because unsolicited items sent via the mail are a gift as per US regulations, I threw the item away as I no longer wanted it.

    The seller refused to send me the refund they’d promised (before they screwed up) despite Paypal claim dispute, BBB complaint, mail fraud report, Attorney General report, and everything I could think of. Paypal refused to force the refund through.

    I finally got my money back by finding executives’ emails over a year later, sending a complaint straight through them, and finally got my credit. Of course, it was a "one time only courtesy" and they also refused to debit the thieves (that’s what they were for what they did) because of some bullshit "we don’t take sides" crap.

    As a one-time-only courtesy, I removed my credit card and bank account from my Paypal account when the whole mess first happened. I spent the money they "courteously" gave me the same day, and will never use Paypal again.

    I will not shop at that place ever again (sadly, enough fanboys for the type of item it was went out of their way to retaliate by shopping there — WTF — that it did no good to report the fraud on related forums), tell everyone in the market for that kind of widget not to shop there, AND Paypal is dead to me forever more. So is ebay, because they’re the same company.

    And here I was thinking that Google Checkout would be a safe alternative… then I saw this. Combined with nearly no one taking GC, that just cemented my decision to only pay with a credit card. At least if I do that, my bank will force the refund through, no matter what the merchant wants, when they see the proof of illegal behavior.

    Why can’t one of the big national banks start competing with Paypal? Everybody would be protected because banks actually have to follow real rules.

    Obviously, Paypal doesn’t give a damn about real, provable (I had everything in writing) FRAUD.

    So there’s MY horror story … at least I did eventually get the money back. I know you posted a followup, but since I don’t see anything about them reversing their mistake and fixing your account, I’d call executive customer service and complain. Loudly. Even if it’s a year later…

  37. [...] Google Checkout. (Update: Google Checkout is now becoming as bad as PayPal as described at Squidoo, Slash7 and on the Google Forums. Google is becoming renowned for its breathtaking arrogance and appalling [...]

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