I believe that Paypal (and judging by the comments above: banking institutions and credit card companies) are going to these customer-service-destroying efforts

I believe that Paypal (and judging by the comments above: banking institutions and credit card companies) are going to these customer-service-destroying efforts at fraud prevention because the regulatory environment forces them to do so. If so, lets put aside the question of whether it is "right" to put the responsibility of service abuse on the service provider, but instead ask the question: is any of this really in our best interests? It seems to me that a consumer population would be better served by not being artificially protected and thus completely off-guard when they do get caught in a scam. Any payment processed online should be done with the same amount of wariness and forethought that a purchase at a brick-and-mortar retailer would be. Now, it's possible that I'm wrong here and Paypal is actually doing all of this as some sort of verification service to provide a fraud-free environment for payers (i.e. paying with paypal will never be a scam). If that's the case , then this is a really ineffective way of going about it. It seems like a great deal more upfront investigation and analysis would be appropriate. I would take some of the peer-to-peer lending services as a model.