Whatever you choose to do but I would not view it as ripping off PayPal or your card company. That is what they charge service fees and interest for. They also have other means for covering themselves, insurance etc., for these eventualities. That is part of the business that they are in. People commit fraud all the time with credit cards and the companies who issue the cards pay claims on these transactions all the time. For example when someone steals your card number and runs up your bill. You inform your card company of the fraud and you are only responsible for $50. You are entitled to these protections and services. The PayPal policy may be one issue and maybe they will not refund but I would inform them and your bank right away to record the complaint. If you are one of many who are having problems with the same seller it could be a serious problem that they need to act upon. If other charges appear on your card because the number was stolen by someone there will be a record of where the theft may have taken place. Even if you do not get reimbursed. They can still determine if fraud exists here and work to bring justice to the situation.