Cynical Upwork!!!!

[natro123]

After the client released 1000$ escrow to me and closed the contract leaving me 5 star feedback, I got the following message from upowrk:

I am rephrasing because upwork deleted part of the message: “we have found evidence that your client was related to fraudulent activity, for your own security we are giving back the payment he already released and you are left with 0$”
**Edited for Community Guidelines**


I realize this is unexpected and apologize for the disruption to your work. We have reviewed this contract and found that it is not eligible for Upwork Payment Protection at this time. Unfortunately, fixed-price protection is not available when the client is removed from the marketplace for fraud.


How Cynical is that? Upwork steals my money and calls it caring about me?

How can they do that?

[tlbp]

Your client stole the money or violated the TOS thereby allowing Upwork to void the contract.  

It is a tough way to find out that Upwork only pays if the client does. 

[natro123]

The client paid, escrow was released, they are trying to return back to fraudulent client?

[martina_plaschka]

No, it's not like that. It's not that the client paid, and upwork then said to him, you bleeping fraudster, we don't want your dirty money, that's why we are sending it back to you. Rather, the client never paid because his credit card couldn't be charged. 

Annoying, yes. Was there any indication from your side that this client wasn't strictly legit, like he overpaid you for your services? How many hours did you work for him and what did you do?

[davidsonjoshua]

What is Upwork's responsibility to weed out fraudulent clients? Is it only to foist the burden on the Freelancer -- once they have invested in completing the job? **Edited for community guidelines**

[petra_r]

Martina, "Rather, the client never paid because his credit card couldn't be charged." that can't have happened because a milestone can't physically be created without a payment method having been successfully charged.

That doesn't necessarily mean the client was the same person as the owner of the payment method or the payment wasn't fraudulent in some way.

[martina_plaschka]

Thank you Petra. Seems I have to revise my standard answer 😉

[petra_r]

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Martina P wrote:

Thank you Petra. Seems I have to revise my standard answer 😉

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It works fine for hourly contracts in many cases. Never for fixed rate.

[alexandernovikov]

It can't happen with fixed price contract. The charge to pre-fund the milestone is done before it is activated.

[a_lipsey]

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Giorgi N wrote:
The client paid, escrow was released, they are trying to return back to fraudulent client?

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No, not likely. Here is one potential scenario:

Your "client" stole the credit card he used to pay you with. So the rightful owner notified their CC company of fraud and a chargeback was issued. Upwork is not going to keep funds that were stolen. Upwork returned the funds to the owner of the CC, not your fraudulent client. 

If you were the owner of the CC, what would you want to happen? 

The best way to avoid this are: (1) always use hourly projects and track time using the time tracker, which offers the most protection (it's still not a 100% guarantee, nothing is, but it's the most protection); (2) vet your clients more thoroughly so you can be assured they are credible and not committing fraud or theft themselves. 

Some people prefer to do 1 versus 2 because they don't want to deal with vetting their clients and actually getting on Zoom to interview them. Others prefer 2 so they can be assured they know who the client is and that they are trust worthy. Still others prefer and understand the risk of working fixed price and not vetting clients thoroughly and are willing to take the risk. 

I vacillate between 1 and 2. 

[petra_r]

"they are trying to return back to fraudulent client?"

No, they are returning the money to the owner of the payment method the money was originally taken from...

[davidsonjoshua]

The "client" did pay, and Upwork held the money in escrow. Why did Upwork only discover the fraud when they had to let go of the money?

[2a05aa63]

Joshua D, if in this situation the fraud was found before they've released the money, the contract would just be cancelled before. Upwork gets no benefits from "refunding" since they lose their earnings too.

Many times if this happens after the client release the money, it is because the client used a chargeback.

[alexandernovikov]

I think it *only* happens in case of payment fraud, e.g. payment with a stolen CC number. Wrong?

[g_vasilevski]

Hi Giorgi,

I'm sorry to hear about the bad experience you've had. Feel free to follow up directly on your ticket and our team will assist you further. Thank you.

[natro123]

1) Upwork support lied that they deleted the client from marketplace because he is still active and messaging with me

2) The client got notification that he had some irregularities and in order to get full access of upwork services he was instructed to add a new card

3) client refuses to add new card because he is afraid upwork will double charge him because he never got the initial money back

I have all the screens from client and his communication with upwork where upwork support never mentions fraud or deleting from marketplace.

[petra_r]

I very much doubt that Upwork told you they "deleted" the client. The client will be suspended until they sort out the issue, which they clearly don't want to do... 

"Suspended" and "deleted" are two completely different matters. Suspended clients are able to message their freelancers (generally).

[natro123]

Petra, the original message which was deleted included the word “remove”

They said the client was removed

[victorminsky]

Hi!

Over the past few days, I've got to the same situation not once but twice with the same client (based on tasks) behind two different accounts.

In the first situation, I got my money to the stage when I was able to withdraw them, but then I received a chargeback notification. 

Now, with the second situation, I received a message that my client has been suspended just a few hours after the contract was ended. I again lost my money, and they've limited my financial transactions.

So, whose fault is it, mine or Upwork's not being able to verify the client's identity & payment methods not once but twice with the same person (I guess)?

P. S. The most "funny" thing is: (edited for CG) "If I'll be having such clients in the feature I'll be banned". So, I'll be responsible for Upwork's flaw in screening the clients.

[g_vasilevski]

Hi Viktor,

I understand your frustration with this and I'm sorry for the inconvenience this has caused you. I checked your account and I can see that you're communicating with our team on your ticket. Rest assured, our team will update your ticket as soon as possible and will assist you further. Thank you.

[natro123]

“Unfortunately you aren not eligible for fixed price contract protection when the client is removed from the marketplace for the fraud”

Does it get any more cynical?

1) the client is not removed from upwork, furthermore, he never got any notification about fraud, never in the email sent to him is mentioned fraud, he shared his screens to me.

2) I need protection from fraudulent clients dont I? If the client is a good willing why will I ever need Upwork’s assistance?

[davidsonjoshua]

From another thread:
Moderator: "Escrow is a neutral holding place where we put money aside until the project, or piece of the project, is done. The funds stay there until your freelancer or agency fulfills their obligations and you say you are satisfied those obligations are met and release them."

If Upwork holds the escrow funds from the point at which the contract is commissioned by the client until the freelancer requests payment, why isn't the client's funding scrutinized by Upwork during that period? Then at least the Freelancer might not get stuck having completed the project?

[natro123]

Cynical treatment continues:

Just got this message from support:

Please note that in cases of fraud, abuse or violation of the User Agreement, the Upwork Payment Protection shall be revoked and all monies due to the Contractor may be held and/or reclaimed, not just those from the contract(s) under review.


So in case of fraud they are stripping from protection, but in case of fraud from freelancer it is logical to stripe him for this privilege, in case of client thats when I need Upwork’s protection, they are basically telling me that if client is fraudulent they will void me of protection??????

[davidsonjoshua]

It just gets better and better!

[2a05aa63]

Giorgi, you aren't the first person to fall into this misfortune. There's a topic like this every few hours. You won't get that money. All you can do is waste your time. The culprit here is your client who most likely knew what they were doing.

Don't take big fixed-prices contracts from new clients. 

[natro123]

It doesnt matter if I am first or not. I do not like being bullied, I will sell my belongings but file a court dispute because of this maltreatment and cynical behavior from large corporation. Upwork even hasn't tried to offer some kind of solution like giving me credits to no pay future Upwork fees or anything, 

[2a05aa63]

Why would Upwork give you compensation for something a client did? The client scammed you for 1k while Upwork made you earn 30k. And now you want to sue them? You have every right to be angry, just use that anger for good not for dumb.

[natro123]

Upwork did not earn me 30k, I earned it and paid upwork solid fee.

Client did not scam me, client deposited funds on Escrow, and released the escrow, I pay Upwork 20% so it facilitates such an exchange, if I am not protected even through Escrow, why do I pay fees?

What a dumb logic is that - I am stripped of protection because client was fraud. At most Client scammed Upwork's Escrow system and Upwork makes me pay for it

[2a05aa63]

Any escrow service will revert a charged back payment or it would be basically an easy loophole drain the company dry. Upwork doesn't do anything special. 

Upwork needs to have better wording for these chargeback transaction. But I guess only disabling fixed project in general would solve this issue.

[natro123]

You do not understand how the escrow works, if escrow just reverted payments whhen one side makes chargeback request, the whole idea of escrow/escrow arbitrage would be priceless.

[davidsonjoshua]

So here's Upwork's presentation of its escrow process, from the 2020 Annual Report:

Escrow Funding Requirements
As a licensed internet escrow agent, we offer escrow services to users of our work marketplace and, as such, we are required to hold our users’ escrowed cash and in-transit cash in trust as an asset and record a corresponding liability for escrow funds held on behalf of freelancers and clients on our balance sheet. We expect the balances of our funds held in escrow, including funds held in transit, and the related liability to grow as GSV grows and may vary from period to period. Escrow regulations require us to fund the trust with our operating cash to cover shortages due to the timing of cash receipts from clients for completed hourly billings. Freelancers submit their billings for hourly contracts to their clients on a weekly basis every Sunday, and the aggregate amount of such billings is added to escrow funds payable to freelancers on the same day. As of Sunday each week, we have not yet collected funds for hourly billings from clients as these funds are in transit. Therefore, in order to satisfy escrow funding requirements, every Sunday we fund the shortage of cash in trust with our own operating cash and typically collect this cash shortage from clients within the next several days. As a result, we expect our total cash and cash flows from operating activities to be impacted when a quarter ends on a Sunday. As of December 31, 2020 and 2019, funds held in escrow, including funds in transit, were $135.0 million and $108.7 million, respectively. To the extent we have not yet collected funds for hourly billings from clients which are in transit due to timing differences in receipt of cash from clients and payments of cash to freelancers, we may, from time to time, utilize the revolving line of credit under our Loan Agreement to satisfy escrow funding requirements. We drew down $25.0 million under the revolving line of credit for such purpose in each of March and June 2019, which we subsequently repaid in April and July 2019, respectively. We drew down $15.0 million under the revolving line of credit for the same purpose in September 2018, which we subsequently repaid in October 2018.

[natro123]

Dear Petra, why do you feel entitled to tell me what I will and what I wont do?

Regarding escrow- can anyone tell me why escrow arbitrage exists? If one party can just revert already issued payment?

Non- specialists are trying to prove something here?

[petra_r]

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Giorgi N wrote:

It doesnt matter if I am first or not. I do not like being bullied, 

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Your anger is, once again, directed at the wrong party. 

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Giorgi N wrote:

 I will sell my belongings but file a court dispute because of this maltreatment and cynical behavior from large corporation.

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You won't. 

[davidsonjoshua]

So, Giorgi seems to have earned something like $30,000 gross through Upwork. That means that he paid at least 10% of that or $3000 to Upwork. I don't think he, or any of us, begrudge Upwork's cost-of-sales commercial formula; it is clearly stated up-front.

But for his contributions to Upwork's revenue over several years, can't he expect some protection from Upwork, by applying their considerable commercial experience and technical/technological power to keep him out of harm's way, and upon failing to do that, assist him in recovering his loss through Upwork?

[martina_plaschka]

If the client is in the same country as you, it might make sense to file a civil suit, if you are confident you know their real name and address. If the client is in another jurisdiction, and you feel that strongly about being right, you might have to sell your house first, as you have indicated. 

[petra_r]

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Martina P wrote:

If the client is in another jurisdiction, and you feel that strongly about being right, you might have to sell your house first, as you have indicated. 

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He wants to sue Upwork, not the client..,

[martina_plaschka]

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Petra R wrote:

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Martina P wrote:

If the client is in another jurisdiction, and you feel that strongly about being right, you might have to sell your house first, as you have indicated. 

---

He wants to sue Upwork, not the client..,

---

Ah right. Of course he does. 

[davidsonjoshua]

So, right now I'm negotiating a big fixed-price job contract with a first-time client through Upwork, and what I'm understanding from this discussion is that, Upwork doesn't really have my back on this, isn't really going to protect me if push comes to shove, and that "Payment Verification" and "Payment Protection" are really just slogans, BUT that I'm still going to have to pay the Upwork fee. Why should I make this arrangement through Upwork?

With all due respect to the gurus, I'd really like to get my answer from Corporate.

[prestonhunter]

re: "I'm negotiating a big fixed-price job contract with a first-time client through Upwork"

Here's how to do that:

If I have never worked with a client before, I don't assume that the client can be trusted with fixed-price contracts.

I work for the client using an hourly contract.

Or I start with a small fixed-price contract. No more than an hour or two worth of work for the first step. Then I submit the work. If the client releases payment as expected, and doesn't ask for any out-of-scope work, then I can trust the client with another, larger fixed-price contract.

As long as the client pays for the work as agreed, I can agree to increasingly large fixed-price contracts.

If the client is not a person who can be trusted with fixed-price contracts, then they will probably demonstrate that from the very first contract. But that was a small one. So I can walk away from it if necessary without having lost a lot time.

[2a05aa63]

For big fixed priced project look at the age of the client account. Chargebacks terminates their accounts.

If you still want it, then break it into smaller milestones to be paid once a week or so. 

Shame you don't trust "the gurus" since Upwork doesn't have this mechanism clearly explained anywhere, while it's a common scam.