Etsy error results in unauthorized withdrawals from sellers' accounts
A payment error on Friday resulted in a number of Etsy sellers discovering that money had been taken out of bank accounts which were connected to their Etsy stores.
The Etsy Community forum was flooded over the weekend with complaints of sums of money going missing. Multiple sellers alleged that the company took anywhere from a few hundred dollars to up to tens of thousands of dollars from their bank accounts.
In a statement emailed to Retail Dive, a spokesperson for the company said that a small fraction of one percent of active sellers' cards were incorrectly charged and that in cases of overdraft the company will, "refund any undue fees associated with this incorrect charge and change in deposit schedule." Etsy also released a statement that said all incorrectly charged cards have been refunded.
Etsy seller TheraClay first posted a message in the e-commerce website's community forum on Friday, stating that the company drafted $395 out of her checking account.
"WT heck is going on? Did Etsy draft this out of my account?" her message read.
What followed was a slew of sellers alleging that the company unexpectedly withdrew funds from their accounts. The company said that what occurred was, "not a fraud issue, but instead an error related to a site change," in a statement about the incident. In an email to Retail Dive, the company also clarified that the error was unrelated to buyers' purchases.
The incident occurred prior to a federal holiday weekend where many financial institutions were closed on Monday, leaving some impacted sellers unable to contact their banks. Etsy stated that, "It may take several business days for the refunded amounts to clear and settle in card accounts."
Although the potential long-term impact of the error is unclear, many sellers within the forum stated that the error was making them consider going to other marketplace platforms like Shopify.
The company is expected to report earnings on Feb. 25.
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