Ok Guys, just got an answer from Pay Pal - It seems like you can buy seller protection but only for certain transactions. This Seller Protection (if it is applicable to your transaction) is either Full Protection or Partial Protection. Full Protection - Protects you the Seller if (a) Goods don't get to the buyer or (B) the buyer is fraudulent and his payment fails for some reason. This is the one you would need in this instance Partial protection - Only protects if (a) Goods dont get to the buyer, so not helpful in the case of a fraudulent buyer. But heres the catch - Looking at the "Legal Stuff on the PayPal Website" Full Protection can only be obtained if you sell on EBay and ship directly to the address registered on the Buyers PayPal Account and not to his son at some other unregistered address. So in short - you're exposed. Here is the response from PayPal. Thank you for contacting PayPal. Following the Seller Protection Policy is completely voluntary. However, if you choose to engage in transactions not covered by the Seller Protection Policy, you assume the risk associated with the transaction, as well as any potential liability. Not all transactions are eligible for PayPal Seller Protection. If a transaction is eligible for PayPal Seller Protection, you’ll see ‘Eligible’ or ‘Partially eligible’ on your ‘Transaction Details’ page. Here’s how to see if your transaction is eligible for Seller Protection: Go to www.paypal.com and log in to your account. Click ‘History’ near the top of the page. Find the transaction, and then click ‘Details.’ Under Seller Protection see if your transaction is eligible. Note: With ‘Eligible’ transactions, you are fully protected if your buyer doesn’t receive the item you shipped or if an unauthorized payment was made. With ‘Partially eligible’ transactions, you are fully protected if a buyer doesn’t receive the item you shipped. A ‘Partially eligible’ transaction does not protect you against unauthorized payments. If you don’t see ‘Eligible’ or ‘Partially eligible’ on your ‘Transaction Details’ page, the transaction isn’t protected under PayPal Seller Protection. To learn more about PayPal Seller Protection, click ‘Legal Agreements’ at the bottom of any PayPal page, then click ‘User Agreement for PayPal Service.’ Thanks for sharing your concerns with us. We value what you have to say, and we know situations like this can be difficult. If you have more questions, visit our Help Center by clicking "Help" in the top right corner of any PayPal page. Add your mobile number to your PayPal account so we can reach you right away if we ever need to verify account activity with you. Simply log in to your PayPal account, click "Profile" near the top of the page and then click "Update" beside "Phone." You can also make and receive payments with your mobile phone when you add it to your PayPal account. After you confirm your number and create a PIN, you'll be able to get money, send money, check your balance, or manage your account from your phone using simple text messages. Sincerely, Amanda PayPal, an eBay Company