PayPal is pretty much about bad things happening 
to everyone, except PayPal (buyers get scammed as 
well).

My trick for using PayPal is:

1. I've never become Verified.  So, they don't 
have access to my bank account.  If I did become 
Verified, I'd do it by opening a separate bank 
account just for PayPal, which I would not keep 
any money in;  and, after PayPal had confirmed 
that my back account was live, I'd arrange for 
the bank to block all electronic transfers out of 
it anyway.

2. I don't keep any significant amount of money 
in PayPal.  As soon as there's enough of a 
balance in the PayPal account that it would 
bother me to lose it, I have PayPal send me a 
check.  I don't allow them to hold on to my funds.

The point of all of this is, don't put funds at 
risk by giving PayPal access to any funds for any 
longer than it takes to request a check from them.

I have not been scammed yet, but if I ever am 
scammed, I'll just say "Sorry PayPal, it's your 
loss, not mine.  This is one your costs of doing 
business and acting like a bank, when you're not 
a bank.  Go ahead and close my accounts, PayPal, 
because nobody needs you that much, and I won't 
be using you again".

Hopefully, I'll never have to do that, but I'm 
prepared if I need to.