Clearly a scam. Reverse both the deposit and payment and be done with it.
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Quoted from ForceFlow:The scam happens when you start a *new* transaction to send money back.
Right, the way the scammer gets your money is you do a new transaction sending B's money to A. Then B reverses the original transaction and you end up having to pay PayPal later on for the chargeback (see, for example https://pinside.com/pinball/forum/topic/paypal-do-not-accept-payment-using-paypal). But refunding it would make it like nothing ever happened (although it might be worth a phone call just to confirm you won't get stuck with any fees).
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