When doing business online, always research who you are selling to/buying from.
I try to avoid doing business with members who have 0 feedback. If I see that a member has lots of good feedback, I feel much better, but I always do a quick search of the person's name/email/phone number to see if any red flags come up. Also, never use paypal gift. The extra 3% that you have to pay is worth the satisfaction of knowing that if you get ripped off, paypal can refund your money.
I'm glad to hear that the bank sided with you.
Now, let's ban this guy. This community has no room for scammers!