I think PayPal's security is up there with any other online transaction security. We use PayPal but were disappointed when they restricted out account for what they say was 'Unauthorized Use'.
They gave us ZERO warning instead of, 'We believe your account has been accessed by an unauthorized person' and letting US look into it.

Personally, we are looking to drop PayPal because we have already had chargebacks on service we have done. They seem to side on the consumer more than the merchant.

But that has nothing to do with their payment system ..... just their ethics are in question to me.