Verified answer

unfortunately, you have identity theft. The first thing you need to do is call your credit card company, explain the situation, and cancel your card. Do this as soon as possible!

In some cases, you may not need to pay anything back, since they are not purchases by you. Call you credit card company, and while canceling the card, ask them what you should do next.

paypal can be used to pay for something without having a paypal account just like swiping your card at a point of sale. the $1 transaction is probably a person trying to figure out if the card number is active before they head out on a shopping spree. call your credit card company immediately tell them your account may have been compromised, they can issue you a new card with a different number and then you file an unauthorized transaction report with your credit card company and they will reverse the charge.

Someone stole your credit card data, and used Paypal to charge it for transactions. You should immediately get the card cancelled and a "identify theft" alert set on your accounts. Otherwise you may not get any protection.

Who knows how they got it, maybe your wallet was stolen.. maybe you typed it into some phishing (like a fake bank) website, etc.