The personally addressed email mentions a recent transaction with "Mercy Peters" and threatens legal action because of refusal to provide Western Union details to PayPal.
The scammers claim that "Mercy Peters" has contacted Action Fraud to make a report about the violated PayPal agreement and request a scanned receipt and Western Union details within 24 hours in order to stop your name and address being sent onto law enforcement agencies. The fraudsters are sending the emails from this address: email@example.com.
Action Fraud would never contact you and make threats in this way. If you want to verify communications claiming to be from Action Fraud you can call 0300 123 2040 or email firstname.lastname@example.org.
Follow the tips provided by Paypal to stay safe from PayPal scams:
Log in safely: To log in to your PayPal account or access the PayPal website, open a new web browser (e.g., Internet Explorer or Firefox or Chrome) and type in the following: https://www.paypal.com/
Look out for attachments: PayPal emails will never ask you to download an attachment or a software program. An attachment found in a PayPal scam email will often contain a virus that can harm your computer or compromise your PayPal account
Never give out personal information: If Paypal require information from you, they will notify you in an email and request that you enter the information only after you have safely and securely logged in to your PayPal account.