Paypal froze my account today

[bhuff85]

Sorry to hear about that Brad. That's definitely a pain in the ass. Hope you didn't have 5 figures or anything heavy like that locked up.

PayPal does have it's issues, that's for sure. I've got the business debit card and will make withdrawls once a week at an ATM. Anytime I use the card for anything else, say to buy business supplies or pay for something online, they immediately freeze my account, and I've got to go through leaps and bounds to get it unfroze. I learned my lesson the first couple times, and I just don't make any purchases with that card - Just withdrawl cash only.

[Mitch Miller]

Does anybody know at what point does PayPal start holding 10%? I currently run about 5k a month through PP. Maybe that's not enough to trigger the 10% withholding?

In regards to the business debit card, I have one and use it all the time without incident. I have often wondered if it isn't the debit card transactions that help them feel I am legit.

This chat makes me nervous as a whore in church.

[DogScout]

Originally Posted by sbucciarel

The op stated that he has had the account since Paypal opened it's doors. If that isn't enough time for them to decide whether or not he is legit, then there's something wrong with their process ... and withdrawing YOUR money at ANY time should not raise a red flag. It IS YOUR money ... not Paypal's.

There are moles in this country that have been here for years. One was arrested last week, been here 10+ years and he was a newbie. I suspect considering the efficentcy of carrying out these types of operations in a semi-free country mean for every one they nail, 10-12 are out there. Or so I hear.

[DogScout]

Originally Posted by trippmarxx

PayPal does have it's issues, that's for sure. I've got the business debit card and will make withdrawls once a week at an ATM. Anytime I use the card for anything else, say to buy business supplies or pay for something online, they immediately freeze my account, and I've got to go through leaps and bounds to get it unfroze. I learned my lesson the first couple times, and I just don't make any purchases with that card - Just withdrawl cash only.

Chase is the same way. They deny my card on a regular basis. Fraud prevention on steroids. Lol.

[ramone_johnny]

Man this sucks. If my paypal went down Id be pushing a broom within days.

[FaJeeb]

PayPal is the friggin' master at loopholes. Remember to use PayPal defensively, and always have a back up plan. I've got probably 10 horror stories that I could tell on this forum.

The great thing about PayPal is the fact that they are a Transaction Service and not a bank. This makes using them with what I call "defensive information" a great tactic when dealing with them for any purpose.

There is absolutely no way in hell I would be using PayPal if I were moving more than 4 figures a month. At that point, it would behoove ANYONE to choose a more professional service. It's crazy that such a profitable and wealthy company can be so unprofessional.

Another thing is, PayPal employees DO take part in forums just like these. I've been on several forums where people share their PayPal horror stories and every once in a while, we get a small wave of people that are for some reason pro-paypal beyond reason. After a while, moderators and administrators found that all of these pro-paypal people were posting from the same ISP.

[TommyBussey]

Yea, PayPal screwed me on my eBay selling account as well. They just freakin' froze everything without a warning or an attempt to inform that I was doing something against policy. Since then I have stayed away from using them for anything.

Originally Posted by l23bc

had the same problem with my ebay selling account and im marketing payments into paypal, they frozen my account too


hope you get it sorted

[deankagan]

Hi Brad

I used Paypal mostly for my ebay business up until about a year ago and we had one issue and it was related to a dispute on a return. I am sure that as you said someone reported you. I was also involved with PESA which is for some high revenue producing Powersellers. From what I understood is people running a large amount through paypal had an account manager they could work with. If not their should be a contact person that can give you timelines on a resolution. The reserve I am not familiar with as we ran a different business model and I do not think it was an issue.

Once thing I do know is I had a set dollar amount that once we hit that balance in the acccount e did a withdrawal and that for the most part was daily. It only takes a few seconds to do and it is worth it to reduce the risk.

For credit cards we used Authorize.net andwere able to integrate that into the backend system we were using. Not sure if that helps or not. Good luck.

[deankagan]

Originally Posted by Mitch Miller

Does anybody know at what point does PayPal start holding 10%? I currently run about 5k a month through PP. Maybe that's not enough to trigger the 10% withholding?

In regards to the business debit card, I have one and use it all the time without incident. I have often wondered if it isn't the debit card transactions that help them feel I am legit.

This chat makes me nervous as a whore in church.

Brad I am not sure it is just on a dollar amount. They are probably running some algorithm on this. I will tell you I was running $40K per month through there and more using my merchant account. I really do not remember having a reserve but maybe in the beginning of my business they did something and I cannot remember. I am sure any increase that has a trajectory to it would lght a fire under them. You might want to see if there is a paypal forum somewhere with some experienced people. I mentioned on another post the PESA organization. I have not been on their site in awhile but there are some very sharp people on there and they have some amazing discussions. It is called the Professional eBay Sellers Association. You just might be able to sign up on the site and get on the discussion board and talk to people. I will also pm you the name of someone I know that has a pretty big operation and might have dealt with this in the past.

[jamestame]

WOW that really sucks, sorry to hear that... I never thought that paypal out of all companies would do something like that, especially to a customer that was there pretty much from the start...

I would be pretty darn pissed off if that happened to me

Best of luck and i hope it resolves in your favor!

[divinewind]

I had my paypal account for 2 years and didn't use it for about a year. While I wasn't using it, something must've happened like someone stealing my paypal info and using it for some adult payment scheme, cause I didn't touch it, and then all of the sudden my account was frozen and I was banned from ever using them again.

I talked to their service, and through a lot of talking with different teams, they ended up telling me there was nothing I could do.

I even tried opening up a new bank account. They cancelled me after verification. I am quite pissed at them cause I've always been 100% legit and I read and abided by their terms of service. Now I need them and they aren't letting me do business with them nor will they provide proof it was me who did this, or allow me to discuss this with them. To do biz with them I'd probably have to hire a lawyer, but it's just not worth it right now... I use google checkout and they're great with me.

[DogScout]

Originally Posted by Samken

For a total newbie like me, what other payment processing options do i have apart from CB since paypal can't be relied on?

Most local banks have internet portals available. If you keep in touch (and smooze a little) with the local branch manager, as well as keep them informed when you expect spikes, most will work with you just fine and no freezing issues. You have to have a relationship with them, keep them informed and accept Credit cards.
Then you are good. (they will report income, so you do need to do your taxes straight, but I assume PP does as well. )

[Brad Gosse]

Originally Posted by ramone_johnny

Man this sucks. If my paypal went down Id be pushing a broom within days.

Get yourself a backup. NOW!

[Justin Mandel]

Problem: Paypal is freezing accounts.

SOLUTION: Get yourself a Paypal rep. and keep in contact with them.

End of story.

I've seen this thread appear dozens of times and the OP *never* has a PP rep - There's no need to fear PP.

[Brad Gosse]

Originally Posted by Justin Mandel

Problem: Paypal is freezing accounts.

SOLUTION: Get yourself a Paypal rep. and keep in contact with them.

End of story.

I've seen this thread appear dozens of times and the OP *never* has a PP rep - There's no need to fear PP.

Do YOU have a rep? Hook me up please.

[Justin Mandel]

Brad, of course I have a rep (who I happen to keep in fairly regular touch with)

It's not hard, just call them and get your own personal rep!

Originally Posted by Brad Gosse

Do YOU have a rep? Hook me up please.

[Dino F]

Oh Man. That really sucks Brad. How the hell do they think that you are selling ponzi schemes all of a sudden???

Well, what should we do in a case like this? There are other online banks like alert pay... But which one is good?

Greetings

[MikeZewski]

Thats nothing suprising. Paypal makes things more difficult than its worth.

[DC England]

Well, this is all new to me! I have been with Paypal for 5 years now and I don't send high volume of payments thorugh it. Could this be cause from reading your previous posts?

[tecHead]

My Nana, (rest her soul), always told me to never really judge anyone(s) until walking a mile in their moccasins. Those words of wisdom have always worked for me and I think it might apply, here.

Book Review: The Paypal Wars - Entrepreneurs-Journey.com by Yaro Starak

That link is to a review of the book, "PayPal Wars"; which is an inside account of goings on inside PayPal during their beginnings and well into their current position.

Even just the review is an eye opener for small businesspeople striving to do business on the level of PayPal.

PLP,
tecHead

[ramone_johnny]

Originally Posted by Brad Gosse

Get yourself a backup. NOW!

Yeah but what Brad? Any recommendations???

[seobro]

This one of many reasons to not use Ebay. Please remember that Ebay now forces people to use their paypal system. Before you could take a personal check or MO. Here is one reason out of many, to not use Ebay.

[Chris Cabo]

Sorry to hear that. I understand the frustration is causes. I happen to me. Make sure to give them a heads up before you launch or cause a rush of orders, payments to come into your PayPal acct. They fear people pulling a fast one.
Let me know if you have questions.
Chris

[Suthan M]

Give this a try:
Give Me Your Feedback !!

Been frozen so many times, that i wear fur jacket everytime i go online .. Doesnt faze me anymore .. lol :-)

[jbode]

Anybody have a good recommendation for another payment processor... what have you found to be the best (that only takes a small %)?

[l23bc]

you are missing the whole point to this, sorry to say

Paypal are notiorious and hold peoples money like a terrorist in iraq does to its captured.

The fact is you work to the terms and conditions of paypal, pay your money into the damm thing and then bang! your account is suspended for suspicious actitvey. so while you wait for them to clear up your customers are trying to pay you for your products...moneys been turned away and you cannot access too it either! so talk about a double sword! and if they beleive the investigation is fraudelant you lose that money also,

its been twice now it had happened to me, the first time i used to sell with my friend who is now a power seller on ebay, he sells the rare copies of star wars toy 1980 figures to private collectors and make some damm fine money off it also, plus other things, but since being a power seller he has too always go back to pp each week to say he made sales, its like paypal is like your cpa network manager least cpa managers can be more leineint and dont freeze your account,

the fact is this the paypal policy sucks big time so please dont try to defend this, i remember back in 1997 when i was involved in mlm marketing referal i was getting paid a lousey dollar per referral and even when i reach 20 sales (20 dollars) they froze my account.

today as soon as i make money i place it to a uk bank right away leaving nothing in the account, might take 4 working days to transmit but at least im saving the hassle when im paid by my networks or book business ect,

if you notice the fact that them mlm and ponzi scams never get closed down yet there main processor is paypal, yet good honest people sell products and get shut down, sucks!

andy

Originally Posted by tecHead

I don't get it.

Yes, you were inconvenienced. Yes, you may have lost some sales.

But, here you have a more than legitimate explanation of the reasoning behind their actions; yet you still bash their practices and take them as a personal attack.

You rant on here about how unfair they are. You spread biased misinformation about PayPal to the newbies on this board who look to the senior Warriors for guidance... when more than one, (including myself), senior Warrior has explained more than once that if you inform PayPal ahead of time that your volume will be changing, you will run into NO problems, (there's even a reference or two about this in this thread).

They release the hold on your account based on the merits of you cooperating with their (granted rather weighted) request. Then get pissed when they suspend your account because you try to do the unsmart thing of withdrawing all your money before the original red flag even turns to yellow... bring this thread back to life to spread more biased misinformation.

I don't get it.

Do you not see that PayPal is in the business of allowing anyone in the world; (just about); to open a virtual bank account in which to move money in and out of for FREE??

Have you taken the time to take into account the possible international repercussions and ripple effect that would ensue should PayPal take a more relaxed approach to their security?

- Money laundering
- Terrorist group funding
- Terrorist cell funding
- Insurance scams
- Money theft embezzlement

Just to name a few. I am sure everyone is much more grateful these types of security measures are in place when they don't have to worry about their local cafe getting blown up by a suicide bomber who just got funded for that last piece of the bomb through his PayPal account.

PEOPLE UNDERSTAND
It is NOT the burden of PayPal, (or any international transaction engine, for that matter) to be prudent in checking your legitimacy status.

It is YOUR burden to establish trust that you ARE legit. That's your obligation as a business owner.

Stay strong and THINK
PLP,
tecHead

[Amir.S]

Andy, your right mate,

Paypal sucks big time, my paypal account is frozen as well as I made "too much money" when MJ died I sold moonwalker dvd's and made a killing on ebay, but my accound is still frozen

I use my brothers accound as I really cant find an alternative to sh**y PP.

[George Wright]

Hi asianlunatic,

I downloaded your report and it's great. Thanks much.

I had a similar experience to yours and got the same "your account is restored." I was so Leary at the time I just cancelled my account. Then PayPal sent me an email asking me to come back. I did and I've been very cautious ever since. Your report shows me that these things happen and there are solutions and my experience was not just a fluke. Thanks again

George Wright

Originally Posted by asianlunatic

Give this a try:
Give Me Your Feedback !!

Been frozen so many times, that i wear fur jacket everytime i go online .. Doesnt faze me anymore .. lol :-)

[KristieDean]

Originally Posted by Brad Gosse

I have a merchant account now. Looking for a good processing solution.

Please post when you find a good one.

[Michael Lewis]

Wow Im glad im not the only one this happens to. I have had my paypal frozen a few times and I dont really make any money yet. Maybe $500 here and there. Somehow paypal needs to implement a system where they have a "Trusted" accounts list where they lift a lot of there holds. (Or maybe they can have the option to have a side account where you put money in a CD or something so they could take that money in the event everyone you sold a product to asks for a refund)

Any Ideas to something as good as paypal but not as strict?

The thing that bothers me most about paypal is there customer service. I never get the same answer from anyone and sometimes there english is terrible.

[edmltw]

Hey guys.. Lets say for example:

I have a a 2,000 pay slip going into paypal.

Should I:

1) Get the money in batches of 500 on day1, day2, day3 ,day4?

2) Get the entire thing, and after which, send an email to the staff of paypal informing them of the reason why you received a big influx of cash?

3) Get the money in batches of 1000 on day1, day3?

4) Any other suggestions?

[Emily Meeks]

I'm not fond of Paypal, but they are a necessary evil it seems.

I clear funds out of there regularly. I also plan to launch a new WSO fairly soon, so I have to get on the phone with them very, very soon... and of course, watch my account like a hawk.

[Michelle Adams]

Sorry to hear this happened and thanks for the heads up! It would be great if you could let us know what solution you end up with outside of ClickBank.

[Mike Anthony]

Originally Posted by Brad Gosse

I have been with them 9 years and they keep a MASSIVE 6 month rolling reserve to protect themselves. A phone call to my office could have sorted this out. I do enough volume to warrant that.

Wow! That is definitely massive. I got an email suggesting that they were going to start holding reserves across the board for digital products but only for 60 days (for my niche and yes they stated it was the nature of my business not chargebacks - never had any - or complaints - few and all resolved ).

I intend to take a look at 2checkout but so far Paypal has been pretty decent for me.

[Mike Anthony]

Originally Posted by Michelle Adams

Sorry to hear this happened and thanks for the heads up! It would be great if you could let us know what solution you end up with outside of ClickBank.

google checkout, 2checkout and Amazon payments (which is looking interesting again after a kind of relaunch recently)

[ibuyhomz]

Just go to Paypalsucks.com for tons of stories and solutions for
your very own merchant account.

[STKING]

Yeah, paypal is shutting down a number of processors, I haven't been shut down yet, but I don't use them. It's such a clunky system sometimes and I get more abandoned carts with paypal.

[Aaron Moser]

I don't understand paypal... Why aren't they held to the same rules and regulations as every other bank? They seem to be able to make their own rules whereas a federally insured bank with (FDIC) can't just randomly freeze your account and take your money.

I've spoken paypal on the phone about getting a rep and they told me that I needed business account and I must be doing high volume to be eligible for a rep.

2Checkout isn't any better either. There are horror stories of them freezing accounts and keeping money too!

[Brad Gosse]

UPDATE: I wrote a blog post about this and it got picked up by a fairly large tech blog. Then the AUP department worked with me to resolve THEIR mistakes.

My "no chance of appeal" was granted appoval.

I am active again.

I still highly reccomend you use another processor. Paypal has VERY poor business relations with their account holders. I have learned a valuable lesson with all of this.

[jacktackett]

Great thread - learned something new with the rep so will be looking into that. Here's something for those new to take away from this:

1. Paypal is not a bank - don't treat them like such.
2. They are a necessary evil starting out - lower fees than Clickbank.
3. Don't leave a lot of money sitting there for them to freeze
4. CALL them if you're going to be doing anything out of the norm (for your account) to give them a heads up. I've done this when launching a product etc.

Thanks Brad for a great thread.
--Jack

[Livefire]

First of all, I'm sorry to hear about Brad's trouble with paypal. I also believe it's the first of many more incidents to come with companies like paypal. The Federal Government is seeking more ways to capatalize on the productivity of self employed entrepreneurs like those found on this forum. Its also all about control. Paypal has probably already adopted Know Your Customer policies much like the banks are required to. Banks routinely file Suspicious Activity Reports with the FBI when unusual deposits and withdrawals are made. I wouldnt be surprised if paypal does this also. Same thing goes for transactions that reach the magic 10K amount. Transaction report is made to the Treasury Department so it can be investigated for possible money laundering, tax evasion, & ad nauseum BS...... If you control the money, you dont care about it's laws and you have the people right where you want them!

Paypal isnt going to be alone in this. Herzlich Wilkommen zur Polizei Staat Amerikas!!!! (Warm Welcome to the Police State of Amerika!)

[Livefire]

Originally Posted by Aaron Moser

I don't understand paypal... Why aren't they held to the same rules and regulations as every other bank? They seem to be able to make their own rules whereas a federally insured bank with (FDIC) can't just randomly freeze your account and take your money.

I've spoken paypal on the phone about getting a rep and they told me that I needed business account and I must be doing high volume to be eligible for a rep.

2Checkout isn't any better either. There are horror stories of them freezing accounts and keeping money too!

Paypal is in no way a bank. They are a payment processor. Banks are licensed to loan credit and have reserve requrements and the like. The banks are governed by the Federal Reserve System and agencies such as the FDIC and the SEC. BTW under certain circumstances or when certain events occur with an account, they definately can freeze an account.

Also, when you agree to Paypal's TOS, that is a legally enforceable contract and their lawyers most certainly have covered their caboose as to the legality of their seemingly "arbitrary and capricious" decisions to freeze accounts. I like the line from the original Charlie and the Chocolate Factory..... Contracts are for suckers, Wonka!!! I use them everyday!!! Mr Sault, used car salesman and Veruca's dad......

Bottom line, Paypal has a great gig going and is going to do what it needs to do to keep it going. No way do they want to deal with DOJ lawyers bringing them up on criminal charges for money laundering or anything like that. That is exactly what happened to e-gold!

[Mike Murphy]

Hey Brad, awesome that it got unlocked thanks to a highly visible blog! It's amazing that they've been able to continue on with their crappy ways.

Getting a PP rep...now there is a killer tip that I'll be acting on before everyone else jumps all over it......was that out loud?

Glad you're back up man.

[Suthan M]

Originally Posted by George Wright

Hi asianlunatic,

I downloaded your report and it's great. Thanks much.

I had a similar experience to yours and got the same "your account is restored." I was so Leary at the time I just cancelled my account. Then PayPal sent me an email asking me to come back. I did and I've been very cautious ever since. Your report shows me that these things happen and there are solutions and my experience was not just a fluke. Thanks again

George Wright

Glad that this comes of help for you.

For everyone, dont take this freeze thing personally. Take it as a challenge, and move forward positively with your business.

[Livefire]

Originally Posted by TheRichJerksNet

All earnings will be reported to the IRS ... So all those people (and there are many) that work under the table and do not file taxes are going to be in for a surprise...


James

Not only that, we will see the payment processors forced to adopt policies much like the banks have had to, in order to be in compliance with the myriad of government regulations. Stuff like Know Your Customer, Patriot Act, Treasury Dept Regs and the like. This bit with Paypal is only the beginning! Big Brother has arrived!

A US citizenship has become more of a liability than an asset! Thanks again for sharing this.

[um1001]

Originally Posted by Brad Gosse

I can't even begin to argue this with you. Fact is I have been with them since the start and was COLD CALLED to join by one of their execs.

I have had a 10% rolling reserve forever and they are sitting on huge money there.

What's so wrong with taking a withdrawal?

FYI My complaints and chargebacks are WAY below the 1% standard.

YES I am biased and YES I will tell everyone I know to RUN don't walk, leave paypal now before they freeze your account with no explanation.

I really feel your pain ... They have screwed me over more times than I care to count. I used to sell virtual currency (that is, money for online games - Everquest in this case) and I basically went bankrupt over fraudulent charges that Paypal didn't "feel" like investigating because it was digital product. I finally managed to track down their phone number (wasn't that easy back then...) and I got the same runaround on the phone.

Their policies infuriate me sometimes. It seems they lose sight of the fact that there are real people with real finances on the other end of the e-mail.