Paypal sucks. Screwed for no reason after 5 years of business... Need alternative.

[wolfmonk]

Thanks for sharing Scott.

Probably at one point in time a large biz becomes so much of a machine, so it's easier for them to rip you off than take a closer look at their own biz processes and rules.

If you prove them wrong, you'll create a precedent that they CAN be wrong... which they are not willing to accept.

[Floyd Fisher]

Originally Posted by MichaelHiles

Try Credit Card Processing, Merchant Accounts, Accept Credit Cards

Seriously. They do merch accounts with hard credit and/or tough business models.

Michael:

Do you use them?

Some questions:

1. What is the monthly fees?

2. Can I offer a 1 year guarantee on my products (I hate the 60 day limitations I have right now) with no problems?

[Chris Lockwood]

Originally Posted by koolwarrior

You're making them pay for an product that can't be accessed after they pay. If you're going to charge for something they can't get right away, it better be a physical one...or else they'll shut you down thinking you're laundering money.

Hell, if I were running a CC-like service, and I saw thousands of bucks flowing thru, and no one's getting a thing (physical/digital), I'd shut you down too, to be hoenst.

I wouldn't want the feds raiding my office over something someone was doing that NO ONE knows about.

Wow, that's over the top! Did you realize PayPal was created for the purpose of sending money to friends?

It's commonly used for paying affiliate commissions and paying for services. "Service" is even one of the categories you can choose when using the "send money" feature.

If I were selling services for 4 figures or higher, I might avoid Paypal to avoid their fees and so on, but there's nothing wrong as far as their TOS is concerned with using it for things like that.

Ditto for digital products- why would their buttons have a field for a download page if the service was not supposed to be used for selling digital products?

[Steven Wagenheim]

Originally Posted by Floyd Fisher

Steve:

If you have a bankruptcy that cleared the courts in Nov of 2002 like I do, then I'd have to give that the old Steve Austin 'hell yeah'. No merchant in their right mind would ever give me a merchant account for any amount, especially in this current credit crunch. Heck, I can't even get a retail store card like Sears, how many laughs do you think a decent merchant provider would have with my application?

Floyd, I get where you're coming from and I'm sorry to hear about the
problems you've had. Yes, in cases like this, having PayPal is a godsend.

I guess I was referring more to the "average" person or even people with
good credit. I'd have no problem getting a merchant account and yet, out
of pure laziness, have never applied for one. PayPal is just so convenient
and easy.

But if the day comes, I won't shed a tear over them. I'll just go dig up
another one to take payments.

Nobody should be able to hold a gun to your head the way some companies
do.

It just ain't right.

[MichaelHiles]

Originally Posted by Floyd Fisher

Michael:

Do you use them?

Some questions:

1. What is the monthly fees?

2. Can I offer a 1 year guarantee on my products (I hate the 60 day limitations I have right now) with no problems?

I do not currently use them. I use merch services through my bank. However, I have used them in the past for an offline business that I sort of "inherited" (bought the note, borrower defaulted on loan, repo'd the assets). My PB didn't like the fact that I intended to simply open the business with the assets and hire someone to operate it because the perceived risk was high. This was a couple of years before the economy started to slide, and this business is one of the first "luxuries" to get axed out of a budget So, not only did I not get any LOC to support the operation (I never sign personally for any business deal with a corp or LLC in place), they wouldn't even underwrite the merch services on the deal.

So, I funded the whole thing out of pocket. A couple years after having sold the operating business to another investor, and replacing banking relationships with one a little more in tune with my own entrepreneurial attitude (and not on the federal bailout nipple I might add), I am more than thankful that this company was around to fund a startup with no business credit.

IIRC, it was about $50 a month for admin fees. The cost per transaction was pretty reasonable, but high comapred to other merch accounts. Not even close to PayPal's hijack.

Good company, no issues. But then again, you don't get many chargebacks against $4 lattes and baklava slices.

[Chris Lockwood]

Originally Posted by Burt Carpenter

Internet Marketers have embraced PayPal because they were fast and easy to set up the accounts. Outside of E-Bay Paypal is NOT the preferred way to pay by most consumers.

Where did you get this info? It's not consistent with my own testing and general knowledge that many consumers LOVE buying with Paypal:

1. They don't have to give their CC info to the seller. This seems safer and is much faster than typing all that info every time.
2. They can buy with funds in their account rather than just a CC, such as a bank account transfer.

If what you say is true, why are more and more major companies (who already have their own merchant accounts) accepting PayPal? Why did Clickbank start accepting PayPal after many years? It must be because they thought it would increase sales- certainly the fees are higher than they pay for their regular merchant account.

For anyone having trouble, have you verified everything with PayPal (your street address, phone number, CC info, bank info)? That helps a lot in keeping your account un-frozen, because it reassures them who are.

[Steven Wagenheim]

Originally Posted by Sid Hale

There is absolutely NOTHING illegal about Paypal, or even an FDIC insured bank, earning interest on monies in your account. Both Paypal AND your own local bank do it every day.

Sid, while I loved your post (gave you a big "thank you") there is one big
difference between your bank and PayPal.

Your bank isn't going to tell you that they don't want your money anymore.

At least I've yet to find a bank that has.

[valerieSONORA]

And real banks give u suckers or tootsie rolls when u go there. Paypal doesn't do that

[Razer Rage]

Originally Posted by valerieSONORA

And real banks give u suckers or tootsie rolls when u go there. Paypal doesn't do that

The one reason why banks will ALWAYS be better than paypal by far.

[Rick Wilson]

Originally Posted by garyv

Also they have been sued in the past for this same reason, and I think that they've changed up their TOS just enough to keep them out of trouble for continuing to do it.

E-Commerce News: News: PayPal Users Sue over Frozen Funds

Keep in mind that THAT article was back in 2002. I believe that was before eBay bought PayPal. The TOS has been changed around a bit since then, I'm sure. eBay is "deep pockets" and they know they can outlast most people's legal fees.

PayPal did lose a couple legal battles around that time and had to payout to some account holders in a class action award. I know, because I received a few hundred dollars in my account for my share.

To this day my attorney (a great friend of mine since high school) STILL shakes his head at PP's TOS and can't believe anyone (and me) really uses them when PP has the upper hand.

I personally don't like PayPal and hate being forced to use them but reality sets in. Fortunately, most monies I receive thru PayPal are affiliate commissions. I'm basically an affiliate marketer and I don't have many of my own products to sell so this doesn't necassarily impact me as much as someone who has their own products.

Like previously suggested by others, I do regularly withdraw monie from PP to my bank account. I have what I call my "throwaway" bank account. I withdraw from PP to THAT account and then take almost ALL monies out and put in my regular bank account. A pain to do it that way but PP can't take any money back from the "throwaway" account as nothing much is there. ;-)

I wish you luck in getting it straightened out.


Rick Wilson aka CorpRebel

[stevenh512]

Originally Posted by Rick Wilson

I'm basically an affiliate marketer and I don't have many of my own products to sell so this doesn't necassarily impact me as much as someone who has their own products.

Actually I'd think it would impact you worse than someone who has their own products. If you have your own product and you lose your Paypal account you always have the option of moving on to other services (Clickbank, 2CO, your own merchant account). If you're an affiliate marketer, unless you're dealing with a company who's willing to pay you by check or direct deposit, you lose your Paypal account and you're dead.. at least until you can set up and verify a new one (assuming you don't get caught by Paypal's "duplicate account filters" and shut down immediately).

[SimonHarrison]

Personally I detest Paypal, their so called payment protection does nothing but favour conmen, their support is awful, their charges a mickey take.

The problem is I will continue to give them thousands of dollars a year in revenue because my customers demand that Paypal is available as a payment mechanism.

I would LOVE to turn off Paypal tommorow.

Awful company in every respect IMO.

[IMDimWit]

This definitely sucks and is very frustrating. But, it begs for everyone to have a backup plan and maybe two.

[D.lee]

Hey Scott thats sucks with the paypal nightmare Im just starting some ecom sites thanks for the heads up on paypal I have sign up for a free merchant its good so far and its free rockettheprofit.com/instantmerchantaccount Free Merchant Account Sign-Up Video[/url]

check it out let me know if it worked for you

[Patrick Judge]

I do believe paypal makes millions from frozen accounts, they have just invested 50 million euro in a plant here in Dublin Ireland, so there you go !

[Mike Hill]

Originally Posted by Steven Wagenheim

Sid, while I loved your post (gave you a big "thank you") there is one big
difference between your bank and PayPal.

Your bank isn't going to tell you that they don't want your money anymore.

At least I've yet to find a bank that has.

Well hold on a second Steve... I know for a fact that Banks can terminate their relationship with a customer if they are deemed "High Risk" and have done some stupid things like "kiting" (but then again that's not the issue in this case... never mind )

I know this to be true because my wife works at a bank.

When I told her about PayPal she said 9 times out of 10 the person is not telling the whole story. She see's it everyday... but who am I to judge?

Mike Hill

[esr]

Originally Posted by scottspfd82

UPDATE:

After HOURS of talking to several Paypal reps, here's the verdict...

Their fraud team has determined that I pose a "high risk"...

I went all the way up the customer service chain. The lady I talked to was nice and understanding...

I said "So, you're telling me that after 5 years of being a loyal customer... Who stays well within acceptable use policy, who has had thousands of dollars every month going through their account for years without issue, that you're shutting my account down and not even giving me a reason why?"

The answer was basically "Yes, that's right".

I had her manually go through my account activity for the last few months. I asked her to point out anything that may have raised a red flag. She said the account looks perfectly normal... No disputes or claims...

So I asked who to talk to about reviewing my account and being considered to have it reinstated...

The answer was that the decision is made by the fraud team, and that all decisions are final.

Bottom line, I am permanently banned from Paypal for no apparent reason...

I found out through some research that all accounts are manually reviewed by fraud specialists, and the ultimate decision is made by an individual.

There is no way to contact these people for a reason why.

I HIGHLY recommend everyone who relies on Paypal to get a backup plan in place TODAY.

Believe me, Paypal accounts don't come any lower risk than mine. I wasn't doing anything even remotely "shady" and I have years of history with them. If you're thinking "it won't happen to me" don't bet on it.

-Scott

After reading this reply from Paypal, NOW I'm worried.

I used to work in the fraud department for Cingular Wireless. "Suspicious" accounts were brought to our attention via a software program, not a person. If an account fit the criteria for a "red flag" we had to investigate it.

And, it was up to ME to cancel a cell phone account or not. I had no experience, was making a mere $14 an hour and had the power, with the click of my mouse, to cancel someone's cell phone account with no supervisor input or questions asked.

If I was in a bad mood, or had just had a customer yell at me, do you think it NEVER played into my decisions?

Scary that it sounds like Paypal is doing the same thing, but with something much more important than a cell phone account.

Thanks for the heads up Scott, and I am truly sorry this happened to you.

[Doug English]

Originally Posted by scottspfd82

UPDATE:

After HOURS of talking to several Paypal reps, here's the verdict...

Their fraud team has determined that I pose a "high risk"...

I went all the way up the customer service chain. The lady I talked to was nice and understanding...

I said "So, you're telling me that after 5 years of being a loyal customer... Who stays well within acceptable use policy, who has had thousands of dollars every month going through their account for years without issue, that you're shutting my account down and not even giving me a reason why?"

The answer was basically "Yes, that's right".

I had her manually go through my account activity for the last few months. I asked her to point out anything that may have raised a red flag. She said the account looks perfectly normal... No disputes or claims...

So I asked who to talk to about reviewing my account and being considered to have it reinstated...

The answer was that the decision is made by the fraud team, and that all decisions are final.

Bottom line, I am permanently banned from Paypal for no apparent reason...

I found out through some research that all accounts are manually reviewed by fraud specialists, and the ultimate decision is made by an individual.

There is no way to contact these people for a reason why.

I HIGHLY recommend everyone who relies on Paypal to get a backup plan in place TODAY.

Believe me, Paypal accounts don't come any lower risk than mine. I wasn't doing anything even remotely "shady" and I have years of history with them. If you're thinking "it won't happen to me" don't bet on it.

-Scott

Damn Scott...I had this EXACT same conversation with several Paypal reps a few years ago. And I mean EXACT. Its like a bad rerun of an old twighlight zone episode.

Everything is the same...I had a 6 year business account in good standing, the people I talked to looked at my account and a couple even said they were 'very surprised' that this happened, but unfortunately they couldn't do anything about it because it was in the AUP's hands now.

And of course, you can't talk to the AUP department on the phone...only via email, and they definitely won't respond to any emails.

Its almost scary how identical my conversations with them were. Spot on.

Anyone who gives you the old 'well, where there is smoke, there's fire, you were doing something wrong' crap just doesn't really know whats going on. I used to think the same way until it happened to me. They'll continue to think the same way until it happens to them. Its human nature.

Its pretty much their automated spam filter. As anyone knows, even legit emails get caught in spam filters. When it does, you are toast, no questions asked, do not pass go, do not collect $200. People just can't comprehend this until it actually happens to them. Until then, they will of course say that there just has to be more to the story than you are giving.

And the WORST responses are the ones who say "Well, I have my own Paypal rep. I just call them and they take care of everything".

Sorry to say, thats not the case. Once you get the ban hammer, you do NOT have a Paypal rep, period, end of story.

[Floyd Fisher]

Originally Posted by Steven Wagenheim

Floyd, I get where you're coming from and I'm sorry to hear about the
problems you've had. Yes, in cases like this, having PayPal is a godsend.

I guess I was referring more to the "average" person or even people with
good credit. I'd have no problem getting a merchant account and yet, out
of pure laziness, have never applied for one. PayPal is just so convenient
and easy.

But if the day comes, I won't shed a tear over them. I'll just go dig up
another one to take payments.

Nobody should be able to hold a gun to your head the way some companies
do.

It just ain't right.

Steve:

Just remember there is always 3 sides to every story: My side, your side, and the truth.

Right now, all we have to go on is the OP's side of the story here. We really haven't heard paypal's side of this equation, so we don't know what they are thinking, or why they think that way.

It could be something totally fraudulent, or it could be a legitimate concern they have. Without any input from paypal, we don't know all the whats and whys behing the freezing of the account, and how to avoid getting yours shut down.

Why is that? It could be fear that if real fraudsters found this out, they could structure their transactions to avoid detection. Or it could be they have something to hide, and random account freezes are part of their business model.

Paypal, if you're reading this, we need you to become tons more transparent about this stuff. Stop making decisions in smoke filled back rooms, and step out into the light and tell us what is going on.

The alternative is six million people mail-bombing congress, and you getting perp walked in front of them and raked over the coals for public pleasure.

Your move paypal. You can either work with us, or we will work you over in the end.

[Justin Mandel]

This the perfect example of why you NEED to be in contact with your Paypal rep.

Don't have a rep?

Contact them and get one!

For example I have a launch coming up and Paypal should see a flood of money coming into my account all of a sudden which might raise some eyebrows.

So what will I do between now and then?

You guessed it, contact Joe my Paypal rep. So they know what's about to happen and I prevent any obvious misfortunes.

Lessons to be learned:
1) Get your own Paypal rep.!
2) Have a back-up plan!

[multimastery]

Sorry to hear the news about PayPal! I will most definitely take heed to your warning. If you can round up about a dozen other folks that this has unfairly happened to, it sounds like this would make for a good Class Action Lawsuit. You should really think about it because you could very well get far more money than their holding from you!

[Scott Murdaugh]

When I told her about PayPal she said 9 times out of 10 the person is not telling the whole story. She see's it everyday... but who am I to judge?

Here's a thought. I earn a living by helping people in this forum. Do you think I'd start a thread admitting I had my Paypal account canned if I wasn't telling the whole truth?

How does starting this thread make ANY sense at all if I'm hiding anything? I rely on people to trust that I'm a good person, that I'll do a good job, that I always work with their best interest in mind...

Anyone who I've ever wronged, through Paypal or otherwise, is free to comment here. I don't see any, do you?

I would be an idiot to post here if I had something to hide, over 2,000 people, 2,000 potential clients, have seen this... And I'm not an idiot.

I'll be transparent...

I had thousands of dollars coming into the account and I routinely withdrew the money... So at the end of the month I may have $2k-$3k instead of the original $6k or whatever...

Maybe I am at fault, I dunno. I'd LOVE for a Paypal rep to come in here and give me a specific reason. I've emailed them and showed them the thread.

But you don't know me, you and everyone else who have said "you're hiding something" are wrong...

If I was "hiding something" then posting this in a public forum for thousands of people to see would be stupid...

And I'm not stupid.

Peace,

-Scott

[Karen Blundell]

I have known other people who have had their accounts frozen and locked just like Scott's and those people who have posted. I think what some people have said here is wise: when it comes to your money don't put all your eggs in one basket. Along with having multiple streams of income, have multiple ways of receiving money in place. Use AlertPay or other payment processors, or get a merchant account if you can.

[bellis160]

Scott, so sorry to hear about your Paypal problem. I am completely convinced you are telling the truth. And at the same time I think Paypal is justified in taking the action they did.

Paypal deals with billions of transaction by millions of customers. They do their best to set up systems and procedures to deal with fraud. But there is no way any large company can sort the fraudulent accounts from the legal accounts with 100% accuracy.

Every company this large has do to the same thing in order to stay in business. They set up rules to determine when account activity is suspicious. Then flag the account and sent it to the fraud department. Where someone will quickly determine the risk to the company and then make a decision.

Once a final decision is made there is nothing the company is willing to do to change it. Not because they don't believe you. But because it is not cost effictive to investigate it any further.

Nearly every customer who's account gets flagged as "high risk" will want to contest it. But the company cannot commit the resources to listen to every case. The cost would be unacceptably high.

Instead they flag the "high risk" accounts knowing full well a percentage of them are perfectly legit. They accept this "breakage" as a cost of doing business.

This is the only way a large business can deal with millions of customers. I worked in management for a Fortune 50 company, most of those years in customer service.

This is something we saw often. And I have been on the other end of the conversation you had with Paypal too many times.

It doesn't make any sense to the customer when they hear nothing can be done once the decision has been made. But in truth it is a business reality.

The only options left for you Scott are to file a complaint with any overseeing government regulatory agency and/or sue them.

[valerieSONORA]

Can you get another bank acct. and use another email and open a new PP acct. if you need to?

[Doug English]

Originally Posted by valerieSONORA

Can you get another bank acct. and use another email and open a new PP acct. if you need to?

That doesn't really work anymore, since they now require a credit check for all new premier or business accounts, which means they need your SSN.
If they didn't have your SSN on your old account, you could do this once, but thats it.

And on a side note, to all those who say "just don't keep any funds in your PP account...make sure you xfer them immediately", that doesn't work either. When you sign up w/ them and add your bank account, you are giving them permission to withdraw any 'chargeback' funds directly from your attached bank account.
This is the 'rule' that the Stormpay crooks used (more like abused) to drain people's attached bank accounts.

[Spiritjoy]

Hi Paypal did something like this to me. I had a sale for $1,500 dollars not really IM just on a sale of a physical product on ebay, After 3 weeks the person decided they wanted their money back.

There was a clear no refund policy. Paypal said my money was safe and that I was in the right, just fax the no refund post that was on ebay, which I did. Her credit card said they will take her side and will ask paypal for the money back.. After paypal said I was covered by paypals insurance i did not feel good about paypal even though they said I was in the right .They said the $1,500 was mine I would not have to give the money back. I took out $500 out of my paypal account leaving $1000
10 days later paypal seized the remaining $1000 that was left in my account and told me I had to pay them the $500 dollars that i withdrew!

I said you said I was protected and was in the right...no answer from them ..just a closing of my account after 4 years and they took the 1,000 dollars from my sale that was left in my account

[Spiritjoy]

I still use them but after any sales take the money out quickly because they will close your account without telling you AND keep whatever money is in the account it happened to me

[Andrew Maule]

Here's a kick ass idea:

Keep using Paypal but transfer chunks of money from PP to your bank account weekly or even daily. This way you'll never have all your eggs in one basket and you can have your bank account to fall back on, this is what I'm starting to do since I'm accumulating larger amounts in my account I don't feel comfortable risking a "freeze" with...

[OmarMartin]

Dude...

Don't even get me started on this topic! I was recently a victim of fraud... Try this one on for size... A bunch of hackers ran a phishing scam for cc#'s then they sign up as affiliates to sell several of my products through a widely known affiliate management site. Next they start buying the products through their own affiliate links with the stolen card #'s!

I caught on within 30 days and I banned them as affiliates but not before I had payed out a bunch of commissions already. Then I began refunding the unsuspecting cardholders their money. Within the next month the chargebacks began coming in. And guess what.. PAYPAL would honor them EVEN THOUGH I ALREADY REFUNDED THE MONEY. So I took a double dip on many of these.

Not to mention that paypal tacked on a sweet little charge back fee for everyone of these transactions. Calling PayPal support is like reasoning with a broken parking meter. They have absoulutely no clue of what internet marketing is. If it's not Ebay.. they just dont understand it.
I got absolutely no where with them, I spoke to several reps and 2 different supervisors and the only thing they kept saying was "This would never have happened if you were using "our" payment buttons.

Duhhh... you're payment buttons are static and don't let me track affiliate sales! The just have no clue over there. Unfortunately they are SO BIG now that they can get away with these ridiculous powermoves now. But fortunately for us there are well respected alternatives like Authorize.net and a few others.

All I wanted paypal to do was get me back the affiliate money that I paid these clowns (through paypal) or at the very least cancel their accts... their response to me "Those users have not violated our policy by simply accepting a payment from you." WHAT ? ! ? OHH NO YOU DIDN'T
So I'm the bad guy now?? wtf?

I've dusted myself off after the $13,000 loss and moved on. They may think they hold all the cards but reality is that I carry my own deck. I'm in control of my business not paypal.

Peace,
O

[kdsm100]

I'm a "newbie" and haven't been on the Warrior Forum in a while due to travel and time constraints, but I read every word of this thread because it's a "hot button" topic for me. I've never accepted payments through PayPal but have heard all of these stories in other places as well. My experience is with Merchant Service Providers, but it is similar and for those who want to abandon PayPal and get your own Merchant Account this is particularly important information.

My main business has been accepting credit cards for payment for over 18 years and although most of you are in an online environment my business is what used to be called "mail order" or now "direct mail" which has the same challenges and constraints as online businesses because we never have the credit card in-hand.

I've always watched our rates closely as our business operates on a very low profit margin and giving away any of it is difficult to accept, especially just to get our payment. And as our business grew I found out more and more about how to get better rates and how the whole thing worked.

Then last year someone whose Forum I follow and participate in posted a rant about exactly what happened to Scott, but it happened to her merchant account, not PayPal. So I obviously was concerned. We process over $1.5 million a year in credit card transactions and I couldn't believe they could take her money and then tell her it could take up to 180 days for them to resolve the situation. That would be catastrophic for our business.

And then in talking to a friend with a retail, brick and mortar business I heard another horror story. For them, not only did they get talked into changing their merchant provider which actually cost them twice as much in fees as their previous one, but the sales rep also convinced them to lease a new terminal in order to get "better rates." A $3,000 lease for a terminal that could easily be bought for under $200.

I'm an self-admitted "information-aholic" and I set out to find out what had happened in both cases, if it could happen to our company, and more about the industry itself.

It's not a pretty story...a lot of horror stories, rip-offs, frozen accounts and on an on. Now I dig deep and follow links and leads and this took me several weeks. But this is a very unregulated industry and there are a lot of unethical people and companies out there.

I finally found four merchant service providers that I "thought" were potential winners. But that's when I got serious about my due diligence.

So I looked into applying to become an independent agent with them...best way I could think of to find out the "real deal." Two had them made it relatively easy to get this information and I got the paperwork, etc., just to see what kind of compensation they offered their independent sales people. It was an eye-opener! One company quoted their rates and they actually said "you can mark it up whatever you can get and keep the difference." And the leasing of terminals? Yup, they gave bonuses for selling those outrageous leases. Crossed them off the list.

I paid for Dunn & Bradstreet reports on them - one of the ones I had really been considering had a history of not paying their employment taxes to the IRS and there were liens against them. Crossed them off the list.

That left two companies. I couldn't find anything negative about them and so I contacted both and submitted my company's information to get quotes for switching our business to them.

They were both very good to deal with. Their quotes were similar. I got to talk with real people, the same ones every time. I quizzed them both about the situations that had started me on this journey and they both explained why that could happen and why it wouldn't happen in dealing with them.

Bottom line there was a big deciding factor for me in choosing to move my business to one of them over the other. Their rates had been similar, but one of the guys told me "I don't understand something about your current statements. All of your transactions are going through as "unqualified" which means you're getting penalized and it looks like it's costing you about $900 a month." I immediately spoke to my employees and it turns out that there was an "upgrade" made to our terminal and the trainer told them to "just hit the return key" when any information such as zip code, etc. was asked for. That put every single transaction into a non-qualified situation and cost us plenty!

So the decision came down to going with the company whose rep was not only concerned with my rate, but was truly concerned about my company even though at that point he didn't know if I would select them. Good old-fashioned customer service even before you've gotten the customer. It's the way I do business.

I called and spoke to the head of the company to tell him how impressed I was; we still correspond and talk occasionally. And I e-mail and talk with my rep regularly.

Not to step on any toes, but I noticed that the Merchant Account Provider (as someone in the thread pointed out) that some big names in the internet world recommend have an "affiliate program" associated with it. This isn't necessarily bad in any way, but it shouldn't keep you from doing your due diligence on your own. Referrals are a great starting point, but look into the company just as thoroughly as you would had they come knocking on your door.

[doctfeelgood]

Originally Posted by artwebster

PayPal is regulated by the FSA (Financial Services Authority) in the UK so UK customers have a powerful ally in such an event - is there no similar regulatory body in USA?

Also, since PayPal are the ones claiming that 'risk' is the problem, they need to substantiate that risk. It isn't as though they have suddenly decided to close your account. The email quote indicates that they are prepared to carry your business until you find an alternative payment processor but that the risk inherrent in their business with you is too high for them to entertain.

Maybe there are aspects to your business that experience has shown them are unwise. The 180 days delay in passing on payments to you is an indication that they are expecting to see a major refund level. This in itself would not normally be assessed as risk but they obviously also feel that the refund level could also affect their own position in the market.

It is worth sending them an email copied to a lawyer asking them to clarify their position.

Up until last October Paypal was not regulated by the FSA in the UK? A client of mine had more or less the same issue as Scott and they just freezed his account and held his money for 180 days. The reason they hold it for this length of time is that if a customer wants their money back they have to pay it back ( paypal does if six months or before) if it is longer then six months and up to 12 months the credit card company guarantees the payment if the seller is not available.
When i found out that paypal was not regulated it made me realise that if they suddenly decided to keep everyone money and do a runner you would not stand a chance in getting your money back. Caveat Emptor!!!

[Jay Sullivan]

Google checkout is a good option, i would never leave that amount of money in paypal anyway...transfer everything to your bank...that way they can't get their grubby little hands on it....

But, best of luck to you in finding another alternative, paypal is needed sometimes, especially for places like the warrior forum, what happens when you want to run a wso...you need paypal!

I wonder if Allen would accept other means of paying for WSO's?

[tecHead]

Originally Posted by Scott Murdaugh

....

The only weird thing that happened, I got an email this morning from a customer I had over a year ago. He asked why I sent him an invoice... I hadn't sent him an invoice...

-Scott

Seems to me that this is what raised the red flag(s).

You may not want to hear this.. those that are convinced that PayPal is out to get them; (even though they've grown consistently over the past decade -- and they couldn't do that without people actually using them for more than just sending funds to friends); may not want to hear this.... but...

Unless you can show a distinct two way paper trail of all your transactions; anything can be deemed fraud and/or high risk. There's no accounting; no records.

Many people make the mistake that their PayPal transaction history is their record; but its not. The PayPal history is a reference to each transaction.

This is why they give you the facilities to invoice people. AND they provide seller protection on digital goods IF you ONLY accept payments from individuals with their address verified with PayPal.

The amount of a transaction doesn't trigger an action from the risk department; only a flag. If the basic diagnostics does not return the proper data to change that red flag to a yellow flag.. then probability management takes over.

Unfortunately, the probability that you're a scammer of some capacity is greater than that of you being a legitimate business model. Therefore, it is up to you, (since its your business), to differentiate yourself from the average scammer. PayPal gives you the facilities within their system to help you do this.

- Verify your address(es)
- Verify your phone number(s)
- Verify your email address(es)
- Attach & Verify your bank account(s)
- Attach & Verify your CC (can also be a bank debit card with a Visa/MC logo)
- Accept transactions from ONLY those with verified information in their PayPal accounts
- Do NOT accept eChecks
- Allow for 'PayPal Account creation optional'
- Enable 'auto-return'
- USE the IPN services as another source of record keeping outside of PayPal
- Participate in the PayPal (balance) money market fund (they actually pay you)

And if you're still paranoid; do weekly withdraws to the same bank account, (as another level of security you can transfer those funds to another account within the same bank using the banks system).

The only thing wrong with PayPal is the fact that they don't fully explain all of the ways to safeguard yourself, your money and your account with their settings.

It would be best for everyone using PayPal to simply go through their account settings and set your accounts up so that YOU are "accepting" the least amount of risk. This is the first way to keep you pretty much under the risk management department's radar.

Another mistake many of us make is thinking we should receive some type of preferential treatment just because we're a long standing customer; even if that preferential treatment puts the business giving the preferential treatment to us at risk... and if it got shut down by the Govn. due to giving out such preferential treatment we'd just turn our heads to the next business and shrug it off as "not my problem".

Yet, put yourself in the shoes of PayPal. Would you take on the extra customer service liability giving out preferential treatment to every Tom, Dick & Harry or would you dole out undercover premium level customer support to those that were proactive enough to seek it out?

[viteshb]

I heard stories like this alot, it scares me and i think i have to look for an alternative nowadays

[Rod Cortez]

Originally Posted by valerieSONORA

And real banks give u suckers or tootsie rolls when u go there. Paypal doesn't do that

I'm still waiting for my free toaster.......

[FriendlyRob]

Who hasn't been screwed by paypal at one point or another.

To me it just means that I'm doing enough business to get screwed once in a while.

[DAS_Matt]

Ouch. Sorry to hear.. hopefully you can get it settled. I personally would make it a point to call incessantly until you got a straight answer.

[sbucciarel]

Originally Posted by Chris Endres

Hate to point out the obvious but WE ARE WARRIORS

Why not organize as a group and start showing PayPal some of our muscle?

We are capable of generating so much influence that even PayPal could shudder...

Not really. They could care less. The WF is big but not big enough to influence Paypal