Inquiry By PayPal

Adam B

14 years ago

Ok just seen this:

Inquiry by PayPal - Topix

It appears Paypal Keep the money?????

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craigbrown

14 years ago

Must be part of their quarterly investigation cycle. Another blog I read called Cryptome has had a similar thing happen to them in the past few days, but more permanent. In their particular case, the money is being kept for 180 days.

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mikeyman120 14 years ago

Looks like another story for these people

PayPal Alternative - Pay Pal Lawsuits, PayPal Complaints & Fraud

Mike
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- Kay King 14 years ago
  
  He has phoned paypal and they tell him that his paypal account is locked down and frozen for 6 months
  
  What country does he live in?
  
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craigbrown

14 years ago

Thanks for that link Mike, interesting reading.

I've never had an issue with paypal since they started, but I'm starting to think of a possible "workflow" to avoid getting your cash locked up for six months.

1. Withdraw paypal funds to your bank account once every week

2. Transfer those monies to another bank account the same day they come in to prevent Paypal from cleaning out your bank account if they get skittish

3. Rinse and repeat

It seems they are getting more and more skittish all the time, to the point where I'm seriously looking for alternatives - lack of accountability and a "screw them" attitude built into their respective business models and corporate culture will see both paypal and ebay fail. Sad, but sometimes you've got to clear away the dead wood.

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Dalun

14 years ago

is there any special reason for paypal to do this?

now im worried that paypal might lockdown my account for whatever reason they see fit. paypal is where i receive all my online money making money. this would seriously crush my business.

would anyone know of any alternatives to paypal? cause im pretty sure that paypal has dominated this market.

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Emily Meeks

14 years ago

Originally Posted by Dalun

is there any special reason for paypal to do this?

now im worried that paypal might lockdown my account for whatever reason they see fit. paypal is where i receive all my online money making money. this would seriously crush my business.

would anyone know of any alternatives to paypal? cause im pretty sure that paypal has dominated this market.

Alertpay is a viable alternative, though it hasn't 'caught on' as heavily as Paypal.

I second craigbrown's suggestion, however. So long as you transfer to your bank account, and transfer to another bank (to which Paypal doesn't have access), you'll be fine.

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Dalun

14 years ago

so what kinda resources would you require to start a site as an alternative to paypal?

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craigbrown 14 years ago

Originally Posted by Dalun

so what kinda resources would you require to start a site as an alternative to paypal?

THAT'D be a WSO and a half. LOL

If ebay didn't exist, paypal wouldn't be as huge as it is now. I guess someone could try and repeat the ebay/paypal magic trick, but it would take years to gain momentum. The market is definitely there though, everyone knows someone who's been screwed over by paypal. They'd drop paypal in a heartbeat if there was a viable alternative.

Corporates clearly can't be trusted with this sort of power without hardcore and enforceable accountability regimes built in. That leaves either a government controlled system (which would suck) or an open-source decentralised model which would be very difficult to secure against fraudulent activity.
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JustVisiting

14 years ago

Usually this type of problem is compounded because PayPal REFUSE to communicate with their customers so It's difficult to know what they are disputing about these transactions.

Here are some links that may be of interest:
Google

Paypal Problems, Information, Issues, Class Action Lawsuits - legal actions

PayPal alternative:
Free Merchant Account, PayPal Alternative, Credit Card Processing - Home

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Paleochora 14 years ago

Originally Posted by JustVisiting

PayPal alternative:
Free Merchant Account, PayPal Alternative, Credit Card Processing - Home

This is funny. This site looks like it was put together by a 5 year old, and they want us to trust them with our money!!

Paypal has many flaws but, really, there are some other serious players out there...AlertPay being one.

Having said that, who is to say that 'Paypal alternatives' do not have draconian and arbitary powers over your money in the same way. I guess we should always read the smallprint.
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- JustVisiting 14 years ago
  
  Originally Posted by Paleochora
  
  This is funny. This site looks like it was put together by a 5 year old, and they want us to trust them with our money!!
  
  FYI: National Merchant Bancard is a registered MSP/ISO of HSBC Bank USA
  
  mmm...PayPal or HSBC...??? I know who'd I'd rather entrust my money to.
  
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linkbeasts

14 years ago

This ... is ....so not good.

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craigbrown

14 years ago

Don't expend too much energy worrying about it guys, just develop some procedures to put in place so as to minimise any potential risk of not being able to access your funds.

There's no real viable alternative to paypal for most of us, therefore we just have to be smart about limiting the amount of damage they can do.

The chances of your account being locked are negligible.

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Cray

14 years ago

I go for paypalsucks dot com when I have some free time. Reading all those horror stories gives me the shivers to put all my funds at paypal's hands. I heard something called "The paypal mafia" where they take the money when you receive or whenever you have $2k in your account. They require some impossible documents. Oh well.

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AndyBlackSEO

14 years ago

Surely they have to give you a reason for this. They offer a service and providing you are trading via the rules your funds should always be safe and accessible.

I have a decent sixed wedge in Paypal right now and reading threads like this one makes me think I should be transfering funds as they come in.

Not good.

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Kay King

14 years ago

I notice my question about location was not answered.

Here's what I've seen several times recently:

-Marketer is in a country that paypal does not accept.

-Marketer gets a US address to use from some "get US address" site online

-Marketer then starts to use paypal with that address

-Paypal asks marketer to provide proof of address - and he can't because he doesn't live there

Account is frozen. If you were less than honest with Paypal - that's what happens when you get caught. If you weren't doing anything wrong or giving false info - you can provide the proof and your account is unfrozen.

Not saying that was the case here - but it often is in threads where no one answers the question "where do you live". The "six months frozen" is a consequence often imposed by PP for giving a false address.

Paypal will freeze an account if they believe there is any deception associated with it. I think we are seeing the "inquiry" more often now because so many from non-paypal countries are coming into IM and providing false addresses. I'm sure there are mistakes made by PP, too.

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Adam B

14 years ago

Originally Posted by Kay King

I notice my question about location was not answered.

Here's what I've seen several times recently:

-Marketer is in a country that paypal does not accept.

-Marketer gets a US address to use from some "get US address" site online

-Marketer then starts to use paypal with that address

-Paypal asks marketer to provide proof of address - and he can't because he doesn't live there

Account is frozen. If you were less than honest with Paypal - that's what happens when you get caught. If you weren't doing anything wrong or giving false info - you can provide the proof and your account is unfrozen.

Not saying that was the case here - but it often is in threads where no one answers the question "where do you live". The "six months frozen" is a consequence often imposed by PP for giving a false address.

Paypal will freeze an account if they believe there is any deception associated with it. I think we are seeing the "inquiry" more often now because so many from non-paypal countries are coming into IM and providing false addresses. I'm sure there are mistakes made by PP, too.

The guy who Im speaking of is in the UK with a UK address. His address has also been "confirmed" with his credit card that is registered to Paypal.

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Kay King

14 years ago

Adam -

Now, that is interesting. I've seen PP freeze accounts for "inquiry" but not for specific times of 6 months or whatever unless there was some problem.

More often, it's frozen until the account holder provides info requested by paypal. That is indeed very odd.

kay

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Adam B

14 years ago

Originally Posted by Kay King

Adam -

Now, that is interesting. I've seen PP freeze accounts for "inquiry" but not for specific times of 6 months or whatever unless there was some problem.

More often, it's frozen until the account holder provides info requested by paypal. That is indeed very odd.

kay

His account is shut down for good like mine was in the video but his is not asking for any documents at all just 11 transactions all "Inquiry by paypal" and account then instantly closed because of "High risk" no documents requested nothing.

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Adam B

14 years ago

Apparently payments to Clickbank, Skype and other ebay members are of "High Risk" Also selling on Ebay and receiving money with Paypal is also of "High Risk"

If its so high risk to sell on ebay and to spend your own funds then why do ebay recomend Paypal???

I have actually had this myself with several of my own paypal accounts but its just a shame that this guy I have been mentoring has bought from me and others and every payment has "Inquiry by paypal" next to it. 11 transactions. Rediculous.

I actually made a video about this a year ago when I had problems with my account:

YouTube - Paypal Is A Scam Part Two

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Kay King 14 years ago

then why do ebay recomend Paypal

Because they own it. Ebay purchased paypal for 1+ billion quite some time ago.
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Adam B

14 years ago

I didnt think Paypal did these things so much now. After having those problems with my accounts last year I now set up accounts in Limited Companies as business accounts.
I just hadnt heard of this "Inquiry by Paypal" action against payments??

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TomGR

14 years ago

Originally Posted by Adam B

I didnt think Paypal did these things so much now. After having those problems with my accounts last year I now set up accounts in Limited Companies as business accounts.
I just hadnt heard of this "Inquiry by Paypal" action against payments??

Maybe they just have you on file and keep doing that to you?

Thomas

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cellcom 14 years ago

Withdrawing the money is only a temporary fix if you get into this situation - if paypal does reverse the original payment (whether it is a refund/chargeback/dispute/fraud) they will take the money back - if the withdrawal is pending it will be reversed - they usually will not take money from your bank/checking account after it has been deposited, however, they will take any available balance from your paypal account and your account balance will go negative if there is not enough balance there. You will have 7 (or 10) days to bring the account positive or paypal will probably shut down the account.

My advice to everyone (I am a power seller on ebay and have been selling on ebay for 10+ years) - do not accept any 1 (or series of payments from 1 individual) that you cannot afford to loose. If you do not believe me just do a google search.

As the earlier poster stated - because of their "monopoly" like status they can get away with doing certain things and still stay in business
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Adam B 14 years ago

Originally Posted by TomGR

Maybe they just have you on file and keep doing that to you?

Thomas

They havnt done it to my accounts since the last one in the video which was a year ago. I try not to use Paypal but sometimes have no choice.
The account Im referring in this discussion here is not my account. Yes the owner has made 2 payments to one of my business accounts but the rest of the payments are to clickbank and skype and other ebay members so its got nothing to do with me. My accounts with Paypal are all fine now.

The thing is that Paypal has frozen all 11 outgoing transactions from this guys account and is now keeping the money for 6 months.
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mattlaclear

14 years ago

Having been a full time Internet marketer for 15 years now I have an extreme love hate relationship with PP. The best thing you can do is keep your disputes down to nil by communicating effectively (and often!) with your customers. But I must admit I'm always looking over my shoulder with authorize.net or PP for the same reasons this thread was started. Even though I have not had a dispute in over a year (1000+ transactions) I still empty my paypal account every night before I go to bed and then transfer the money from my bank account the day the money hits. It might be excessive I know. But my money is my money and I will be darned if PP or any other merchant account weenie is going to take it.

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Kay King 14 years ago

The thing is that Paypal has frozen all 11 outgoing transactions from this guys account and is now keeping the money for 6 months.

PP doesn't do that arbitrarily - I still think there is something there that you haven't been told about. If most was to CB - were there also multiple refund requests by the person? Something just doesn't add up in this.

kay
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Paleochora

14 years ago

Originally Posted by mattlaclear

Having been a full time Internet marketer for 15 years now I have an extreme love hate relationship with PP. The best thing you can do is keep your disputes down to nil by communicating effectively (and often!) with your customers. But I must admit I'm always looking over my shoulder with authorize.net or PP for the same reasons this thread was started. Even though I have not had a dispute in over a year (1000+ transactions) I still empty my paypal account every night before I go to bed and then transfer the money from my bank account the day the money hits. It might be excessive I know. But my money is my money and I will be darned if PP or any other merchant account weenie is going to take it.

Please correct me if I am wrong, but if they wanted to claw-back and you had voided your linked bank account, wouldnt Paypal just take money off your credit card which you had to link to them as part of the verification process as a 'next available source of fund'?

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Bruce NewMedia 14 years ago

Originally Posted by mattlaclear

"....I still empty my paypal account every night before I go to bed and then transfer the money from my bank account the day the money hits....

I certainly agree one needs to be careful with PP, but how does this bank account maneuver help?

Say you get $500 deposited into your PP acct...then you quickly have it transferred to your bank acct....then you withdraw it or transfer to another bank acct PP does not have knowledge of..

Doesn't this move require that you keep NO MONEY in the first bank acct? since a positive balance is a positive balance. ...so am I to assume the FIRST bank acct can only act as a funnel to other account(s) and have no standing balance?
_____
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BIG Mike

Banned 14 years ago

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Curt7

14 years ago

Exactly what I was thinking as I read this thread. There are always two sides in a controversy. The person telling the story colors it in his favor. Sometimes, it way more than coloring.

Originally Posted by BIG Mike

There's more to the story than he's telling you...

If PayPal's system detects unusual purchasing activity they will initiate an inquiry - it's set up in their dispute system. They will temporarily reverse the payment(s) from the seller until it's resolved. I've seen this take anywhere from about 10 minutes to 3 weeks or so.

This is perfectly normal - no different than your credit card company contacting you because you suddenly start making a bunch of purchases outside of your normal use.

It sounds to me like the person whose account was frozen was doing something to violate PayPal's TOS - PayPal doesn't just arbitrarily freeze accounts.

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craigbrown

14 years ago

That site I referenced before had, in the interests of transparency, posted the ebay/paypal law enforcement guide - it's a sort of whistleblower site. The site gathered donations via paypal and also sells DVDs of its document archive with the payments (previously) handled by paypal.

It appears that its account was locked by paypal out of sour grapes rather than due to fraudulent activity.

More here: http://cryptome.org/0001/cryptome-sar.htm

Check out the paypal help desk screenshot lol - virtual customer service agents? Fail.

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DamianLeon

14 years ago

Yes I agree with Brucer, I always always withdraw any funds the same day from Paypal to my bank account, just to be safe. They have poorly paid and educated people somewhere in a call center that are "investigating" for the most part- I would always just do this- have multiple merchant accounts- probably at least 2 Paypal accounts and an Authorize.net Merchant account such as Powerpay.com - If you have a big launch, cycle them through multiple accounts, and pre-inform all providers about an expected volume spike -

Damian

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greff

14 years ago

Of course we can just set up our own system to take credit cards.

What does that cost these days? I'm so used to PP that I don't even think about it.

Another good processor for hard goods (not sure about electronic stuff) is CCNow.com

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craigbrown

14 years ago

Some cryptome/paypal-related news.

To recap...

- Cryptome is a whistleblower site which had just published ebay and paypal's guidelines for law enforcement.

- Paypal limited cryptome's paypal account (big surprise there) stating they were "investigating" potential fraudulent activity. As a result, cryptome loses it's biggest payment processor for donations and document archive sales - won't shut the site down, but will make it difficult and time consuming to gather donations to keep the site running. In the absence of donations, the creator runs it himself funded by profits from his day job.

CRYPTOME BEAT PAYPAL.
Full service restored.

For those who infer that paypal won't do stuff like this so long as no laws are broken, I say think again. Cryptome (a dinky little website straight out of 1996) has made the US FBI, US Department of Defense and Microsoft backpedal by exposing investigator's bully tactics. They were always going to eat the biggest bully out there, Paypal, for breakfast.

With so many of us here on WF relying upon the goodwill of paypal to keep the cash rolling in, I think it is important to know that there is recourse to arbitrary "investigations" and limited accounts where no illegality has been involved. You just have to think outside the box. Cryptome has shown us how.

http://cryptome.org/0001/cryptome-sar.htm

Image linked with permission from cryptome.

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AverageGuy

14 years ago

my paypal account never got frozen. but, I did get some paypal initilized investigations for some transactions. And most are from fraud buyers and some are paypal mistakes. All in all, I think paypal is pretty good.

david

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Sour

14 years ago

I can't stand PayPal. I wish the worst things possible to that company.

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jedz

Banned 14 years ago

We are using Paypal in our business. Most of our clients paid us via paypal.
We haven't encountered any problem with them. Hope we can hear both sides.

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craigbrown

14 years ago

Just back to the Cryptome Vs Paypal case...

Cryptome encouraged all its readers to cancel their paypal accounts. See link I posted previously for more details. It must have had an effect because this was posted on the Cryptome site this morning:

From: "Muller, John" <jmuller[at]paypal.com>
To: "cryptome[at]earthlink.net" <cryptome[at]earthlink.net>
Date: Mon, 15 Mar 2010 16:29:17 -0700
Subject: PayPal

Dear Mr. Young:

I wanted to reach out and apologize for PayPal's restriction of Cryptome's account. As the head of PayPal's legal department, I am responsible for the policies that govern the use of our service. While our acceptable use policy states that PayPal cannot be used for activity that violates intellectual property rights or applicable laws, there is sometimes ambiguity when determining whether specific information published by sites like yours is in violation of that policy.

In this case, I believe the initial decision on your account was wrong, and we have reversed the restriction. I've personally followed your site over the years and made a small donation several years ago, so I'm particularly sorry for the inconvenience this has caused you.

Sincerely,

John Muller
Vice President - Legal & Compliance
PayPal, Inc.

Unprecedented and a definite win for the little guys out there.

If you ever have a legitimate problem with Paypal, email a summary to Cryptome and cc John Muller.

Paypal is getting a taste of what happens when something goes even partially viral on the web.

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