Paypal closed my account due to Multi-level marketing?

It gets worse.

Take a look at this here.

WSO thread -> WSO order processor -> WSO vendor -> WSO affiliate -> customer

That's five levels, just like most pyramid schemes.

And we actively encourage people to move up the levels.

You buy a lot of WSOs? Cut it out! Go promote affiliate products, like, well... WSOs.

You promote affiliate products? Cut it out! Write your own product, which you can... well... sell as a WSO.

You wrote a product? Stop that! Write some software or run a service, such as... hmm... maybe a payment processor for WSOs.

There are seven major payment processors used on WSOs: RAP, DAP, DLGuard, JVZoo, MooshPay, DigiResults, and WSO Pro.

Each and every one of these is Warrior-owned and Warrior-operated.

Now, forget for a moment what you may know about these payment processors (specifically, that all of the operations are completely independent and there is no conspiracy or collusion going on here).

Doesn't it LOOK like a pyramid scheme?

This is why I made the personal decision to pull all my WSOs. I believe it is dangerous for WSOs to represent a major portion of your transaction volume, because no matter how innocent it may be, there is an appearance of impropriety.

I think that's a new condition on the WSO forum, and I'm very concerned about whether we'll be able to fix it. Or, indeed, whether it can ever be fixed at all.

It doesn't matter whether we really are doing anything PayPal forbids. It only matters whether we look like we are.

I don't have any answers. I'm open to hearing other people's ideas.

Yea, thats an erie call to listen to but like the paypal guy says its a priveledge not a right and the decision is theirs and theirs alone.

Every product sold on the warrior forum WSO section could be classed as MLM.

There are some coaching courses selling for $500 yet there paypal accounts stay intact so Im assuming its only a mater of time bfore more may be limited and eventually shut down.

If your selling wordpress plugins or similar products without wild claims then your alot safer in paypal's eyes as the truth is they don't like the fact that there allowing info to be sold where only the very small minority will actually go on to see results from what there taught.

Internet Marketing has never been a smooth sailing operation and paypal just make it harder each day, but its their business not ours.

Garrie,

If using a service like WarriorPlus then the referral url they would see is WarriorPlus.com. You don't think they know what WarriorPlus.com is by now, and probably even JVZoo.com as well. You don't think they can put two and two together. Besides, on your Warrior Plus thank you page, which I am sure Paypal can probably access quite easily, is a link back to your original WSO thread.

They know exactly what you are doing, don't kid yourself.

None of them are payment processors. PayPal is the payment processor. That's why I called them order processors. They certainly do process the order.

But that's an important point. A lot of people do get confused on that matter.

PayPal does, however, track down sales pages to investigate the sales methods in use. And the sales page for every WSO Pro offer is a thread on this forum.

Yeah, I have been looking into this a bit as it will definitely effect a lot of marketers this year and beyond. The way I understand it in general is that PP doesn't so much like 'services' and products that are electronic AND are tied to guarantees and refunds.

That is, if you have a wso or you are selling coaching or whatever the hell and you put the "60 day money back guarantee", etc. down, they aren't gonna dig you or what you are doing. They are successful enough and don't need IM people acting against what PP wants by making these guarantees of refunds etc.

It may be stupid or petty on PPs account, but that doesn't matter. Big or small marketer, you need to really understand and work with their TOS. They are a business, you are a business. If they don't jive with what you want to do, find a business that does...

MLM, IM, whatever, doesn't matter. If they don't like it and it doesn't jive with what they want to do, why risk it? It's like using adsense and bringing iffy traffic to your site. G may ban your ass and then you are SOL. Even without iffy traffic, G may ban your ass.

Diversify and act like a dynamic and flexible business. This is the way forward....

If PayPal regard such affiliate systems as promoters of MLM why would they approve the likes of JVZoo which involves manual intervention by PayPal staff to set up?

Here's the text from the AUP, I added the emphasis to 3b

Alertpay is pretty good, I've used them pretty much since they opened. (Not a lot, but some people prefer to pay through them).

Not sure about other services, I've heard of safepay but I have no clue, haven't used them.

The closest option to PayPal I have seen is Plimus. That service has affiliate payments and now I see third party royalties so payments can apparently be split 3-ways.

Plimus works with Mastercard, Visa, etc., and also PayPal.

On the other hand, Plimus has been receiving the same type of pressure as PayPal about servicing certain types of businesses.

Forex is out and there is a separate thread on that topic.

Plimus also does not allow

• Pyramid or ponzi schemes, matrix programs, or certain multi-level marketing programs.
• Work from home business opportunities or other 'get rich quick' schemes.

But that is fairly standard language and different from what PayPal is apparently stating.

On the other hand, I agree with Bill that the OP's ad copy was way over the top and likely a factor.

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I'd check with kindsvater about Alert Pay ... there was a thread where he said that they're pretty much shut down in the US.

But if in their system a $10/hour guy has the power to shut your entire business down and tell you it could be a week or two before his supervisor can get back to you, that alone is cause for concern.

Upon reflection, I think part of this whole PayPal Problem might be that when they started, if I recall, they really didn't intend or pitch it as a big merchant payment thing... it was more like for when you wanted to send Uncle Ned in another state some money, like Western Union except instead of having to go to a Western Union outlet it goes straight to your bank account. Maybe also for really small informal business transactions between people, but as happens on the net, it quickly blew up to something much, much bigger.

The sky may not be falling, but I think I saw it slip down a couple of notches.

I just feel like if they are going to sow fear and blatantly say they're out to phase out the type of information we sell, then we would be smart to replace them with a friendlier option who deserves the business.

On the Merchant account part - don't be too sure. They have the right to do exactly the same thing Paypal does, and I know for a fact they WILL freeze your account or shut you down.

It happened to my former partner (who is now still my programmer, we simply went our separate ways a while ago).

Anyway, he was processing huge amounts, like $10K a day with no problems for like 4 or 5 months. Then things slowed for a while, and when he suddenly had a bigger day again of 10K they froze him and held it for 6 months. (All because of an idiot scammer who caused a couple of refunds).

He got a second merchant account... had no issues till he suddenly charged a programming gig invoice of something like $1500. They questioned him and then said they weren't approving him of payments that high so he had to either do small increments or leave.

Weird!

Anyway, he's got a solid account now and has had them for a few years, but he does no where near the $ that he did when we were partners, so I guess its a non-issue.

Myself, I stick with 2checkout, alertpay and paypal (at this time).

In Canada its like jumping over a LOT of hoops to get a merchant account (from my research, I've looked a few times), and previously at least, they did NOT like online sales stuff so made the hoops even more. Maybe okay for hosting and programming, but I do neither.

As for the person that mentioned Alertpay being stopped in the US, are you sure?? I did read the thread, but from my understanding, we had to do some approvals a few months ago to continue allowing credit cards or something.

You had to go through a further verification process, which I did, and I haven't had any problems or notices that I can't process credit cards, as long as my site is approved (which it is).

I think the problem came in with those people who WERE running scams like those cash gifting things that were obviously pyramid style schemes. But from my understanding, Alertpay allows MLM as long as they're legit.

I don't run those though, so I don't know.

Maybe that's what triggered these visa/mc issues since? (Alertpay went through something similar a year or two back which is I think why they did start some restrictions and verifications, but don't quote me on that... my brain isn't the best for that because I don't use Alertpay a whole lot. It's just a backup alternative for a few of my customers who prefer it because they can't use a CC with 2checkout.)

Amber

Neither Avangate nor Fastspring allow IM products (of any type). I've spoken to them many times - they don't allow IM/link buildign services, subscriptions, coaching, MLM, anything to do with making money (in any way), guides on how to build websites,etc.

Avangate are not as strict as Fastspring, but still... Definitely not an option for the majority of people on this forum.

Authorize.net is just the gateway. You still need a master merchant account.

There are a number of solutions, but the best strategy is to get your business underwritten upfront with a merchant bankcard account.

There are no monthly fee and low rate options that beat most of the online payment solutions available.

One-size-fits-all is not always the best solution. That's why they double your costs.

Interesting, I didn't know that they're still having issues even on bank transfers. That's not a good sign.


Re: Fastspring as someone mentioned, it looks interesting, the only issue I have with it is it takes 2 weeks to get payment - 2 weeks AFTER. (So if you had sales from the 1-14th, you won't get paid til the 30th).

2Checkout pays me weekly, and I've had sales as close as Monday and they're still deposited by Friday. Maybe that's not norm, not sure, I know at one time you had to have a number of sales coming in to get that status, but having a 2 week delay is a bit annoying on fastspring.

In that respect, I can see a merchant account makes more sense. (Again, being in Canada its not as easy as it is in the US, but maybe its time to look into it again).

They've shut down accounts that do make "a lot" of money. The higher the processing the higher the underwriting risk. They actually don't make that much off each account anyway.

Most of the rate charge goes to VISA or MasterCard and the acquiring merchant bank. PayPal is actually the "merchant" and you are using their service. They are not a bank and simply escrow your funds requiring you to ask permission to get them.

The funny thing is they have your money to cover their risk. It's just that they are liable for up to six months for charge-backs. That's why they often seize accounts for up to half a year.

They have shut down accounts with no complaints or problems.

The fact is they are moving into the retail sector with payment wallets. This is another reason they are shutting down more accounts now and limiting the IM market. This month they are launching into top-tier retail and expanding a pilot program with Home Depot.

This is not accurate - paypal is hitting people who have never had complaints and even I was affected by this in the past. This is what made me dig into the reality of paypal's corporate structure and who is their master. I would never use paypal after all I found out through good due diligence - they are a minion puppet in the new growing game to "track alternative income" sources.

There is a growing agenda in this country (and others tied to central banking co-dependency) to stifle independent wealth creation through alternative means. There is no longer a "small business friendly" climate in this country and THEY want you to go back into the JOB system just like all the other timid and docile masses around you. There will continue to be a clamping down on those who try to develop wealth independence outside of the system (going and getting a JOB). The ability to transact payments electronically is the weak link that small business owners NEED services to provide - as a result, this process will continue to be stifled (over regulated) by the companies that provide this service or from new govt laws/regulations.

I have seen this also playing out in the Trading Education/Trading System industry so it is not just a MLM or IM situation - any group that has the ability to create independent wealth (and financial independence) for themselves or others is right in the target at this time - so get ready for even more problems ahead.

My mentalities at this time are real simple - Improvise, Adapt, and Overcome! ;-) I wont let the pricks who run the "system" have the satisfaction of beating me at this game - LOL!

I'm afraid the days of the Wild West on the Internet for the Information Marketer are drawing to a close, for better, or worse.


Seems now, you're no longer welcomed at PayPal if they even smell an IM that promotes hyperbole in a money making proposition. Watch out if your gig is the, You Can Make $10,871.31 a Day Doing the Two Step Shuffle. Furthermore, I wouldn't expect some other provider to carry the water for very long, if they won't.


Amazon is quickly booting anyone out the door and closing accounts that sends a Kindle book on down which has even the faintest suggestion to a relationship with PLR, or has information which they deem, could be just as easily found on the Internet. By the way, the noose, as well, is also quickly tightening on their Amazon affiliate program.


I don't have to remind everyone that Google is putting the squeeze on almost monthly, dropping sites faster then bombs over Dresden, which add little or no value other then a link to some affiliate promotion.


Looks like it's back to the future. Selling physical goods, unique information with terrific value and producing quality. Same as it ever was.

As a matter of fact, if you look at what drew Frank Kern's lawsuit from the FTC in 2009, it was his product someone stole and resold fake coaching with his branding.

They claimed THAT was a pyramid scheme. Reselling his stuff. Sound familiar? Frank took a loan on his house to pay $100,000 in lawyers and settlement costs.

Even though he had nothing to do with the resale, he got busted. The income claims were not mitigated by the site disclosures.

The FTC agent told him they figured if you had disclosures on your site you must be doing something wrong anyway. Go figure.

Keep your nose clean. Shoot straight.

Paul is right.

You can't just sign up for any merchant account. They typically give you a ticket approval based on your current usage and volume.

If you launch a new product sale and flood your account, your account will automatically be flagged for fraud review. The sales may be held.

You must have an account established that meets your business type and volume that plans for future growth.

One of the problems is the increasing government regulation of businesses like PayPal. For instance, since PayPal has an electronic record of your financial transactions the IRS decided it wants the summary income data reported to it. The cost of compliance, in addition to liability issues, makes it difficult for someone to easily create alternatives.

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This is solvable. Not to worry. Go to Entropay, use your credit card and create a virtual visa card. This Virtual visa card can be used for your future online payments.

I can secure merchant account approval for "high-risk" merchants. I also have several international payment platforms that handle "high-risk."

PayPal as a company is a "pet" useful idiot of the Central Banking minion puppet bank syndicate - the paypal business debit cards are backed by Chase (go do some due diligence) which is one of the "favored" minion puppets. The "system" wants their hands into the electronic payment game and they indirectly influence paypal as a company (so don't be surprised paypal is trash and will treat you like a scumbag even after they have made big coin off of you for years - just a numbers game to them).

I would definitely find alternatives to paypal and get away from their autocratic nature - they are not around to help small business - they are around to model and track online business activities until the next financial grid consolidation event.

I signed up for a WePay acct today - just sent out some invoices.

Later today I will add Dwolla too! ;-)

The only thing I can think of when I hear that PayPal might lock out internet marketers is that some smart marketer is going to make an absolute killing with a new payment processing service!

I can understand why they are starting to hate certain "Get Rich" products. Many of them have refund rates as high as 40% or more. The majority of these refunds are handled through PayPal, usually in the form of a dispute or complaint from the customer.

Just think about how many "Make $956737 in 30 seconds!" info products there are. There must be thousands. Think about how many sales those represent in one year, 10s, maybe 100s of thousands of sales. Now apply that 40% refund rate and you're talking about A LOT of transactions.

From a copyriting standpoint, maybe it's time to stop telling people they can make money in no time with no effort. Maybe it's time for something like:

"I will show YOU how, with 6 months of diligent hard work, YOU can have a successful and profitable website!"

It doesn't sound as good but it's honest *shrug*

That is not their only problem, I understand they cannot accept Visa/Mastercard which pretty much makes them useless.
_____
Bruce

I agree completely, look at what they have to endure with the "info" products, buyers and sellers.

This is something I wanted to call out here.

Joan clearly thinks effectively all WSOs are MMO products.

And Joan is one of us.

I am very, very concerned about the likelihood that PayPal and people like them will draw similar conclusions: that, say, every WSO Pro offer is an MLM scheme... or every MooshPay product is a pizza recipe.

The latter example is no less absurd than the former, but that will not stop people from drawing the conclusion.

PayPal is not being particularly dense or obtuse about this matter. They're being just like everyone else. They don't pay much attention, draw conclusions based on little or no familiarity, and refuse to change those opinions no matter how stupid they are. In fact, the harder you work to change those opinions, the more those who have them will abuse and mistreat you for trying to make them think.

People are just naturally selfish, lazy, ignorant, and mean.

2checkout -

Flat Rate as low as -

Rate: 4.5% (Standard Rate 5.5%) Per Transaction Fee: $0.45

That to me is highway robbery!

Merchantinc.com rates are better at 1.99% + .025 and this is the reason I am going to set up a Merchantinc acct for one of my new Futures Trading System websites and see how it goes.

Haha

I see what you are saying, but a more accurate example would be Harvard teaching all of their students how to recruit other students into Harvard. That's basically what MMO has been reduced to.

You end up with an ever growing population of misguided marketers whose only skill is talking others into trying to make money online (by convincing still more people that they too can make money online). There truly is no end product or sustainable skill.

How many of you would be up a creek without a paddle if the MMO industry went under? Don't think it can't happen, because it will. The "envelope stuffing" industry used this same exact model.

You read an ad or got a flyer saying you could make money by sending out mail. You paid your $30 or $75 or whatever and received an alternative version of the very ad that you bought from. You sent that ad out to others and the process just kept on repeating itself. That matches MMO info products to the T. It too will collapse.

PayPal doesn't ensure the quality of your product... and as far as I know, they've never banned an account based upon their review of a product... They couldn't even see any product you were selling through there..

So I don't see how the quality of your product (other then that if its terrible, you could have chargebacks) has any bearing upon whether or not you have issues with your account.

Caleb

Paypal are def tighting up thier ship They have been banning a lot of file locker accounts too due to copyright issues. Im suprised that Visa hasent started to clamp down to ...Time to move to Bitcoin

Paypal are not necessarily getting worse. They have always been quite strict in what they will and will not let ride on their network.

We just have more sellers on this forum than every before so we hear a lot more of the horror stories. But there are still way more people on this forum using Paypal without any problems at all.

Thank you for mentioning us here.

Payoneer supports MLM payments and have many MLM partners and we are continuously trying to add more.

If any of you have questions about Payoneer and how we can help you receive your payments please feel free to contact me by PM.