Funds Stuck in Paypal? Here’s Some Drastic Measures

(Digital Money World) Paypal Week – Over the week, we’ve discussed about Paypal being an easy online payment solution to your business and have shown you which type of accounts should you be using, and how easy it is to add simple HTML codings to your page for donations/ buying a product from you. And if you have any problems with integrating it to your business, a developer directory is there from Paypal Developer’s Network.

In the last installment of Paypal week, we’ll touch on the seemingly troubled Paypal users on what you can do when you have an account suspended temporarily (frozen) and some sites which has solutions that make sense.

Under Paypal’s Acceptable User’s Policies, they have the rights to hold your money to investigate for fraud/ money laundering/ charge back purposes. Here’s a more paranoid list which is compiled by an anti Paypal site, paypalsucks.org

• you have more than one PayPal account, or PayPal thinks you have more than one PayPal account.
• you clicked on a link in an email that you thought was from PayPal, but it really was a phishing expedition.
• you moved into a house or apartment that used to be occupied by a con artist who used PayPal to steal.
• you got a new phone number, one used by a con artist who used PayPal to steal.
• you use an ISP that assigned you an IP that was used by a con artist who used PayPal to steal.
• you paid someone, like a con artist who used PayPal to steal.
• someone paid you, like a con artist who used PayPal to steal.
• your name and/or address is similar to a con artist who used PayPal to steal.
• you sold something to someone who questioned it’s authenticity.
• you bought something from someone who had someone else question the integrity of something they sold to you.
• you registered a bank account or credit card that someone else used one time.
• you accessed PayPal at a friends house one time, and that friends account was frozen.
• your friend used your computer to access their PayPal account, which was later frozen.
• you sold an item that is a common item often sold by con artists who used PayPal to steal
• you bought an item that is a common item often sold by con artists who use PayPal to steal
• you accessed PayPal via an anonymous proxy service.
• you sent more than $2000 to someone. (See Former PayPal Employee #2)
• you received more than $2000 from someone. (See Former PayPal Employee #2)
• you participated (knowingly, or unknowingly) in the “work at home” money shuffling scam.
• you sent money to someone in foreign country that PayPal considers “evil.”
• you received money from someone in a foreign country that PayPal considers “evil.”
• you used your PayPal ATM card in a foreign country that PayPal considers “evil.”
• your account was “corrupted” by a criminal posing as a PayPal employee. (See Former PayPal employee #1 and WhistleBlower #1.)
• and other reasons that only PayPal knows about….

Personally, I do have a friend who has over $6,000 frozen in Paypal and was released only about a year later. The reason given was ’suspected money laundering’. Take extra caution if you’re running a business that uses Paypal very often as I’ve heard many horrible stories of how Paypal suspends an account easily.

If you have an account that’s freezed by Paypal, there’re 3 ways to claim back your money.

1. Do everything as told and wait

Furnish as much details as Paypal requested and wait for the verdict of your account to be unfreeze. No time line will be given to you when they will eventually do that. Most of the time they’ll be asking for your bank account statements, your personal identification information. Try calling them as many times as you can to follow up your case.

2. Submit your case and complain to FTC & BBB at the same time

Contact Paypal, with your freeze amount and wrongdoing reasons filed with Federal Trade Commission (FTC) and Better Business Bureau (BBB) at the same time. This step is more drastic then step 1 but you’ll receive response much faster from Paypal since there’s external pressure. But if you’re to take Step 2, chances are you won’t be using Paypal again.

3. Lawsuit against Paypal

This step would be costly and there’s no turning back should you choose to take this route to recover your money. Legal action means cost involved and whether the amount that’s being held by Paypal is worth in engaging a solicitor (who must know how to do it of course) to do so.

Here’s a thread started by lawsuits on paypalsucks.com on how to file your suit correctly.

Conclusion

Paypal is a good beginner payment solution to begin with and also with the market population of over 164 million accounts, Paypal is well known and chances of users having a Paypal account to buy or use your product/ services is extremely high.

If it doesn’t have complaints on suspending people’s accounts so often, it would be even desirable. Oh well ;)