This website is a collection of horror stories, news reports and other information addressing problems with Paypal, Inc..

Don’t ever rely on Paypal as your only payment option

In February 2011 PayPal decided to place my account on Limitation giving me limited access and I was asked to provide my up to date financials before they would consider releasing access to my funds. Eventually after much persuasion and information provided by myself they finally agreed to release my funds but would keep 20% of all my transactions for 90 days. As you can appreciate for some small businesses like mine this was a large dent in my cash flow which I relied on and therefore I decided to remove the PayPal logo and payment method from my website. However I had no choice but to leave it on eBay as Ebay sellers are forced to have a registered Pay pal account (We cannot sell without Pay pal) – Just for your information I averaged around £60,000 per month in transactions through PayPal prior to this point of which Pay pal benefited from their high transaction fees.

I and many others in my situation believe Pay pal do this to build capital and sit on our hard earned money to earn interest and there are many documented cases of thousands of customers whose accounts are being & have been placed on a reserve and limitation – This I believe is as close to legal racketeering as you can get.

We had no choice as a business and continued in this manner for over one year just to maintain our Ebay account as I had already built up a successful ebay shop with over 99% positive feedback and consistent high seller ratings then in October of 2012 I received a call from one of Pay pal’s sales Managers called David Devereux to consider using PayPal as a payment method on our website once again. I was very reluctant to do so due to the previous stress and issues that we had with Pay pal. He confirmed to me that he would have the reserves limitation placed on the account removed and let’s enjoy the good partnership between us once again. Furthermore he informed me that he would add a sum of £500 to our PayPal account as an incentive for moving back to PayPal. Eventually I agreed to offer PayPal as an alternative method of payment to our customers once more.

In the following months of November and December of last year I purchased links using my PayPal account from various shopping directories for the purpose of SEO/marketing for our website. It was found by my marketing manager that these links were inferior links and not as described which would have a negative impact on our marketing strategy and standing on Google. As a customer of PayPal I exercised my right of placing disputes on various companies concerned and asked for a refund for providing inferior services. Some of the disputes placed were refunded back to our PayPal account as the sellers agreed and some of them were being reviewed by PayPal to reach an outcome based on evidence I had provided to them. I informed Pay pal the sellers had provided inferior/substitute services and therefore I was entitled to a refund.

On the 4th of February I called David Devereux to inquire about the £500 incentive that was promised and he told me it had been credited on the 17/1/13. I checked and this was correct then the following day on the 5th February I received a call from business support asking how the account was running and that PayPal was pleased with the turnover we had achieved in the month of January (over £75,000), and if I needed any help with any issues. On the same day at 12.05am midnight I receive a mail saying my eBay account had been limited as well as my Pay pal account due to suspicious activity. The following morning I telephoned David Devereux expressing my deep concerns as I had been through this before. David said he was not aware that my account had been limited. I also spoke to the Business support department only to be spoken in a very rude manner, who told me PayPal have decided to part with us without giving any notice. On the 8th February after many calls made by me to David Devereux, he called me back and informed me PayPal are not willing to reopen my account. I asked him why this was the case as I had not breached any terms of my agreement with them; He didn’t comment.

I am very disappointed to say the least my account has been closed because I placed disputes against sellers which I had every right to do so as a buyer. I exercised my rights as a buyer through my PayPal account. This is a right I have as a buyer and is a main feature and selling point of pay pal. Thousands of other customers fall victim to Pay pal’s illegal practices and experience similar treatment, but are reluctant to pursue against them due to the size of their empire.

I have no option but to instigate legal proceedings against PayPal for loss of earnings and profit, not to mention the impact it is having on my business reputation. My eBay account has been also been made invalid as we are unable to make any changes. Customers are unable to pay via PayPal, which is linked to my eBay account as both companies are one organisation. I have an excellent eBay account, rated as a top seller (Furnitureinfashion). They have also placed a block on over £4,000 of our funds.

I strongly urge businesses/consumers to think 3 times before using PayPal as a payment gateway. All businesses entirely relying on Pay pal as means of receiving or making payment are placing their business at risk.

Posted: March 11, 2013 at 7:27 pm


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