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"PayPal took $80k from me and banned me"

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Re: "PayPal took $80k from me and banned me"

#151

Post by ijhuygft776 »

mpeg wrote: post #22

Ok so I know a bit about this as I had the same exact thing happen to me in the past. The reason this probably happened is that their business was getting a high % of chargebacks from paying customers, paypal is not a specialist payment provider that wants to handle what they consider high-risk business like that, so they block your account and hold your funds for 180 days and during that time keep processing chargeb…

Paypal still need to be regulated. It also needs to be fined for events like this.

Re: "PayPal took $80k from me and banned me"

#153

Post by trogdor »

dannypostma wrote: post #125
djakaitis wrote: post #72

This guy also had his stuff deleted from Heroku. I get the feeling he might be in the wrong here and isn’t telling the whole story.

This guy here (Danny). This is bane of our existence as digital nomads. High chance to get flagged for using lots of locations

Looking at your HN history, your PayPal situation is not at all surprising.

Before this one, your most recent comment on HN was written ten months ago, promoting your website. One person replied to that comment. This is what they wrote:

“I signed up on profilepicture.ai and paid, but have changed my mind before uploading photos. There is no way to contact you through the site for a refund because the live chat isn't working and there isn't a support email. Also, when I search the help desk no content is returned. How can I reach you?”

You ignored that person.

It’s no wonder you are getting lots of chargebacks.

Re: "PayPal took $80k from me and banned me"

#154

Post by gregjor »

TheCapeGreek wrote: post #148
gregjor wrote: post #143

Earlier quoted context omitted.

That's just speculation. We don't know if PayPal "hid" behind KYC/AML laws. More likely the account got too many chargebacks -- I've seen processors cut people off for that reason, but after multiple notices. I don't know what happened, just what the victim posted, but that's not enough to know the chain of events. Accusing PayPal of closing an account and keeping $80k with no additional information seems like a seri…

Chargebacks are also speculation right now. That's kind of my point. These situations never have any usable info. How can any action by a financial/payments company be trusted in this case? We all suck it up and move on so we can make money, but that doesn't make it any better.

> How can any action by a financial/payments company be trusted in this case?

We don't know the details in this case. But we do know that millions of companies manage to work with and trust payment providers and financial institutions, because those providers are regulated and protections exist for customers and merchants. That's not to say that payment processors and banks never do anything wrong, or screw up, or freeze and close accounts arbitrarily. But that's clearly not the norm -- we're focusing on the relatively rare shark attack rather than the millions of swimmers who don't encounter sharks.

I have multiple customers using Stripe and PayPal (or PayPal-owned Braintree). The only times I've seen a processor take any action against a merchant had to do with fairly clear terms of service violations: excessive chargebacks, and operating a business that appears to skirt the law or the processor's allowed merchant types (it was consumer financial "services" in my experience, basically marketing shady lenders). So if I have to guess what happened, I'd guess chargebacks, because that's the main reason things like this happen. When I've seen that the merchant was getting a lot of chargebacks, and the processor sent multiple notices about that -- they didn't just shut it down with no warning.

Re: "PayPal took $80k from me and banned me"

#156

Post by eeghyrdcg »

piltdownman wrote: post #139
eeghyrdcg wrote: post #121

Earlier quoted context omitted.

You linked the wrong comment. I should like to read the right one.

Oh apologies, copy/paste ate the last two characters of the posted URL https://news.ycombinator.com/item?id=34306047

I don’t know, all the comments in that thread seem to think the story is bullshit. So I don’t think I’m too swayed.

Re: "PayPal took $80k from me and banned me"

#157

Post by devaiops9001 »

bluescrn wrote: post #10
devaiops9001 wrote: post #5

Businesses will abuse you like this unless you know how 1.] to sue 2.] how to make a threat to sue sound credible 3.] be strong on #2 with articulation on punitive damages. A well written letter can get things moving pretty quick.

There's not many businesses that'll take $80K of your money and refuse to give any explanation, though. Especially businesses that have a long history of similar incidents.

Heh. I wish it were so uncommon that it were unheard of. Ya gotta have a great legal team or else you'll get hosed. There are days I'd rather have spent coding rather than working with legal.

Re: "PayPal took $80k from me and banned me"

#158

Post by jknutson »

posting_mess wrote: post #96
beeboobaa wrote: post #62

Earlier quoted context omitted.

An $80k interest free loan sounds pretty nice

Any evidence it appears on balance sheet / they use it as capital for investments? or are you just parroting a line you heard someone say one? Parent comment makes it fairly obvious why they are holding the money, seems entirely sane and reasonable - or do you think PayPal should take on an $80K risk? Would you or your business? (in this very specific context)

I can’t be sure of whether this specific line in their user agreement applies to this specific situation (balance of an account that has been locked isn’t specifically mentioned), but a cursory glance at their (Canadian) user agreement [1] states the following:

“PayPal combines your balance with the balances of other users and invests those funds in liquid investments. PayPal owns the interest or other earnings on these investments.”

(I can’t seem to find a way to hyperlink to selected text on iOS, so I’ve also included a screenshot of this quoted statement instead, below [2])

I assume that (unless stated otherwise in their agreements / legal documents) PayPal continues to apply the same policy to funds that are held by them in accounts pending closure for high chargeback rates. I could be wrong though, I just ctrl+f’d for “balance” on the first legal document linked on their site. Also, only applies for Canada, since I didn’t check any other country’s agreements (but my guess is that wherever it’s not expressly illegal for them to do so, they’ll use whatever money they’re “holding” for you as a revenue generating investment vehicle).

———

1: https://www.paypal.com/ca/legalhub/useragreement-full?locale...

2: https://ibb.co/KXc33RP

Re: "PayPal took $80k from me and banned me"

#159

Post by smileybarry »

TheCapeGreek wrote: post #84
smileybarry wrote: post #41

Earlier quoted context omitted.

The problem is a lack of "I want to pay you but don't want to give you my credit card" processors out there. That's 99% of the reason I use PayPal (with just one case of using buyer protection because the vendor just forgot about my order for months and didn't respond). Google Pay & Apple Pay helps with this now (and the fact they're implemented as a payment type like VISA and not a processor like PayPal helps a lot…

I don't understand this "I want to pay without giving my card" thing. Payment gateways process your card, not the app. "Paying without giving my card" is not what that feature is, but rather "card details are saved so you have a lower barrier to spend more".

A well-designed app offloads the "enter your payment details" dialog to the processor (e.g.: Stripe), but many shops don't. You're handing off your details to the vendor's website, which then promises to process your payment with Payments R Us. But (A) I can't be sure of that, (B) maybe their forwarding/processing method is insecure and (C) maybe their server is already compromised and a man in the middle will save my card details.

Compared to PayPal that are a clear redirection in-browser and result in the vendor getting (at most) a "payment cookie" that can be completed to transfer X USD from Y to Z. Or Apple Pay where your (ephemeral) payment details are E2EE to the payment processor's server, even if they go through the vendor's website/servers.

Re: "PayPal took $80k from me and banned me"

#160

Post by mcv »

droopyEyelids wrote: post #140
mcv wrote: post #137

Earlier quoted context omitted.

The real problem is that the possibility of chargebacks makes every transaction uncertain. Chargebacks are an ugly fix to a broken system. Direct payment is better in nearly all situations. The one exception being dishonest merchants, but I don't think that's something you can really fix without lawsuits and/or police.

You still aren't accounting for the case of things sold in the future, like event tickets. That's a unique situation because the event organizer (or kickstarter inventor, or travel agent, etc) needs the money now to invest in something they may not be able actually provide. That isn't dishonesty, but a question of competence plus the uncertainty of life. Those types of businesses rely on loans. The money has to come…

Event tickets are easy to account for. Just specify who carries the risk in case the event is cancelled or the customer can't go the the event. The money can be reimbursed. Happens all the time.

The only problem is when the merchant is dishonest. Also too common, that's really a legal and regulatory matter, because there are always ways in which sellers can break the law.

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