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Thread: PayPal stole my $57,000 - I want to sue

  1. #1
    paypalVictim Guest

    Default PayPal stole my $57,000 - I want to sue


    I believe I am a victim of PayPal's Abuse/Fraud, where my accounts
    were closed and funds of $57,000 held by PayPal.

    I have been a PayPal user for 4 years. I do have 2 PayPal accounts, a
    personal and business one. Yesterday, both of accounts were closed,
    without notice (except email that landed into spam).
    We do run a legit online business and receive payments over PayPal. We
    don't get disputes/chargebacks and even when we do, we instantly
    refund, even if service has been delivered.
    In the past 2 months, out of 3,000 transactions, I believe only 1
    chargeback and 2 disputes were received, which is only 0.1% of all
    transactions. I think such number is completely normal, in fact I
    believe we are doing great!
    Our services do not violate PayPal Acceptable Use Policy, and are NOT
    fraudulent or unethical in any way. Additionally, I have not violated
    any of PayPal TOS. Both of my accounts are established, verified
    accounts (verified with copy of ID), and have linked valid, legit
    credit cards.

    I have called PayPal support and received very negative and unfriendly
    response. Infact, during the whole conversation with customer support
    agent, and supervisor I felt like 'I was being a piece of trash for
    They would not tell me why my accounts are closed or why my funds are
    being held. The 'official reason' for closure is this:
    Sep 4, 2012: A recent review of your account detected suspicious
    activity regarding the receipt or withdrawal of funds. While we
    investigate this matter, access to your account is limited.

    I have only withdrawed money to my credit cards, that cannot be
    illegal or fraudulent in any way. The only way of income was sales
    income (August 2012 sales were totalling at a bit over $40,000, over
    1,000 transactions from our clients). That cannot be fraudulent
    either. How can be doing legit business be considered as fraud? I'm
    calling PayPal Bullsh*t on this one. There is absolutely no reason why
    my accounts should be closed and funds held. If PayPal didn't want to
    do business with me (I don't know why not, since I pay thousands of
    dollars in fees), they could have just told me that and I'd switch to
    other payment processor.

    Not only are our sales hurt (about $1,000/day), but PayPal is by
    holding our capital, efficiently killing our business. Our clients
    currently hold 22,811,991 credits worth approximately $34,924.67. We
    are obligated to deliver services for the credits that people have
    purchased using PayPal. As our services aren't 100% profit, but we
    have about 40% expense by 3rd party suppliers, we require about
    $15,000 to deliver the services. But wait, PayPal took our money and
    we are going out of business. The customer support on the phone said
    thats my problem, and that I should finance my business however I can,
    but not with my money on PayPal. They would literally prefer
    chargebacks, disputes and business going broke, than release the
    We currently have 619 clients with substantial amount of credits, 370
    of which are chargeback-risk as they posses over $10 of credits. What
    do people do if service goes offline...try to get their money back.

    Not only is PayPal killing our business, but its hurting me as well. I
    had $20,000 of savings on my personal PayPal account. I am so stupid
    for not keeping money in bank, but rather keeping it on PayPal. Now I
    only have few months worth of savings on bank and after that I can't
    afford food, rent, gas etc. I will not be able to afford my business
    trip to China either. I had not many transactions on my personal
    PayPal either, infact I had money sitting there for 9 months (last
    year I sold my website for large sum, and got some funds from sale in
    PayPal). Again, Im calling PayPal Bullsh*t here, how can having $20k
    of legit money be considered as 'suspicious activity regarding the
    receipt or withdrawal of funds'

    I honestly cannot think of any reason why PayPal would want to stop
    doing business with me. Until yesterday, I thought I was a valued
    client. Now PayPal is ruining my business and treating me like trash.
    I believe I am a victim of some sort of scam or abuse from PayPal. I
    am confident in my case, as I did nothing wrong. I was just using the
    service without breaking any rules or posing any threats to the
    company. It is very unrightful to, without a genuine reason, 'steal'
    or 'hold' someone's funds.

    I am thinking about lawsuit, however at this point I will just send
    the demand letter and try to settle with PayPal directly.

    I live in Europe. Can I sue from my home country? Any guidelines I should follow? Is there a way to colleteral sue, like more of us who got fu*ked by paypal?

  2. #2
    John111 Guest



    Your situation is very similar to my one current one, except i managed to take out 9k of the 16k profits before the account was frozen.

    I have been doing some digging online, and you can infact complain to your local government organisations (saves paying for a lawyer) the process for investigation seems to take about 1 month and there is no guarantee that the situation will be solved. The other thing is you can write a message to paypal regarding your clean track record and request to withdraw a portion of the money in the account and keep some to cover the chargebacks etc. (though this wont necessarily work). Lastly you could get a lawyer on your behalf to write them formal letters addressing the situation, the error and proof.

    I'm not sure if you can complain to US gov. organisations but im sure it wouldn't hurt to try the BBB, as Paypal is a Global organisation primarily in US.

    Hope this helps and gets resolved,

  3. #3
    Unregistered Guest

    Default That's disgusting... Paypal are crooks!

    I am sorry to hear you're going through that. Suing from your home country would be a challenge, but possible. If they are registered in your country to do business, then that is the law they must follow. I am not sure what country you're in, but I would immediately file a compaint with your equivalent of the attorney general. Best of luck.

  4. #4
    paypalVictim Guest


    well I gave up. I guess Ill have to wait half a year to get MY money back. Money that PayPal has just STOLEN from me.

    Ill probably make a youtube video and share my experience to help others and raise awarenes.

    Im not gonna go into legal stuff, I dont want to spend any money on this.

  5. #5
    Rollie Guest


    Post a link to your youtube video here is you do make one. Sorry to hear you've given uup but I totally get it. Dealing with paypal is like hitting your head against a wall, gives you nothing but a headache.
    Paypal is all lawyered up and know that most people don't have the time or money to fight them.

  6. #6
    Unregistered Guest

    Default same problem

    Hi, i had the same problem with paypal as you did and i was processing the same ammount of money as you are, and as i later found out my self the problem was because of a problem in my industry. Maybe its the same problem with you? what do you sell?

  7. #7
    Guest-reply Guest

    Default Paypal freeze restrictions

    Same happened to me here in Australia when I sold an iPad and Paypal froze $340 or so in my Paypal account and demanded more information which I provided and they unlocked the account. They also rejected my bank so I can't withdraw the funds. Then after I received approx $800 they froze / limited my account again so I could only withdraw $101 to my other Paypal account, so I phoned Paypal and they told me they limit accounts near $1000 because of government counter-terrorism and anti-money laundering laws. I asked why they didn't say this up front, and Paypal told me that the government doesn't want them to mention it because people will circumvent the system. Later I discovered I was able to bypass the withdrawl limit (not sure if paypal relaxed my limitation) but I was able to buy things to empty funds from my account (the plan was to buy items and sell them for cash to recover my money). All seemed to go well when suddenly I was unable to buy an iPad as Paypal blocked the transaction. That was the last straw and I canceled sales to my previous customers and told them to open Paypal disputes to recover their money.

    So here's what I discovered by experience:
    Paypal have alert systems in place to freeze new Paypal accounts who receive sudden spikes of income. Keep incoming transactions small, under $300 until you build a history smaller transactions then you can increase it over time.
    Keep your account below $700 to avoid the counter-terrorism and anti-money laundering limitation. If you do this you might avoid the Paypal freeze, otherwise Paypal may hit you with a freeze and demand more information or ID to unlock your account.

  8. #8
    Unregistered Guest

    Default So greasy!!!!

    I say we all chip in and hire a hitman!

  9. #9
    Join Date
    Jan 2014


    That's absolute bullshit. I would sue for 5,700, let alone 57,000!!!!! I pray that you sue and show their asses a thing or two. Absolutely uncalled for. I'm tired of hearing about these a-holes taking advantage of the small guy! It's time someone showed them to stop!

  10. #10
    Join Date
    Jan 2014


    Quote Originally Posted by Unregistered View Post
    I say we all chip in and hire a hitman!
    Yes, let's kill Mr. Paypal.

    Anyway, I would contact customer support again. You ran your business through Paypal for years, mention that.
    What country are you from? Maybe there has been a substantial amount of illegal activity from your country so they are double checking everything.
    They also say that they are currently checking your account, maybe they will release it themselves.

    Contacting customer support is the first thing you need to do but be friendly. Complaining will get you nowhere.


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