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Thread: PayPal Negative Balance & Chapter 7 Bankruptcy

  1. #1
    srshep Guest

    Default PayPal Negative Balance & Chapter 7 Bankruptcy

    Let me begin with how my PayPal came to be in a negative balance:

    1. I made a purchase with my PayPal debit card at Laptop World for $900 and the amount was deducted from my bank account.

    2. I decided to return the laptop and instead of Laptop World crediting me $900 back to my account they ran the transaction as another purchase. At this point I'm now out $1800!

    3. I return to the vendor to inform them that they didn't issue a credit but charged my card again. The result? They then charged my card a 3rd time! I'm out $2700 now!

    4. After realizing that this company is trying to scam me I file a dispute with PayPal for the fraudulent charges. Money is posted back to my account temporarily during the dispute and I wait.

    5. PayPal decides they will side with the vendor and that I will be responsible for the $2700. All of this is decided without a single receipt or signature of the purchase from the vendor. The vendor at the time of the first sale had stated that they ran out of receipt paper and I was ok with it because of the fact I THOUGHT I would be protected if any problems arose.

    So PayPal locks my account and also locks my eBay account because of the negative balance. Before this situation I had a perfect eBay and PayPal ranking with no disputes or negative feedback.

    Now we get to the current situation.

    I filed for chapter 7 bankruptcy and was granted the bankruptcy. I listed PayPal as one of the creditors and now the debt has been discharged. I contacted PayPal to ask about removing the locked status of my account now that the balance has been discharged and I was informed that they WILL NOT remove the lock status and that my only option is to open another PayPal account with different information. I still have the same phone number, address, SS#, etc. So obviously this isn't going to work.

    Here is my question:

    Can PayPal still keep my account locked and my eBay locked after a Chapter 7 bankruptcy discharge? Is this legal for them to still hold me liable and my account status as locked?

  2. #2
    Unregistered Guest

    Default "Right to refuse service to anyone"

    While paypal will not be allowed to collect this debt you "owed" them, they never have to open your account again. Business may not disallow service based on age, race, creed, etc, but they ARE allowed to refuse service to someone that filed bankruptcy on them. This is pretty common among businesses - filing bankruptcy on them generally means they will blacklist you.

    Not sure why you WANT paypal again after what they did...

    As always, we are random people that hate paypal, not lawyers or anything else. Standard disclaimer for random internet advice applies here.

  3. #3
    Join Date
    Oct 2014


    Bankruptcy is a legal proceeding involving a person who is unable to repay outstanding debts. We also deal Chapter 7 in Bankruptcy. Chapter 7 is the most important bankruptcy chapter filed in the California.
    Justice? You get justice in the next world, in this world you have the law.


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