I'm curious about PayPal freezing accounts because of "suspicious activity" - large or rapid donations. Why does this happen? Specifically, are they legally obligated to do this, or are they just jerks?
This question inspired by Notch (creator of Minecraft
) having his account frozen by PayPal
for "a suspicious withdrawal or deposit". According to Notch there was (and may still be) 600,000€ in the account. If it's not happening to game developers who have had the good fortune to have their sales shoot through the roof, it's SomethingAwful and their Katrina donations to the Red Cross
, or any other number of stories.
In short for the past few years I've heard lots of tales where people are collecting money for good reasons and then have their accounts locked and find themselves up against the wall of PayPal's unhelpful and unspecific customer service. We usually hear the news that it happened, people get outraged, but what's the end of the story? Do these people get their money? Does PayPal return it to the buyers or donors? Does PayPal keep it?
I would like specific examples of the resolution to these kinds of situations. Good outcome, bad outcome, whichever. The larger the dollar amount the better. I would prefer news-worthy stories over personal anecdata.
I would also like to find out why
PayPal does this. Are they adhering to some laws that I don't know about? I'm sure their Terms of Service state that they can
do it, but why
do they do it?
interested in articles about them freezing accounts for things like ads they might think are porn
or seemingly arbitrary reasons
. I am looking for articles about the overall amount of funds or volume of transactions being the "suspicious" activity that gets an account frozen.
(I've seen where some MeFites have had PayPal freeze their accounts or cause them grief (1 2 3 4 5) so re-linking those not necessary unless there's a followup outcome story)