Don’t Use PayPal

Yesterday I read this via reddit, and regardless of if this specific story is true or not, I know that it is certainly the type of shenanigans that PayPal loves to pull. I had an awful experience with PayPal this past summer, and after trying once again today to close my account I have decided it is time to share my story. Gather ‘round, and I will try my hardest to not swear or let this devolve into a tirade.

I have (had?) two PayPal accounts, which is allowed under their TOS. One was a merchant account, which was used to collect millions of dollars via Blongoff Records. The other was a personal account which I used to buy books on a PayPal related website. This worked for 7-8 years and all was fine on the internet.

Back in May we moved and I updated the addresses on my PayPal accounts. Within days both accounts were locked. My merchant account said nothing, but my personal account had this message:

May 22, 2011: It’s been a little while since you used your account. So, we just want to make sure that you authorized some recent transactions.

Kind of an odd message, since if I hadn’t used the account, why would there even be transactions? As it turned out, there weren’t any. But the account was still locked. So I called up PayPal to see what the issue was and how to fix it.

What happened next was the type of thing I had heard about PayPal doing before but never assumed it could happen to me considering how little I actually did through them. When I called, I was told that the limitation was permanent and the risk of doing business with me was too high. In addition, they would not tell me what the problem was, and there was no way for me to appeal or otherwise rectify the limitation.

I did some research and found some similar stories where an account was locked because someone had moved and there was still another account listed at that address that had engaged in nefarious activities. Obviously there was no way for me to confirm if this was my issue.

Some time later I was on a walk wondering what I would do with my life without PayPal, and a new message appeared on both accounts which seemed to confirm that it was an address issue:

Jul 10, 2011: Our system detected that multiple PayPal accounts contain registration information similar to yours. Our User Agreement allows PayPal users to have one Personal account and one Premier or Business account. To return your account to regular standing, we will need to confirm some of the information on your account.

If it wasn’t an address issue, than something else on either of these accounts (credit cards, bank accounts, phone number) would be connected to other accounts that weren’t actually mine. If this were the case, than it was a huge issue and hopefully PayPal would have informed me of this. A few years ago when I worked at my last job someone had compromised one of the accounts and was using it to buy virtual currency for an online gaming website, so my concern was that maybe something similar had happened except they had created another account with my info.

Recently I got fed up and tried to just shut down the accounts, only to find out that limited accounts can’t be closed. I called again them and they said the reason was that I could just create and account again after I closed it (“not that you would do that, Mr. Belkas”). I pointed out that this wasn’t a valid reason because they would still store the account information after I had closed it and it would be obvious if I tried to open another account since they already have my address and credit cards. They didn’t have a response for this.

I tried once more to discover why my account was limited. Again they said that the risk of doing business with me was too high, but they wouldn’t say what exactly caused that risk on my part. I asked why I couldn’t know the cause and was told that I could use what they said to circumvent how they lock accounts (“not that you would do that, Mr. Belkas. Never your dildo”). Either way there was some secret algorithm they used to determine how risky I was as a customer or merchant, and I had stepped over that threshold somewhere between April and June of 2011.

I think what annoyed me the most was how passive and uninterested the call center people were, although I am not sure why I expected otherwise, since their job is to answer phones. They casually told me repeatedly that my accounts were locked permanently and I would never be able to use PayPal again. This could put me at a serious disadvantage since PayPal is one of the only ways to move money on the internet. Luckily for me there are other options, but someone less technologically inclined could be completely screwed if this happened to them. Especially if they had money saved in their account (which luckily I didn’t) and PayPal decided they would hang on to it for just a little while.

I jokingly asked what would happen if they kept shutting down accounts and ran out of customers. He informed me that they had over 100 million registered accounts. I think this was supposed to impress and/or embarrass me because of how big their business was. Instead, it reminded me of how insignificant I was to them.

I have often heard stories like this over the years, so I tried to limit my risk by never keeping money in my account and keeping everything in good standing. Unfortunately this didn’t work for a reason that I will never know. Luckily, there will probably be no long-term consequences from this since most websites that use PayPal allow you to complete the purchase without having an account, but for the most part I will probably just not purchase from businesses that only accept PayPal.

Do what you will with this information, since I would never tell you to not do business with a company just because of the experience that I had. Except for in the title of this post and the tl;dr.

TL;DR: Don’t use PayPal.