Send us your essays, letters and comments!Letters to the Editor

Read what other PayPal users are saying about PayPal! August 2007 is the first month this website is available to the general public. We are happy to have received one submission thus far. It is an excellent article written by a very unhappy PayPal customer. As this site's popularity grows, more users will submit editorials and articles for your viewing pleasure.

If you want to see your letter published here, then CONTACT US! Your letter will be published here in time for week one of the September 2007 editon. New letters to the editor will featured every week beginning on Monday morning.

What are "Letters to the Editor?"

While you can submit a PayPal horror story here, this is not what "letters to the editor" are for. Your letter to the editor should be some original writing done by you about your thoughts, opinions and dealings with PayPal. Also, you can submit any articles that you write about PayPal that you think might educated the public about PayPal.

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Many people submit some good stuff inside forums, but after a while it gets buried under a mountain of other stuff. The chances that somebody will read what you wrote grow slimmer with each new message posted.

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PayPal Treated Me Like A Criminal

Submitted by: Clara Jenkins

I found your site by accident! It looks like you are just starting up. Let me say this to you guys...your website is the best! I spent about an hour on here the first time I came here. I was fuckin blown away! I can't say enough about how much I love this site and how funny the stories from the light side are! I saw your letters to the editor section and had to give you something. So here it is.

I approached writing this article with a shred of hope that my complaint would be resolved and my money returned to me. However, after just one hour of researching and reading other people's horror stories, including extensive details from ex-PayPal employees, it's a given that PayPal has stolen money from me as per their standard operating procedure.

Several weeks ago, I realized I wouldn't have enough money to fly to Arkansas to attend my twin sister's wedding. Since I recently quit playing Everquest and had millions of platinum (the virtual currency in game) sitting there doing nothing, I decided to sell some of it to help make the money to fly home. I read up on popular scams and went into this with a paranoid outlook, knowing there was some risk when selling virtual property. I read that there was little to no protection when making these kinds of transactions and that caveat emptor wasn't the case anymore.

My first transaction was selling a small chunk of the virtual money for $75. The process was easy, both sides were happy, PayPal (our method of money transfer) made their slice of the profit. The second transaction was for a much larger chunk of the online currency, sold to a company that buys and resells such virtual property. They transferred $600 to my PayPal account, received the propertly, PayPal took their cut of the transaction, and everyone was happy. The third transaction is where the nightmare began.

A lady named "Reida Foster" wanted to buy some of the virtual money. While new to the site that caters to selling virtual property [4], her e-mails seemed legitimate and doing extensive digging produced a ton of information on her. I knew where she worked, where she lived, address, phone numbers and countless other personal details. When "Reida" provided this information, it all matched. When we met online in Everquest to trade the virtual property, her PayPal transaction came from "Reida Foster's" account, was verified through PayPal, and her e-mail address matched the one used to register her business domain. In short, this wasn't a garden variety scammer, rather it was someone that had stolen Reida's identity by compromising her PayPal account and likely her e-mail accounts since most transactions send e-mail confirmations. Since the money appeared from "Reida" quickly and she wanted to buy more, I sold off the rest of my virtual money in two more transactions. When all was said and done, she had transferred $900 to my account, enough to cover all the costs of attending my sister's wedding.

Event Money
First Sale (Person -> Me) 75.00
Second Sale (Company -> Me) 600.00
Third Sale (Scammer -> Me) 900.00
Sub-total 1575.00

Since my PayPal account did not have a verified bank account, I transferred a portion of the money to my boyfriend who I live with. His PayPal account has been around for years, has a verified credit card and bank account, and he would be able to give me the money within hours of the transfer, rather than waiting up to a week to verify my own account or waiting several weeks for a PayPal check.

The next day, I received the dreaded e-mails I had read about. "Reida" had reversed the charges on each transaction. PayPal put a hold on the $900 while it investigated the claims. Further, they put a reverse on the funds I had transferred to my boyfriend claiming it was a potentially fraudulent due to the "Reida" transaction. I called in to explain everything I could and answer any questions they had, but it eventually yielded nothing. The representative told me that once the "Reida" transaction was cleared up, and they verified my account wasn't hacked, they would unfreeze the rest of the money. They claimed that the locking of my transfer to my boyfriend was "protection for me".

Event Money
Sub-total 1575.00
Transfer (Me -> Boyfriend) -740.00
Reverse Charge ("Reida" -> Me) -900.00
My Balance -65.00

Several calls produced no information and there was no visible progress on the investigation. In an attempt to clear things up, we both called PayPal on the same line, had them verify both of our identities, and confirmed that the transaction was legitimate. Despite this, they still have the transaction reversed from his account and frozen on my account. PayPal has confirmed that the transaction was not fraudulent, yet they are holding that $740 transaction in limbo, like the $900.

Regardless of their decisions, $675 of the transactions have not been reversed, is not being contested, and are entirely legitimate. Despite that, PayPal has essentially locked all of those funds as well. After several more phone calls, both of us having to re-verify details about our accounts, and provide additional information, the money is still sitting in limbo, untouchable to anyone except PayPal. There are only two people in the world who can provide information for their "investigation" of this transfer, and any information we provide is ignored. Until this article, I was resigned to wait on PayPal to resolve the issue, but during my research I found out this is basically futile, all of the money is gone. One of the confirmations of this comes from an ex-PayPal employee and manager exposing their fraudulent practices.

After the "Reida" transaction was finally cleared up (they deemed it fraudulent and returned funds to her), I called back to find out why my transfer to my boyfriend was still locked and was told by a rude and patronizing associate that it was a seperate investigation because "no one transfers money to their roomate, that's weird". Not only did they change their reasons for locking the transfer, they told me it could be 45 days before the investigation was completed. During this call, she kept implying I was selling sexual services. When I explained exactly what was bought and sold, she pretended to understand and say that was fine. Minutes later, I received an e-mail saying my account had again been locked! Attempting to log in brought up the following message:

May 7, 2006: We have recently reviewed your account and have noticed that you are selling items on your website that violate our Acceptable Use Policy. We value you as a member of our community and wish to continue our relationship, so we ask that you remove all items from your website that violate our Acceptable Use Policy.

Please note that subsequent violations will result in the closure of your account. (Your case ID for this reason is PP-xxx-xxx-xxx.)

How can I return my account to regular standing?

To return your account to regular standing, please complete the remaining checklist items below as soon as possible. Each link can be clicked for more information on how to complete the step.

1. Submit Online Affidavit   [ ] To Do

Once you complete all of the checklist items, your case will be reviewed by one of our Account Specialists. We will send you an email with the outcome of the review.

This action and resulting message was pure harassment. My recent research has revealed that one of PayPal's methods of keeping your money is to find a reason, no matter how absurd, to lock your account so that they could wait out a 180 day period that would result in letting them keep the money. Instead of signing this "Online Affidavit", I called back and spoke to a more polite customer service rep. When I asked him what was going on, he told me that my web site was "selling pornography"! I asked him exactly what page he was talking about since my page only contains pictures of my cats. He replied that my site is selling "pornography" and that is why my account was locked this time.

The first thing I had to explain was the basics of e-mail addresses, domain names and web sites. Just because my page was hosted off some domain didn't mean it was my web site. By PayPal's logic, is responsible for anything found on The second thing I found out and had to explain was the "pornography" they found. Apparently, the lady I had previously spoken with was unable to read the page she deemed pornographic AND had to make a huge stretch calling it as such. The main domain where my website is hosted from makes a few custom wallpaper images available to anyone, absolutely free. The images are not pornography, rather digital art that comes with a detailed description on what tools were used to create it. For those who think this may be an innocent mistake, consider all the pages the PayPal employees visited on the domain to make this determination! Despite his acknowledgement that the page does not sell pornography, he says I must contact to resolve the matter. I find it very odd that PayPal would actively search for material they deem inappropriate to attempt to link to my account while they list PayPal Shops on their own pages that sell pornographic videos that violate the PayPal Acceptable Use Policy in regards to buying and selling items.

Based on PayPal's comments about my site, I inform the staff of what has transpired. Shortly after this, I receive a copy of an e-mail sent from Jericho to the PayPal compliance department making it perfectly clear that PayPal's comments were libelous and untrue. Since I was told the same thing over the phone, it is also slander. A few days later, I try to log into my PayPal account to find out the status of the "investigation" and see the following:

Affidavit of Compliance with and Acceptance of PayPal's Acceptable Use Policy

I have read and agree to the terms of use specified in the Acceptable Use Policy section of the User Agreement for PayPal Service.

I understand and agree that I am responsible for making sure that the transactions I enter into using PayPal are legal and do not violate the terms of PayPal’s Acceptable Use Policy.

I understand that my previous activities have been deemed by PayPal to violate the Acceptable Use Policy and I agree that if I do again violate the terms of PayPal's Acceptable Use Policy, my account access may be limited or my account may be closed without advance notice, regardless of whether the violation takes place through eBay or another online marketplace, through my own website, or through any other forum.

I also pledge that my current usage of PayPal is legal under the terms of the User Agreement and that I will not use PayPal in the future to accept payment for goods or services that are illegal or are prohibited as described by the Acceptable Use Policy or the Restricted Activities Section of the PayPal User Agreement.

Type "I Agree" here: ______________

By typing "I Agree" in the box above, I hereby agree to the terms of this affidavit.

Despite the issue supposedly being resolved, PayPal is forcing me to admit that I was selling pornography before they will unlock my account, even when it was proven that I was not. This is the text book definition of extortion. To gain access to my account and the chance of getting my money, I have to admit to a crime I did not do.

Three days ago I called PayPal back, to make one final effort to resolve the issue. I finished a second glass of wine to help deal with rude employees I invariably get, picked up the phone and let out a sigh. Since I had read a lot more about their tactics in dealing with customers, I found this call to be amusing and disgusting at the same time. Every single thing the ex-employees had posted were played out in detail. I was put on hold a dozen times, the first two people I dealt with kept saying they couldn't help, didn't offer to find someone who could, or seem to care beyond their basic duty to answer the call. After twenty minutes of frustration, I kept telling him "if you can't help, transfer me to someone who can right now". Eventually I ended up with "Scott" in "Resolutions Dept" who started the same routine and put me on hold. After I explained everything for the fifteenth time and asked him exactly why they were holding the legitimate funds, he couldn't provide an answer. He timidly asked "can we cancel the reverse of your transfer, would that be ok?", acting as if he knew I would say no. Since that would put the money in my boyfriend's account, where I wanted it all along, that was fine. "Please! That's all i've wanted all along!" and a few minutes later, it actually happened.

In summary, PayPal has once again gone to extensive lengths to cause problems for the legitimate user who has been scammed. Rather than work with me to resolve the issue, they held my money without providing an explanation as to their decisions and claims my transfer was fraudulent. No matter how many times I called, they refused to resolve the issue, and refused to provide me with a legitimate and legal way to resolve this. Only after spending countless hours over the course of two weeks and making dozens of phone calls did they finally realize I wasn't going away. Compared to several other people I spoke with during this saga, I was extremely lucky. They had to resort to filing a lawsuit to make PayPal return their money, or they simply didn't get it back.

I would advise anybody to stay far and clear from PayPal. I hope you guys are around a long time! Awesome work!

How to Sue PayPal and other Companies

Submitted by: Michael Guthenberg, ESQ.

I ran into your website quite unintentionally. However, I was drawn to it. I found it to be entertaining and informing. Therefore, as an attorney, I felt compelled to submit something to you and your readers. The following attachment is an article that I wrote which may be of some interest to you and your problem laden readers!

Consumers who have experienced unfair business practices from eBay and Paypal, e.g., where the companies refuse to live up to their buyer protection programs, may have recourse in a court of law. Typically unsatisfied consumers have bought a product on eBay or pay for it using Paypal only to find that the article is not as represented, is a different color or size than pictured, or arrives in a broken and unusable condition. When the consumer complains to eBay and Paypal and asks for a refund, both of these eBay-owned companies disavow any responsibility owed to the consumer.

This article will present a guide for consumers to prosecute eBay and Paypal for deceptive business practices that harmed them and what they can expect from eBay and Paypal in terms of defenses. At the outset, note that eBay and Paypal have managed to insulate themselves from damages claims through creative wording of their user agreements, which all consumers must agree to accept as a condition for using either eBay or Paypal.

Paypal, Inc., is a subsidiary of eBay, Inc., and the two companies are intertwined for purchasers of goods sold on to complete payments to sellers using The Defendants Paypal, Inc. and eBay, Inc., may be served with process (summons and a complaint) using the long arm statute of the consumer's state. The long arm statute most likely provides for service of out-of-state corporations through the state's Secretary of State. eBay's may be served with process at the following address: eBay Inc.; Attn: Corporate Counsel; 2145 Hamilton Avenue; San Jose, CA 95125.

Upon receiving the consumer's lawsuit, the defendants eBay and Paypal will advise the consumer that his or her user agreements with these two firms require the consumer to file disputes against the firms either with a court in Santa Clara County, CA, or with the National Arbitration Forum. If the consumer does not voluntarily withdraw his suit, then eBay will threaten to seek its lawyer fees to have the case dismissed. At this point, most consumers then drop their suits.

However, the arbitration clauses in the user agreements exclude claims for equitable or declaratory relief. Accordingly, if the consumer files his suit from the outset seeking equitable or declaratory relief, then the eBay user agreement defense will NOT prevent the lawsuit from going forward. With the lawsuit proceeding forward, the consumer can send eBay or Paypal interrogatories to seek discovery. Interrogatories are written questions sent to a party to a lawsuit that must be answered in writing, usually within 30 days. With interrogatories, the consumer can get access to information about the seller, as well as the frequency with which consumers have complained about items being delivered that were materially different from the item pictures on eBay.

The consumer's local state court will have personal jurisdiction over the eBay and Paypal to hear claims for equitable and declaratory relief, because these firms have established substantial contacts the consumer's state. The following non-exhaustive list of activities and contacts by the eBay and Paypal in and with the consumer's state make it fair, equitable, and convenient for eBay and Paypal to defend these causes of action in the consumer's state:

(1) The controversy arose out of the consumer's purchase of some item on, which was shipped to him or her at the consumer's address, and which arrived damaged and unusable. The funds used to pay for this transaction were drawn from a bank in the consumer's hometown, and payment for this transaction occurred in the consumer's hometown. The contract to purchase the item and pay for shipping was most likely formed in the consumer's hometown.

(2) For more than 10 years, eBay and Paypal have systematically and continuously advertised their services to the consumer and other Internet users in the consumer's state via advertising and electronic mail. Over the years, eBay and Paypal have collected fees on scores of millions of dollars in payments and seller fees from businesses and residents in the consumer's state.

For circumstances in which a seller refuses to take back damaged merchandise and issue a refund, the consumer can seek equitable relief to bar that seller from any and all further transactions on the eBay and Paypal platforms. The consumer can seek declaratory relief that eBay and Paypal's Buyer Protection Plan submission forms are riddled with computer errors and will not allow users to properly submit claims.

The consumer should also seek declaratory relief that eBay and Paypal's fraud violated the state Consumer Protection Act, which thus gives the consumer a statutory right to prosecute eBay and Paypal independent of any breach of contract claim he or she may have related to the user agreement.

The consumer can also challenge in his local state court the validity of the arbitration clause as unconscionable. A claim that the arbitration provision is unconscionable is a matter to be decided by the courts and not the arbitrator, because it specifically challenges the validity of the agreement to arbitrate irrespective of the validity of the whole contract. If the state trial court determines that the arbitration clause is unconscionable, then the consumer will be entitled to pursue monetary damages against eBay and Paypal. However, it is unlikely that a state court will find the arbitration clauses unconscionable, due to the pro-business tilt of the U.S. court system.

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