I have filed complaints with my states Banking Commission against PayPal
I have been selling on eBay using PayPal for close to ten years. All my sales have been for the most part related to my vintage motorcycle hobbie. In August of 2011 I invested a large sum of money to purchase a large inventory of vintage motorcycle parts with the intention of selling them online.
My sales have averaged about $3500 a month consistently over the last 12 months or so. I have had no instances of fraud, credit card chargebacks or anything other than a lower than average % of returns based on item different than described. In those instances we ask no questions and just issue a refund of 100%. A very liberal return policy. We have this because our parts are all obsolete and if they are returned someone else will buy them.
About 6 weeks ago I started selling a few items in categories outside my normal eBay motors/motorcycle parts category. When I listed the items a message suddenly came up that said by listing these items you agree to up to a 21 day hold on funds. Sure enough when the items sold the money was not available for “up to 3 days after delivery” of item. Within a few weeks Paypal was holding over $4000 from the proceeds of these “off category” sales. Obviously this created a cash flow emergency for my small business. To make matters worse when Paypal needed to either freeze funds for a return or get paid for their monthly fees, even thought here was more than enough money in my Paypal account, albeit frozen, Paypal then removed money from my linked local bank account to cover these fees. This caused a cascade effect my local account was overdrawn and$3200 worth of checks I had outstanding bounced. The fees involved were in the hundreds of dollars. PayPal would not release the funds they froze even after the items were successfully delivered and the three day waiting period had passed. It wasn’t until I called for each transactions that the money was released. On overseas shipped items the freeze is sometimes a month or longer. This is because there is no way to verify shipment for overseas shipments so Paypal waits the maximum time to pay you for your own item.
This whole experience has turned Paypal into my most hated company. They are not out to help me be successful or to be a partner. Quite the contrary,their tactics are a detriment to my business. It makes no sense to do business with an entity that is adverse to your business. They blame this 21 day hold on my companys eBay DSR Detailed Sellers Ratings which is a metric system of five detailed ratings provided by buyers. In all but one of these five metrics we are a fraction of the standard EBay sets. In one we are .10% points-one-tenth of one percent higher than we should be.
So for that I pay by having Paypal steal my money legally for 21 days. Take someone’s car without their agreement take someone’s cash for 21 days and then when the police come to arrest you explain that you were going to return the item in 15 days. Guess what? You will still get arrested. PayPal does this legally until now. I have filed complaints with my states Banking Commission which is very motivated to see this illegal practice stop. I have since setup a merchant account and have eliminated Paypal from my business model. I am doing fine. I would advise other small online businesses to look beyond PayPal as their only source of payment processing.
Filed a dispute and submitted everything required and got nothingNever recd my item. Told me to file a dispute which I did. Told me to sign and fax an affidavit of non-receipt of goods, which I did. Told me to file a police report...
Posted: July 25, 2012 at 3:42 pm