PayPal
$3,471 Frozen and Account Closed After Game System Sales

I have been an upstanding PayPal account holder for more than 4 years and have not had a complaint in over a year (out of more than 100 transactions in that time), and the one a year ago was not legitimate.

I have also been an eBay auction account holder for more than 5 years. I have a current feedback rating of 757 and have not had a negative in more than a year. That is my credible background.

About 3 weeks ago, two friends of mine noted that two different game systems (the Nintendo DS and the PlayStation 2 slim version) were selling on eBay at much higher prices than they could be purchased for in stores. Target, Wal-Mart and other stores were selling them at the suggested retail price of $149.99. These two systems were selling for an average of over $200 apiece on eBay plus shipping. The reason for the high price was a shortage across the country and high demand only a few weeks before Christmas.

So we decided to see if we could acquire some of these items and resell them to make a few extra dollars. We made a deal that if my friends purchased the items, I would list and ship them, since my high eBay rating would help make me a credible seller. My friends managed to scrape together a total of 38 systems after driving to every Target, Wal-Mart and Best Buy within 100 miles.

I listed about 6 to 10 a day, and they were selling pretty well with a 1-day listing and a guarantee to have them delivered before Christmas. As the items were paid for, I transferred the money from my PayPal account to my regular bank, and I was going to withdraw it the traditional way to split it up. I made good on my shipping promise as well, and I shipped every item within 24 hours of payment, and in most cases the same day.

I insured the packages and was going to put a delivery confirmation on each one also, but the post office told me it was not necessary since I was insuring the items for more than $50 ($150-230), because they said they could track it with the number on the insurance slip. I was fine with this, and everything seemed to be going smoothly. I had sold 32 of the systems, as well as several other items of my own, just to make some extra Christmas cash. Then on Sunday, Dec. 19, PayPal put what they called a "Limited Access" on my account due to what they termed "Suspicious Activity," stopped all transactions of money, and even reversed some of my withdrawals.

I was asked to send them a good many items via fax: a copy of my driver's license, my Social Security card, copies of proof of shipping, my business account number, proof of inventory for the items being sold (the game systems), and an expanded use number via a credit card billing they did to my card. I did all of these things, and I called them 6 times to try to get to the bottom of this.

Every time I was on hold between 20 and 65 minutes before talking to someone. The first three times I was told to just send in the required information and a review team would make a determination in 3-4 days. They could not give me an answer as to why all of this was going on other than "an increase in activity in my account." I was unsatisfied with that answer, and on the 4th and 5th calls I requested to speak to a supervisor. Both times I was put on hold for 20-30 minutes and then given a voicemail recording to leave a message. I did so on both occasions, requesting a return call, but I received none.

The 6th time I called, I told the person I wanted to speak with a supervisor and not get voicemail. An hour later (I am not exaggerating), I spoke with someone who told me there had been a great deal of fraudulent selling of these systems lately on eBay and that they were holding my account as a "precautionary measure" to protect themselves as well as my buyers.

I told them I had sent ample proof of mailing these items and that they were welcome to contact any of my buyers to see if they got their item. They told me I had to have a delivery confirmation tracking number, otherwise they could hold my money for up to 180 days "just in case" anyone filed a complaint. At this point they had $3,471 held in their system that I could not access. I told them I did not see how this could be legal, and she read me the user agreement, which has a very vague statement that, according to them, gives them the right to do this without any reason. I was stunned.

I went through a very long and drawn-out process of proving the items were shipped, and the woman told me she would not release the account at that time but they would review it, and I should hear something in a few days. She said they would email the buyers to get feedback on whether or not they received the items. I said that was fine.

I waited two days, and today, Dec. 22, I finally got an email that said, "Paypal has decided to discontinue doing business with you. Your account will be closed and the funds you have available can be disbursed by one of two means." I was given the choice of either refunding the money to my buyers or waiting the 180 days and they would send me a check. All of this was done to me when I had done nothing illegal, and neither PayPal nor eBay had received any complaints from anyone. Just like that, I was stuck with a loss of the $3,471 in the account they are holding, the fees they charged me to take that money, the eBay listing fees, and the shipping fees. My total loss was over $4,000.

It is now December 22, and I am searching for help with this problem. How can they do this without any reason? As stated, I have done absolutely nothing illegal, and I have all of the evidence to prove it. I even sent eBay a request to look into this, but they probably will not help since they own PayPal. I told eBay they could contact every buyer I have had for the past year to see if they were satisfied.

Anyone who can advise me, please do so, because this is completely unfair and I am sickened by this entire thing only days before Christmas. My friends and I can hardly afford this kind of loss. Almost all of the items were purchased via credit card, with the intent to pay them off as soon as payment was received. Now we are all left wondering what to do.

Company: PayPal
Country: USA
State: Nationwide
Phone: 8882211161
Site: paypal.com

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