PayPal limited my account on 1-17-09 due to high risk activity. I've been a PayPal member for 6 years with few issues. I was told that if I supplied the requested info, my account would be reopened. After I supplied the requested info on 1-21-09, PayPal replied on 1-23-09 stating that there was a hold of 3 days until delivery confirmation was reviewed and the buyers had to respond if necessary.
Since my entire business uses PayPal for payment processing, my business was closed for 11 days during this time. I kept being told my account would be reopened. On 1-28-09, I was told that after reviewing my account, credit report and so on, my account would be closed permanently. So after 11 days I have no way to continue my business. I have always covered any fees, refunds, etc. without problems. After 6 years of using PayPal and paying its fees, my account is now closed, with funds being frozen. I have no way to pay bills, feed my 3 children or make any payments to anyone.
They told me that my credit report made me high risk and that the chargebacks also caused the issue. The reason for this is that sales were down considerably in 2009, and eBay closed my main seller account in November of 09 because I was not able to pay my eBay fees of $2800 in full. This caused my sales to decrease significantly and the chargeback ratio to look really bad.
My company had sales in the $1000000 range the past 5 years, so we have paid enormous fees to eBay and PayPal over the years. How can PayPal get away with freezing an account based on a credit report? Small businesses like mine are being ruined by PayPal each day. And nothing can be done about it?
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