LOL buddy where I come from you don't disclose an extremely profitable niche on a public forum online where the majority of the community is familiar with ecommerce and business online is general. I'm not saying what I sell because I don't need 10 more competitors. What I sell is 100% legit, it's been approved on Paypal, it sells by the thousands daily on both Amazon and Ebay.
This particular public forum also has a lot of people who know that a lot of "100% legit" digital-only crap sold on Amazon and eBay is anything but. Does that describe your product? Only grandma knows...
It's a physicial product with proof of tracking shipped from the USA man. It's an accessory that retails in countless physical stores. You're just trying to find a way to delegitimize my story and that's fine but it would be nicer if you asked questions instead of just calling bullshit with no back up.
Can you give us an idea of what type of accessory it is? Or at least, what are the concerns you had about quality? Is this something you have commissioned a manufacturer to build? Is it a dodgy supplement with claims that aren't backed up by science?
An update for anyone who cares...I tweeted this link and tagged Paypal, they reached out saying they are sorry to hear and submitted my case for a review. I replied via DM how can they review ny case without asking any new information or telling me what the issue is, got no reply back. Just got an email saying "Appeal Denied" Paypal account closed for security reasons.
Which security reasons I have absolutely no idea. There's no contact info on the email, just says it's a do not reply address.
No idea, clearly they aren't paying attention to anything I say and just send automated replies. No one to talk to, nothing to do. I'm assuming complaints with different organizations to see if they can help.
I learned this lesson years ago when I was 12 and selling some software online. Paypal for no reason froze my account which still had 300$ in it (which is a ton of money at that age!). All appeal attempts failed, and they just didn't give a shit. I vowed never to ever do anything related to Paypal again (hence I don't use ebay). They're a scumbag company.
I have a CAD Paypal account - but I charge customers in USD. To withdraw money I have to pay Paypal's exchange rate, they won't let me attach a Canadian USD bank account. That means I have to pay exchange rate to take money out, then pay exchange rate again to convert the money to USD to pay my supplier and Facebook Ads in USD. It makes much more sense keeping my money in Paypal, that they are a fraud of a company is a different story.
Have you thought of setting up a USD account with a US Bank? Canadians can do that without a problem at most branches near a border, and I expect it could be done remotely. Another alternative is to set up an account with RBC(USA) https://www.rbcbank.com/banking-in-the-us/checking-accounts/....
I think people use Paypal because it's easy to use in general, not because it makes tax evasion easier (I suspect it's a pretty dumb choice for that :) ). Taxes need to be paid regardless of how the money get brought into the country, and Canada and the US have a pretty well understood tax treaty.
When I opened up my account at the BOA, it seemed to be a very well used and smooth process - they mentioned that the number of Canadians holding accounts at that branch (close to the border) was a significant percentage of their total. I really doubt it raises any red flags on it's own - there are a lot of legitimate legal reasons for the arrangement.
Yes, when I was advertising I was doing close to $300k a month - I advertised on FB, there are still thousands of people who have my shared ad on the top of their newsfeed to this day. On top of that, I rank #1 on Google for my main keyword..
Not sure what kind of volume you were doing to get that chargeback rate. I was doing 500 sales a day, approximately $250k a month in volume when I was running, my dispute rate was high but chargebacks lost were minimal. Despite that, Paypal were aware of my dispute rate when they negotiated the terms of our agreement ($5000 set reserve + 10% rolling reserve) - they then woke up one day and closed my account without letting my appeal or negotiate or provide any information. I just get the run around...
Of course, many do in fact. Despite that, Paypal saw my high-dispute rate and worked out a plan where they will have a set reserve of $5000 + a 10% rolling reserve in order to mitigate risk and work with me. They then called me on 3 separate occasions to ask questions and see how the business was going, not once did they say my dispute rate is too high for them or that I'm at risk of losing my account. They just randomly gave me the hammer one day and use automated emails to circumvent any request I may have. They are inconsistent, rude, lying and simply provide 0 customer service while holding my money simply because their "system" said so!
No mainstream cc merchant account bank and payment processor will accept 1%+ chargebacks.
That type of account is categorized as "high risk" and you have to resort to processors that specialize in that area (e.g. adult, gambling, etc). One example says they can handle up to 3% chargebacks.[1] They will definitely make you pay for that privilege in multiple ways: higher setup fees, higher monthly service fees, higher transaction fees, higher reserve, longer hold times before releasing funds to you, etc.
I'm frankly astounded that PayPal was willing to let a 2% chargeback go on as long as you said they did. All my previous reading about PayPal's contentious relationship with VISA/MC network & member banks was that they do not want to be associated with "high risk" accounts.
Shopify doesn't allow Stripe, they force you to use Shopify Payments which I have no interest in using, they set their own rules and guidelines that I do not approve of.
For one, Payouts are 7-days in arrear where as with Paypal it's instant. Second, Shopify just started with this processing thing and they are amateurs at it, support has been horrible and they also keep changing their rules and requirements since this is all new to them. The shopify payments team also does not get on the phone, just email, i try and stay away from companies that do that. The irony is paypal just did it to me...
Sorry for the delayed reply, HN wasn't letting me comment. You don't seem to understand that Paypal agreed to my 2% chargeback rate, in fact they came up with the $5000 set reserve + 10% rolling reserve in order to let me run. Not once did Paypal tell me I'm at risk of losing my account or getting my funds frozen for 6 months. I have had 0 warnings. The issue here is bigger than that, it's the inconsistency in what they request, it's Paypal requesting information but not letting me provide it, it's Paypal's inner departments not speaking to each other and every time you call in you get different information. When I log into my account it still says it's limited because Paypal needs more information regarding recent sales, but guess what, they don't tell you which information they need or how to provide it. Paypal was aware of my high dispute rate and agreed to work with me based on the reserve they wanted which I accepted. Not once did I receive a warning contrarily to what you may think.
I hear from my MSP all the time about security improvements that need to be made, changes to visa/etc networks, rate changes, etc.
The number of times I've had an MSP call me to discuss fraud in the past 14 years I've had one or more merchant accounts: 0
The number of times I've had an MSP establish a reserve line for my account: 0
The chargeback rate for an ecommerce site I've run for 14 years: 0.1% (about 1 every 1000 orders)
MSPs don't normally contact their customers to discuss fraud. They don't normally require reserves.
Every time they contacted you about the chargeback rate was a warning. When they set the reserve line that was a warning. You didn't negotiate the right to the chargeback rate.. you negotiated how severely their anti-fraud control would impact your business.
These were HUGE red flags. Possibly the biggest red flags you could have gotten, short of a legal notice or the immediate closure of the account.
And while it sounds like PayPal should have been more direct with you about the consequences here... I can tell you that every MSP agreement I've ever seen specially talks about these actions as negative actions they may take to mitigate the risk of fraud.
Paypal prides itself on being the safest payment solution online, they have easy integrations with Shopify. I don't breach their terms or perform any fraud so had no reason to suspect I'd be treated like a criminal and given inconsistency and lies by a multi billion dollar corporation I've paid thousands of dollars in fees too!
The fact that PayPal claims to be the safest payment solution is pretty irrelevant, especially if it's meant to be safest for the buyers and you're the seller. This is not the first story of PayPal freezing accounts with substantial amounts of money and not talking to the account owner.
Also, their ToS are pretty clear that they can do whatever they want, based on their beliefs, and there are no explicit limits how long they can keep your funds, or even obligations to talk to you. It might work differently in the EU, where they are registered as a bank (and so are regulated as a bank), but in US that's not the case IIRC.
The behavior is not all that unexpected - it's easier and cheaper to loose a customer receiving a lot of complaints than to inspect each of the complaints. So while I understand this is pretty damaging and dislike what PayPal does, I'm surprised that people are surprised.
Corporations still manage to maintain the illusion of decency and customer service. Their real behavior is surprising to a) people who were lucky and have never encountered it and b) people who suffer from some corporate equivalent of Gell-Mann amnesia.
I belong to the second category. Also, it becomes harder to avoid such companies at all, for example cell phone operators in Europe universally view their "customers" as billable addresses; some find it cheaper to settle billing disputes in court (and lose a great percentage of the cases) than to maintain a "customer" service.
Corporations still manage to maintain the illusion of decency and customer service
I'm baffled by this. Paypal does not. 28 days ago I wrote this comment on HN: https://news.ycombinator.com/item?id=13624393. I'm sure that in the future I'll be reading another Paypal horror story from someone like you, who somehow thought, "It won't happen to me!"
Same here. Most people tend to downplay risks "because they're big", but there are alternatives and it's worth missing a few opportunities for a lower risk.
E.g., I don't go to USA conferences because of the TSA risk, people find it funny, yet I keep hearing horror story after horror story. For Paypal, though, people take the risk unknowingly because they aren't aware of Paypal's reputation, which is more understandable.
Well, people don't realize a lot of the bad stuff actually makes business sense. It's not that the companies are meant to be evil, but once you are a customer, they have little to gain from treating you as well as potential customers.
For example, once you subscribe to a cable TV / cell phone operator / whatever, they'll keep you on that subscription until the contract ends, even if new customers can sign up for half the price. And even then it's a matter of how much you spend with them and if it's worth negotiating a better contract.
This has little to do with the corporations being intentionally 'evil', it's more about insufficient competition or even monopoly (how many cable TV operators / ISPs are in your area?). We have multiple cell phone operators over here, but they have little incentive to compete - the number of people leaving/joining each operator is about the same, and if one operator decreases the prices the others will do the same, eliminating any advantage.
Paypal also has a reputation for unpredictability and politically-motivated action against users. The rise of cryptocurrencies in recent years was largely a result of how paypal and credit card companies reacted to US government "requests" (ie the blacklisting of wikileaks and vpn providers). Nobody can stop or confiscate a bitcoin transaction.
Given the regs that paypal thinks it must abide, specifically the many vague US antiterror rules, anyone getting into bed with them runs massive risk. The internet is full of stories exactly like this. The only hope is to rally enough of social media, or a tv show, that a human being at paypal takes pitty in you.
That isn't really an answer to the question OP was raising, although I do sympathise with you. Having said that, Paypal is known to be very evil, and because of this I do expect people whom are still using Paypal consider this behaviour a calculated risk, rather than a surprise.
The company has been successfully sued over "improper account holds" (See Zepeda v. PayPal) and the internet is utterly jam packed full of stories like yours. I don't see why people find it surprising at this point.
