[HN Gopher] PayPal blocked Flipper Zero account with $1.3M
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PayPal blocked Flipper Zero account with $1.3M
Author : Dzheky
Score : 122 points
Date : 2022-09-06 17:04 UTC (5 hours ago)
(HTM) web link (twitter.com)
(TXT) w3m dump (twitter.com)
| burnyburny wrote:
| unpopularopp wrote:
| Probably because they are a russian company [0]. Yes they have an
| Inc. in the US but most likely the money goes to Russia. They are
| violating some sanctions.
|
| 0, https://twitter.com/flipper_zero/status/1503384490026151938
|
| 0, https://www.flipperdevices.com/jobs
| James_Kirk wrote:
| They are not Russian taxpayers. Also half of the team is
| Ukrainian.
|
| And the main issue is the silence from PayPal and complete lack
| of communication.
| justsomehnguy wrote:
| I would say what the main issue here is what PayPal allowed
| them to establish a business account (June 7th) and happily
| took money from their customers. Now both the company AND
| it's customers are fuc^W scammed out of their money.
|
| Seems like Stripe doesn't have a problem with them (because
| they are incorporated in Delaware, not in Russia?)
| James_Kirk wrote:
| They have been US company long before the war. You are just
| saying they are affiliated with Russia just because they
| have many Russian employees? That's right?
| Anon659 wrote:
| No, because they have an office in Moscow and the money
| ends up going to Russia.
| millzlane wrote:
| Wasn't the company started by a Native Russian? I
| remember the kickstarter.
| https://www.linkedin.com/in/zhovner
| James_Kirk wrote:
| So was Google by Sergey Brin, who was born in Russia, so
| what? :)
| millzlane wrote:
| He was not a Russian citizen living in Russia during that
| time. So there is a huge difference.
| James_Kirk wrote:
| So what's your point then? Everything made by a Russian
| is bad or what? :)
| nora-puchreiner wrote:
| Flipperzero could have shown more Ukrainians than
| Russians, but... America could side with the Russians in
| the conflict and discount the Ukrainians.
|
| so "Everything made by Americans are bad and unreliable
| for foreign users"
| ergocoder wrote:
| It's a US sanction. Yes, it would be bad for the employee
| who makes the decision that this account isn't within the
| sanction's scope. If US government disagrees, the
| employee will likely go to jail.
|
| It's expected for companies to overdo the sanction
| considering that under-doing could get employees a long
| jail time.
|
| Plus, Paypal employees get paid the same whether or not
| Flipper Zero is within the sanction's scope.
| shswkna wrote:
| What is your point?
| blinkerdisc wrote:
| blinkerdisc wrote:
| justsomehnguy wrote:
| > You are just saying they are affiliated with Russia
|
| And where did I said that?
| James_Kirk wrote:
| Sorry, I misinterpreted your message
| filoleg wrote:
| The team is ethnically split between russian and ukrainian,
| but that's about it. The company was set up as a non-
| russian entity way before the war, which is why sanctions
| didn't cause them much problem when they started shipping
| the product. Shipping was done through Hong Kong, the
| manufacturing process (which they went into crazy details
| about in their blog posts) is done in China.
|
| I don't think the whole "they are a russian company" makes
| much sense as an argument here. For one, it would he
| helpful if Paypal actually tried explaining their
| reasoning, instead of staying silent.
| nora-puchreiner wrote:
| They had a similar issue with Stripe few months ago which
| was partly resolved (Stripe unblocked 70% of money which
| was enough to them to go on with production).
| 404mm wrote:
| Or could it be because of their product?
| https://flipperzero.one I'd not be shocked if their product
| danced somewhere on the line of legality. In a similar way that
| as it's illegal to own lock pick set in some states, which can
| be also considered a personal pentesting hardware.
| rchaud wrote:
| Unlikely. The tweet thread says they asked for compliance
| information related to the business (address etc), which to
| me indicates it was sanctions-related.
|
| I don't understand how they left $1.3m sitting in a single
| account however. Surely they're not paying for bulk h/w
| component orders through PP.
| nora-puchreiner wrote:
| What is sanction-related is SWIFT almost frozen in Russia,
| for all entities, irregardless their presence in sanction
| lists. So, if one have money on PayPal, he cannot move it
| to a bank easily. And then cannot pay from that bank back
| to a Western contractor. Ironically, as the result of that
| cross-border slowdown, Russians now have big account
| balances on PayPal.
| kweks wrote:
| It's not as cut-and-dry as it seems. Noone leaves 1.3M in
| an account. When your account starts generating income,
| they place a 'light hold' on the account - requesting
| 'reasonable' information.
|
| During this time, you can still receive funds, and you're
| promised quick resolution. You provide the documentation.
| They drag their feet. They request more information. They
| drag their feet. All the while, your account has
| accumulated more funds that you can't access.
|
| Then, they'll request something impossible, ie: give us
| proof of _delivery_ (not shipment) of these 500 orders.
| Inevitably, there 'll be one order that was returned / was
| delivered without signature / etc.
|
| You'll try to reship the customer, but you've got a 3 day
| deadline. You miss the deadline, and the account gets
| perma-frozen for 180 days, but you still believe you'll get
| your funds back.
|
| 180 days later, you'll be notified that your funds aren't
| eligible for return, because you cost them the equivalent
| of what was in your account due to the time invested by
| their legal and risk teams - because buried in their T&C
| they evoke Common Law allowing for punitive damages for T&C
| transgressions.
|
| It's calculated extortion to seize as much money as
| possible.
| rchaud wrote:
| Good to know, thanks
| valdiorn wrote:
| Anti money laundering laws forbid banks and facilitators from
| disclosing the true reason for freezing the account.
|
| If PayPal told them they'd literally be breaking federal law. So
| a money laundering flag seems most plausible given the silence.
| geoffeg wrote:
| So what's the resolution in that situation? Does Flipper Zero
| just throw their hands up and lose the money?
| rchaud wrote:
| They can go public, which is what they've done here and on
| Twitter.
|
| After that, they have to consider legal action, and it won't
| be cheap.
| more_corn wrote:
| I had a PayPal support person flag my account for fraud because I
| asked to speak to her manager regarding a minor annoyance with
| the way she was handling my case. (She refused and my account was
| immediately flagged for fraud, my project was paused and they
| ultimately unblocked it because obviously no fraud was happening,
| but by this point we'd lost all momentum. I'm 100% certain she
| did it because she was annoyed with me, I also know there's not a
| thing I can do about it)
|
| I'd never trust PayPal with a nickel let alone over a million
| bucks.
| popcalc wrote:
| Yikes. Probably has something to do with a regex on the word
| "hack".
| Anon659 wrote:
| This is a Russian company with an office in Moscow. Blocked and
| done right.
| Rebelgecko wrote:
| https://twitter.com/flipper_zero/status/1503384490026151938
| fortyseven wrote:
| anm89 wrote:
| I'm not justifying this on any level but I'm also starting to
| lose sympathy for businesses who get screwed by Paypal. Screwing
| people by freezing accounts is Paypal's MO. It's their signature
| move. It's their default behavior. This isn't even remotely
| secret.
|
| If, after knowing that, you choose to keep your money with that
| business, that's to some degree on you.
| kweks wrote:
| PayPal performed a "freeze and seize" on our account ~12 months
| ago, netting just over 50k EUR. They then went on a war of
| attrition, enumerating across distinct companies, shareholders
| seizing funds across all accounts (including accounts of
| unrelated companies and personal accounts in Hong Kong and
| Australia)
|
| No information was given. After the 180 days "freeze" period,
| they announced that the funds would not be returned, ie: they
| stole the money.
|
| We lawyered up. Their legal team refused to acknowledge official
| communications from our lawyers, citing "Customer Privacy
| Protection".
|
| When we turned up the heat, we were told that our French lawyers
| (for a French company, and a French account) had no jurisdiction
| - the account was managed by PayPal Luxembourg.
|
| We retained Luxembourg-based lawyers. PayPal Luxembourg refused
| to communicate with the lawyers, regurgitating "Customer Privacy
| Protection".
|
| We lodged a complaint with the CSSF, the Luxembourg monetary
| watchdog. PayPal finally replied via the CSSF, citing that our
| account was selling illegal products, ergo the proceeds were
| illegal, ergo PayPal deserved to keep them.
|
| None of the products they cited were ever featured on our site.
| They included screenshots of other sites. When this was
| transmitted to the CSSF, PayPal silently released all funds owed,
| but continued to defend their position.
|
| We are now pursuing damages; PayPal Luxembourg is now claiming
| that the CSSF has no jurisdiction over them, because the accounts
| are French / HK / Australia.
|
| PayPal has an active policy of abuse and racketeering. They know
| the legal system. They use multiple jurisdictions in their T&Cs
| to maximise and legalise their theft (IE, PayPal Luxembourg cites
| UK law in the T&Cs to allow punitive damages for perceived
| breaches of their illegal contracts).
|
| They know the legal system, and use their multi-national entities
| to avoid oversight from watchdogs. They know customers don't have
| the resources to pursue them. We've spent well over 100k to
| recover 50k, but someone has to stand up to these thugs.
|
| If you're in a similar situation: Don't be intimidated. Get
| lawyers, and pursue them via the monetary authorities in your
| country. They have made theft a business model; apply pressure on
| the entities that can apply pressure on them, and you'll have a
| good chance to get your money back.
| TAForObvReasons wrote:
| You spent well over 100k and recovered 50k.
|
| If you were also compensated for your legal expenses in the
| process, then sure "don't be intimidated" is a calculated risk.
|
| If you didn't, then it seems like you are a loser either way
| and should just encourage customers not to pay with PayPal.
| Sharing the story with your customers and other developers does
| more damage to PayPal than fighting.
| rchaud wrote:
| Please consider writing a blog post online, so there's a
| permanent link to your story online somewhere.
|
| You have described a pretty elaborate system designed to dodge
| accountability when customers ask questions. You should
| consider talking to a business journalist as well. Here in
| Canada, the public broadcaster's website has a "Go Public"
| section where well-documented customer complaints are
| publicized. In most cases, the company pays up what it owes,
| but only after the story becomes public.
|
| https://www.cbc.ca/news/gopublic
| suction wrote:
| tester756 wrote:
| What's the safest way to transfer money relatively anonymously
| nowadays?
|
| by relatively I mean that I don't care if gov/police knows, but
| the person who sends/receives money doesn't know me, I just don't
| want people from games to know me
|
| I've used paypal account with random name like Snarky Snark
|
| and managed to transfer like 300usd, but I'm worried that the
| next time they may block me somehow
| CyanBird wrote:
| > transfer money relatively anonymously nowadays
|
| Monero and that's pretty much it
|
| Russian banks are managing deposits in etherium, and if you
| want you could send money over in alt-coins, bounce it around
| through other alt coins some and then retrieve it elsewhere,
| issue is that you will lose a fair bit on the exchanges with
| the rates, transaction fees etc
|
| Also, you will need atleast a visa/mastercard internationally
| enabled card associated to a bank to your name to do any of
| that. Do that, or buy it personally/insitu from someone
| anm89 wrote:
| Zelle / venmo are better in cases where you are withing their
| account limits AFAIK. I'm not aware of either of them having
| the history of seizing user funds that Paypal has.
| ntauthority wrote:
| Somewhat regrettably given the connotations also associated,
| cryptocurrency. In countries where there are legal, regulated
| exchanges, this _pretty much_ meets the requirements there.
| [deleted]
| shswkna wrote:
| I am not familiar with Flipper Zero, but I can attest from first
| hand experience that Paypal does not really care about its
| customers.
|
| I struggled for 3 months to get Paypal to pay out a odd $300
| which I received as a refund because I cancelled a newspaper
| subscription. I am not in the US and had a Paypal account linked
| only to my credit card.
|
| Paypal said that due to financial regulations in my country my
| Paypal balance may not be used at all - no withdrawals, sending
| it somewhere or paying with it. I may only make a payment via my
| credit card.
|
| In the end I only got my money after requesting to close my
| account - and since they could not keep my money, the matter was
| escalated higher. But not before they in all seriousness
| suggested that I donate my money to an official Paypal charity.
| dmitrygr wrote:
| Even suing them isn't necessarily going to work. Eg, a class
| action against them this year ended with a whimper when a CA
| judge granted their motion to compel arbitration as per their
| ToS: https://casetext.com/case/evans-v-paypal-inc
| intrasight wrote:
| Why on earth would anyone do business with PayPal after all the
| shady dealings that have been reported over the last ten years?
| TheLoafOfBread wrote:
| I am having vivid flashbacks from my fights with PayPal. I would
| rather have account at random American bank and going personally
| to bank to make SEPA payments than ever expose myself to PayPal.
| Cr4shMyCar wrote:
| PayPal doesn't care. A lot of artists use it for commissions,
| since it's really the easiest way to send money from person to
| person, and I've heard so many horror stories of artists getting
| their accounts locked for no apparent reason. Some of em get
| their accounts back after making a big enough fuss on Twitter,
| but most don't.
| tinus_hn wrote:
| In other news, using a payment provider with no contracts and no
| guarantees for collecting $1.3 million is not a good idea.
| CosmicShadow wrote:
| This really sucks, I was interested in getting one of these when
| they come back into stock for my country.
|
| Another notch in the "never use PayPal" belt.
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