[HN Gopher] Tell HN: Do not store any funds in PayPal or use the...
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Tell HN: Do not store any funds in PayPal or use them for anything
critical
I know this has been covered over and over, but I always thought
there must be more to the story when someones account was
permanently banned. Well, it happened to me, one of the most plain
and boring consumer users of PayPal ever. I have used PayPal for
over a decade, usually once or twice a month to make small
purchases when buying something off Craigslist or Facebook
marketplace. I also occasionally use it to split dinner with
friends. I don't use it for business and I don't use it for
anything sketchy. I recently received an email from PayPal saying
that my account had been permanently banned. No appeal, no reason
given. I logged in separately to make sure this was a real email,
at first I thought it must be phishing. It was real. The only
thing I can think of which might have precipitated this. I got a
few invoice requests though PayPal a while ago from
people/businesses I had never heard of. This is a well known and
documented scam where they spam invoices en-masse and hope some
people pay them accidentally (I did not pay them, but the PayPal UI
makes this very easy to do and there is no way to decline or
dismiss the requests). Not a big deal for me since I don't use
PayPal for anything critical, but I figured a reminder was in order
in case anyone still thinks it won't happen to them. If it could
happen to me, it can happen to anyone.
Author : ciguy
Score : 581 points
Date : 2023-02-23 17:29 UTC (5 hours ago)
| rdedev wrote:
| I had created a PayPal account and tried to use it to get money
| off from a gift card (read online that it might work). PayPal
| banned me for it even though there was possibly no other activity
| in the account. I was able to get it unbanned after reaching out
| to customer care. For them false positives is just the cost of
| doing business
| H1Supreme wrote:
| I just use Paypal as a proxy to a checking account. No funds are
| actually stored there.
| Moonman08 wrote:
| You also can't report the spam requests via PayPayl's UI. I
| received one of those requests, and the only way I could report
| the spam was via an email. PayPal is garbage.
| code_duck wrote:
| > there is no way to decline or dismiss the requests
|
| I used PayPal as a primary payment source for a business I had 10
| years ago. I'm still receiving messages about someone "canceling
| a payment request" from 2010, so there is definitely a way to do
| so.
| throw8383833jj wrote:
| everytime i see something like this I feel disgusted about using
| paypal. I'll definately sweep funds out of there even more
| frequently now. financial institutions that don't understand the
| value of trust, can't be trusted!
| tabtab wrote:
| It's not intended to replace a bank. For one, bank-related
| regulations that protect consumers are missing from PayPal. It's
| best used for buying random nick-nacks, and never keep more than
| a couple hundred in your PayPal account.
|
| Venmo etc. probably have similar risks.
|
| Use a credit card for more expensive stuff. If you are not able
| to get a credit card for some reason, I'm not sure what to
| recommend as an alternative. Suggestions?
| jonathantf2 wrote:
| One thing to take note is that money in PayPal isn't FSCS
| protected - because it's not technically a bank.
| donatj wrote:
| I get a ton of those fake invoices. I hope and suspect that isn't
| reason enough to ban an account.
| jake_morrison wrote:
| I went through a Kafkaesque experience with PayPal's Know Your
| Customer verification process. They screwed something up
| internally and decided that my company was in a different
| country.
|
| https://www.cogini.com/blog/paypal-know-your-customer-failur...
| ciguy wrote:
| Sounds like par for the course.
| ofchnofc wrote:
| I had to find the god damn CTO's email address to spam him a
| couple of times before my issue was fixed.
|
| I'm out of the country, I complete 4x $20 payments to a friend
| I'm visiting. I try to do the 5th and it wants to me to "Add a
| Mobile Number" to verify my identity.
|
| Brilliant PayPal. You already have my email+mobile on file. It
| says confirmed. I have 2FA enabled. And now, to verify my
| identity, you need me to enroll a " _new_ " phone number. How
| in the **, exactly, is that going to verify my identity. And
| how screwed up are your systems that your left brain and right
| brain are out of sync.
|
| Granted, I basically have to call them every 2 years for some
| similar sort of "your website just told me to go F myself, can
| you press the magic buttons to fix it since you can't, you
| know, actually fix your systems.".
|
| EDIT: The clencher to this story is calling PayPal and getting
| the sweetest older lady from Texas that, without asking me any
| further verification questions, pressed a button and said
| "okay, try again", and wouldn't tell me anything else. Only to
| hit the same issue ~24 hours later.
|
| I have a story like this for Schwab. I have a story like this
| for both my credit unions. Capitalism driven banking baby. What
| a joy.
| coolgoose wrote:
| Another year, another story (I could argue another week another
| story). Please keep in mind PayPal is NOT a bank, so use it as a
| transactional service, and that's it.
| annoyingnoob wrote:
| I got banned from Paypal because I used an expletive in a support
| email after they removed the requirement that I login before
| making a purchase (paypal would assume my login status based on
| cookies or browser fingerprints). I did not ask for that feature
| and I did not want it - I wanted to have to login each time I use
| Paypal, I had no desire to remove security features from my
| account.
|
| Well, I've been better off without Paypal, their ban did me a
| favor. Paypal will die in a fire of its own making.
| AlbertCory wrote:
| I already closed my PayPal because of this and other stuff.
| jiggywiggy wrote:
| I've heard these warnings about pretty much all payment
| providers, even stripe, Mollie but also banks.
|
| Not sure anyone you can fully trust.
| [deleted]
| supernova87a wrote:
| I was just commenting to a colleague about how ridiculous it is
| to still have a US payment/checking system that allows "pull"
| transactions from anyone with your account numbers, rather than a
| "push" system where you explicitly have to authorize sending
| money from your bank accounts. Like every other modern country
| you might think of.
|
| Our ACH system (plus the uncertainty of money clearing, holding
| periods, fraudulent checks / debits) creates such bad side
| effects for everyone, this PayPal situation included.
|
| I know there are some efforts to initiate a Fed-administered
| transfers system, but have no idea how it's going.
|
| We (with US government as a mediating authority) don't seem to be
| in control of having an effective banking system, and it's just
| getting more confusing over time.
| GTP wrote:
| To anyone who got problems with PayPal, you may be interested in
| reading this [1]. It is how an American attorney got his PayPal
| account back after it was locked for no reason, with all the
| steps explained. It was sent here on hn months ago.
|
| [1] https://jessesingal.substack.com/p/i-fought-the-paypal-
| and-i...
| SMAAART wrote:
| Most useful link of the year.
| munchler wrote:
| Summary: This person initiated arbitration per PayPal's user
| agreement (a simple process), and PayPal decided to reinstate
| his account before the hearing occurred.
| snapetom wrote:
| I wrote and posted on HN about my experience taking a home
| warranty company to arbitration a few months ago. My
| experience was the same as this lawyers and IANAL. The
| company settled immediately for almost all that I asked for
| and paid the arbitration cost.
|
| There are legitimate reasons companies pushed for arbitrtion.
| Namely streamlining and keeping away frivolous lawsuits, but
| there's the side bonus (for them) of scaring people away.
| Like that author described, companies make arbitration out to
| be this big, scary, unwinnable process, but it's really not
| like that at all.
| bityard wrote:
| Who chooses the arbitor? If the company chooses the
| arbitor, that's a clear conflict of interest. That's my
| issue with mandatory arbitration. After the fact that the
| arbitors' decision is legally binding in court.
| fl0ps wrote:
| Thankyou for writing about your experience. I hope I never
| have to consult it, but I'm glad it's there.
| oblio wrote:
| The thing is... what if you're not in the States?
| GTP wrote:
| I guess you would have to read their terms of service for
| your country. They probably still contain instructions
| about what to do, even if those could be different.
| ciguy wrote:
| Thanks for this. I won't be using PayPal ever again but
| hopefully it can help someone in need.
| [deleted]
| christkv wrote:
| If you are in Europe most countries let you bring them to small
| claims court if you have funds trapped in the account.
| VadimPR wrote:
| I run an open source project and we're channelling out finds into
| PayPal. What's a good alternative to switch to?
| moremetadata wrote:
| > must be more to the story when someones account was permanently
| banned
|
| UK banks do this as well, could be anything from having direct
| debits not sent despite plenty of funds in the account, so you
| lose things like domain names, websites, to being banned from
| accessing funds from your account and caught in a regulatory
| loophole with the banks refusing to talk to you. Their internet
| surveillance of customers is excellent!
|
| I've been locked out of my bank account for 6 weeks with the
| banks refusing to talk to me, Cahoot (Satander), GiffGaff are the
| latest to mess me around, basically they can
| d546dcddb8d207a80fe40e762023fbee !
|
| Because I remember what the employees of the state did to me as a
| kid. Scopolamine is used on infant age primary school kids right
| here in the UK.
| orangesite wrote:
| Thank you for the overdue reminder to finally get round to
| deleting my old paypal account!
|
| (Not that they make it easy, mind you)
| rqtwteye wrote:
| It's nuts that they can ban you without explanation. There should
| be a regulation that when somebody gets banned that they
|
| * are notified of the ban * there is an explanation * some
| process to appeal
|
| This will get even worse the bigger the tech players get. They
| can afford to throw a lot of people under the bus because they
| are only a small percentage of users.
| reify_this wrote:
| It is because of regulation that they are closing accounts
| without explanation. I used to run a debit card program with
| about 250K active accounts.
|
| The account closures are driven by the BSA/AML process (and
| briefly by operation chokepoint). By law, we are not allowed to
| tell the account holder the reason for the account closure -
| this is to prevent scammers (and the overwhelming majority of
| closures were of shady accounts) from learning the detection
| pattern and changing their behavior.
|
| So, don't blame the banks/card programs - blame the regulators.
| p0pcult wrote:
| Crazy! What's the relevant law?
| quickthrower2 wrote:
| This is whey crypto, for all it's awful flaws does have an
| advantage: no one can confiscate funds (by design _) or be
| allowed to draw down arbitrary amounts.
|
| _ Technical design. Obviously you can be coerced by force
| enahs-sf wrote:
| What about venmo? Same thing?
| irthomasthomas wrote:
| Don't use the PayPal mafia? Is it 2005? PayPalsucks.org has been
| online for 20 years. Yelling into the void. I do agree, though.
| https://web.archive.org/web/20040325150958/http://www.paypal...
| breck wrote:
| And people say crypto is a scam.
|
| The truth is trust no banks--I had Mercury Bank and First
| Republic help someone steal over $120,000 from me--I'm not
| kidding!
|
| Trust no one-distribute your money in lots of places so if one is
| crooked you are not dead.
| latchkey wrote:
| Spread out is key.
|
| Franchise Tax Board of California felt like I owed them taxes
| (which I didn't) and emptied one of my bank accounts without
| even giving any advance notice. Luckily it was a smaller one. A
| year later and I still haven't gotten my funds back, even after
| having my accountant spend hours on the phone with them and
| them promising to give it back.
|
| And you're right... people on this site time and again keep
| going after crypto as being a horrible scam... yet they keep on
| using Paypal. Well, if you hate crypto so much, what would be a
| better solution to the Paypal problem?
|
| Op posted this before:
| https://news.ycombinator.com/item?id=30269141
| breck wrote:
| > Franchise Tax Board of California felt like I owed them
| taxes (which I didn't) and emptied one of my bank accounts
| without even giving any advance notice. Luckily it was a
| smaller one. A year later and I still haven't gotten my funds
| back, even after having my accountant spend hours on the
| phone with them and them promising to give it back.
|
| Ugh, sorry to hear you are going through this.
|
| It's astonishing how incompetent (and/or corrupt) some
| organizations with power are.
|
| Anyway, more fuel for my fire to make things better.
| dragonwriter wrote:
| > And you're right... people on this site time and again keep
| going after crypto as being a horrible scam... yet they keep
| on using Paypal.
|
| I go on about (most) crypto(-related things) being a horrible
| scam (because it is) and also have avoided PayPal since very
| early in its existence, except in the very rare instances
| where a business for which there is no alternative requires
| it, which I've run into exactly once in the last decade (was
| a more common problem in the early 00s.)
|
| The world isn't a dichotomy between crypto and PayPal.
| latchkey wrote:
| > which I've run into exactly once in the last decade
|
| anecdotal evidence isn't really worth much, sorry.
|
| there is a reason why this story is trending on HN 5 months
| after the op originally got banned. it is because this
| keeps happening over and over again to untold numbers of
| people. the thread is full of endless amounts of similar
| complaints. you're here responding to the comments at the
| bottom of the page. you can choose to ignore all of that
| and make it personal to your experience, or you can listen
| to the warnings and try to find solutions that help others
| beyond just yourself.
|
| > The world isn't a dichotomy between crypto and PayPal.
|
| really, because you said so?
| marcosdumay wrote:
| If crypto worked, had a stable valuation, and low transaction
| tariffs, it would be a very valuable thing.
|
| But the people creating and maintaining crypto wants neither of
| the above, because they all detract from its value as a scam.
| breck wrote:
| > If crypto worked
|
| I have never had a problem sending someone crypto (I'll admit
| though, offramping can be a b*tch). I often lose hours of my
| life on hold with banks when they block a payment and/or
| freeze an account for a regular transaction.
|
| > low transaction tariffs
|
| If you avoid BTC and ETH and use something like XLM or NEAR
| you can get dirt cheap fees and fast settlement times.
|
| > stable valuation
|
| Yes I 100% agree with you there.
|
| > But the people creating and maintaining crypto
|
| I would agree with you and say perhaps between 30% and 90% of
| people creating and maintaining crypto only care about short
| term gains, but I'm an optimist and think the minority that
| believes in it will triump in the end.
| spzb wrote:
| People still keep money in their Paypal account? After all these
| years?
| blindriver wrote:
| There needs to be well-defined consumer rights when accounts get
| banned like this, from everyone of these companies. They
| shouldn't be allowed to arbitrarily ban without enough proof.
| They have gotten to the point where they are almost like
| utilities. Can we create a petition or a California Proposition
| to get this done?
| LegitShady wrote:
| Stop using paypal period. Just stop giving them money. You don't
| have to worry about trusting them if you never ever do business
| with them.
| aintgonnatakeit wrote:
| Is anyone working on a payment service with escrow, or does
| another good alternative to PayPal goods and services exist
| already?
| [deleted]
| ofchnofc wrote:
| > I always thought there must be more to the story when someones
| account was permanently banned. Well, it happened to me, one of
| the most plain and boring consumer users of PayPal ever.
|
| That self-exceptionalism? Yeah, most of everyone that hasn't
| already internalized not to use PayPal will do the same thing you
| did.
|
| It's futile. Let me guess, do you use a Password Manager (bonus,
| other than LastPass?)?
|
| Here's another futile one, you, yes, you, really need to make
| backups and replicate time-snapshots off-site.
| mtrower wrote:
| > Here's another futile one, you, yes, you, really need to make
| backups and replicate time-snapshots off-site.
|
| Yeah, but... you know... I'm like, busy and stuff. And
| realistically it'll never happen to me anyway.
| paulpauper wrote:
| People have been warning against keeping too much funds in PayPal
| since 2004. Consumer protection is nearly nonexistent.
| bjornsing wrote:
| > Consumer protection is nearly nonexistent.
|
| Surely you can take them to court (if you have time to burn)?
| ciguy wrote:
| I'm sure it's possible, but they probably count on having
| more money for lawyers than most of their customers.
| orthecreedence wrote:
| If it's less than the small claims maximum, it's absolutely
| worth taking them to court. They probably won't even show up
| and you'll get a default judgement in your favor. Usually the
| horror stories are tens of thousands of dollars (far past the
| small claims threshold) and believe me when I tell you that
| suing someone, especially someone with deep pockets, is a
| clusterfuck nightmare.
| JohnFen wrote:
| > suing someone, especially someone with deep pockets, is a
| clusterfuck nightmare.
|
| Absolutely correct.
|
| Even worse, winning the lawsuit does not mean you'll see
| the money. It only gives you the right to do things like
| attach liens onto their assets. You have to actually do all
| that footwork (and pay the associated expenses) yourself.
|
| So suing is a clusterfuck nightmare, and after winning,
| collecting what you're owed is a second clusterfuck
| nightmare.
| malfist wrote:
| I'm sure their EULA has an arbitration clause
| polski-g wrote:
| If they don't show up to defend their EULA in the small
| claims court it doesn't matter what they put in there.
| autoexec wrote:
| any money for lawyers and court fees.
| autoexec wrote:
| I remember reading paypalsucks.com around that time, closing
| our accounts and never looking back. It's sad that nothing has
| been fixed, a total failure of government, but if there was
| someone standing on the same street corner selling poisoned
| snake oil for 20 years with a pile of dead bodies all around
| them each clutching a bottle of the scammers poison, you'd
| think that at least after the first decade people in the
| neighborhood would learn to stay away.
|
| Examples of paypal being shitty abound. Why do people keep
| falling for it?
| idiotsecant wrote:
| This happened to me when I was using paypal income _to pay my
| rent_ while I was in school. They only locked up a few thousands
| dollars but that was life-or-death kind of money for me at the
| time. Taught me a very expensive lesson about never keeping money
| in paypal and never giving paypal your bank information. USe
| credit cards as your buffer between paypal and you. Paypal is
| like fire - you can harness it usefully, but it will burn you if
| given the chance.
| lowercased wrote:
| to the extent possible, it may make sense to just have multiple
| banks/accounts anyway. i use a big megacorp bank, my wife has
| money at a small local bank, we have other money in some online
| accounts. most stuff is handled day to day via one main
| account, but I've had cards suspended out of the blue in the
| past, and having 'all eggs in one basket' seems to be what
| often bites a lot of people when something causes a bank to
| freeze/suspend an account.
| wolongong942 wrote:
| > never giving paypal your bank information
|
| Why?
| toomuchtodo wrote:
| Because they can pull funds from your account and it'll be a
| hassle to get it back if not authorized. If you must, you tie
| it to a burner deposit account you can immediately sweep into
| our out of at your discretion. Sending funds? Sweep just
| enough in from another account. Receiving funds? Sweep out as
| soon as the funds land via ACH.
| marcosdumay wrote:
| Paypal can just pull money from an account without any kind
| of authorization on the US? That's a quite bad procedure.
| ldjb wrote:
| Have there been any examples of PayPal stealing money from
| people's bank accounts?
| buildbuildbuild wrote:
| This happened to me. An eBay buyer lied that the item I
| sold was never delivered. eBay sided in their favor, I
| was scammed by the buyer. My PayPal account went negative
| and bank account was debited of a few thousand dollars
| while a freshman in college. I hate PayPal.
| mtrower wrote:
| Meanwhile, I've had a package marked as delivered that
| never actually showed up. eBay wouldn't help me. USPS
| wouldn't help me without info from the seller. Seller
| never gave me the correct info that I requested, nor
| followed up with USPS.
|
| Seems random who gets screwed in these situations.
|
| Honestly it boggles my mind that USPS can just mark
| something delivered with no actual evidence of delivery
| (signature, photograph etc.) and it's just taken as fact.
| rootusrootus wrote:
| If you'd have played dirty and initiated a refund, then
| sent a box of nothing back, you'd have won in the end.
| All eBay cares about is delivery receipts. Not saying you
| should actually do that, but OTOH an experienced eBay
| seller knows how it will play out so if they could be
| convinced you were about to do it (without, you know,
| giving them evidence to send to eBay), it might light a
| fire under them to contact USPS and trace the delivery.
| ChickenNugger wrote:
| I literally just selected your question and searched
| brave: https://arstechnica.com/tech-
| policy/2022/01/paypal-stole-use...
| newaccount74 wrote:
| The article you linked talks about Paypal holding funds,
| not about Paypal taking money from bank accounts.
| bennysonething wrote:
| Happened to me in 2007, they took 750 GBP from my back
| account. I complained, it was never explained what
| happened. They paid the money back to me over a period of
| about 4 months. It was utterly ridiculous.
| pc86 wrote:
| There looks to be several in this thread alone.
| maxk42 wrote:
| Sort-of happened to me. Someone sent me a large amount of
| money unsolicited. (5 figures.) This wasn't a scam, just
| a very dumb woman who can't remember her teenage son's
| email address even though I've haf the address longer
| than he's been alive. I logged-in and canceled the
| erroneous transfer to return her funds to her, but
| unbeknownst to me a small automatic charge for a domain
| name had gone through since I received the money.
| Ordinarily I keep $0 in my Paypal account and Paypal
| automatically deducts the funds from my bank account. But
| apparently when reversing a transaction instead of
| covering any shortfall from my bank automatically, they
| charged me a $100 insufficient funds fee and THEN
| deducted the fee + shortfall from my account. Absolutely
| infuriating.
| mtrower wrote:
| That thing where recurring payments subtract from your
| PayPal balance before the assigned payment method is, as
| you put it, absolutely infuriating. It put me off of
| PayPal so hard.
| unxdfa wrote:
| Yes I temporarily lost PS350 via paypal and eBay. I sent
| some amateur radio equipment to someone via UPS tracked
| fully insured. Was signed and delivered. The buyer
| decided to return it immediately (suspicious) but I had
| no choice. I received the item back and it had a
| different serial number. The buyer had stolen a working
| radio and replaced it with a broken one. I contacted eBay
| and they told me to work it out with the buyer and they
| couldn't do anything. The buyer did not respond and
| opened a case against paypal. I provided evidence to
| paypal and paypal sided with the buyer because as far as
| they cared, both deliveries were signed for. Then because
| I didn't have any money in paypal they took it out of my
| account instead. The bank allowed this and it caused an
| unauthorised overdraft that cost me another PS30. I
| closed that bank account and removed it from paypal
| immediately.
|
| The buyer listed the radio I had sent him immediately on
| eBay for way above a reasonable price. I took screenshots
| and made a police report. Didn't hear anything back in a
| week. Considered small claims but I'd have to potentially
| travel to the claimant's area which is a good 3h drive
| each way at the time.
|
| So the buyer/reseller was in Ipswich which is 15 miles or
| so from my brother-in-law so he went round there and
| recovered it for me. My brother-in-law is an ex army
| (Gulf War vet) 6'5" bouncer. The guy did not argue with
| him. He was told he could come and collect the broken one
| at his cost from Bristol. He never did.
|
| I now run a mule account on ebay managed payments and do
| not accept paypal for anything and do not send anything
| until cash is cleared from the mule account into my main
| account.
|
| Edit: also worth pointing out that ebay do not allow
| sellers to leave negative feedback for buyers so you
| can't even rate or report the buyer publicly. If you
| leave any comments in a positive feedback other than
| sucking dick, they will remove the feedback.
| wolongong942 wrote:
| I vaguely recall this happening to a guy who scammed
| someone then got charge-backed after withdrawing from
| Paypal, he somehow got the bank to reverse his
| transaction to Paypal and kept the funds. I think this is
| why Paypal stop you from withdrawing/spending your
| incoming payment for a few weeks in some cases.
| meltedcapacitor wrote:
| In most of Europe there is an "undo" button in online
| banking next to such debits to get the money back no
| questions asked (for a few weeks after the transaction), as
| per regulations. US banking should copy this maybe.
| slugiscool99 wrote:
| This makes so much sense
| mattgreenrocks wrote:
| If I unlink my bank account, how can I get my money out of
| PayPal?
| unxdfa wrote:
| Spend it.
| thestepafter wrote:
| Create a second account with your bank that is only for
| PayPal withdrawals.
| neltnerb wrote:
| please no one say crypto ;-)
|
| but I definitely have the same question, I always deposit
| anything sent to me via paypal, venmo, whatever right away so
| there's zero balance.
|
| good luck telling a bank to un-authorize someone from being
| able to deposit or remove money from your account though, I
| had to call them up and they didn't even seem to know how to
| do it.
|
| somehow it isn't just a checkbox, it seems to me like
| revoking that permission should be vastly easier than
| providing it...
| jethro_tell wrote:
| link to a not main account and only setup one way transfers
| from one to the other i.e. You have your main account, and
| you have your paypal receivables account.
|
| Paypal receivables account has no overdraft protection and
| not overdraft allowance. If a withdrawl over the value of the
| account comes in, it is denied.
|
| Connect that account to paypal.
|
| Next, in the Paypal receivables account, setup an external
| transfer from the receivables account to the main account.
| You will have to validate the ownership of the second account
| usually by posting two small transactions that were auto
| posted to the account as part of the validation process. This
| takes a couple days. Once that is done, you can transfer
| money from receivables account to main account but not the
| other way.
|
| Transfer money out of paypal to the receivables account,
| transfer money from receivables to main. Use a credit card to
| spend money with paypal.
|
| You can set up two way transfers if you need to put cash into
| that account for transactions and you still get a similar
| level or separation, I just prefer to use a CC instead
| because they'll help you out if you want to dispute or
| reverse a transaction and paypal may not.
| shortcake27 wrote:
| > Paypal receivables account has no overdraft protection
| and not overdraft allowance. If a withdrawl over the value
| of the account comes in, it is denied.
|
| Note that this may not work everywhere in the world. For
| example, in Australia, the legacy direct debit system will
| happily put an account with no overdraft into negative
| balance.
|
| I'm not sure if the modern replacement (PayTo) has the same
| behaviour. In any case, legacy direct debits will probably
| stick around for years.
|
| The best option is to simply avoid PayPal.
| jethro_tell wrote:
| Maybe, but if you were going to pay your rent with the
| money on Thursday, at least it's not gone.
| Chilko wrote:
| Yep, have experienced similar surprise negative balances
| with Visa debit cards in New Zealand as well.
| winphone1974 wrote:
| This is a good approach in general, having a spending
| account where you pay anything directly, email transfers,
| cash withdrawals, etc., And then a true savings account for
| things like salary direct deposit. The Firewall between
| them is you making manual transfers. It's like CI/CD with a
| human approval step before going to GA
| mattgreenrocks wrote:
| Thanks!
|
| My bank (BoA) allows me to have multiple checking accounts
| so long as you satisfy the initial deposit requirement, and
| maintain sufficient balances in other linked accounts, so
| this looks like a good way forward. I think I'll switch
| other apps to use this new receivables account to contain
| their potential blast radius.
| lowercased wrote:
| double check your statements now and then - if you don't
| already. i had a biz acct and my home account, and would
| get dinged "service charges" on home account if it was
| below ... $500 for too long. Biz account had 30x that in
| there - far more than their min requirements, and I was
| told they were 'linked'. 2x in 3 years, they "got
| unlinked" and I was getting various $39 service fees on
| the home account. "Oh, so sorry, here... we linked again
| - we'll waive the fee"... months later... same thing.
| Less for you specifically OP and more just a general
| warning.
| arecurrence wrote:
| Paypal stranded me in Atlanta when I rented a room for a week
| and they denied the charge. So I called their customer service
| and got the worst customer service experience of my life. The
| rep would talk over me, literally speak gibberish, and then
| hung up.
|
| That was the end of my interactions with PayPal.
| rhino369 wrote:
| I couldn't even get them to speak to them. Their system
| denied my payment dispute (for which I could show obvious
| fraud) instantly--within 20 seconds. And then when I called
| they refused to talk since it was denied.
|
| Luckily I paid through my credit card on Paypal since I
| disputed it through them. If I had linked my checking
| account, they would have help a fraudster steal 700 dollars
| from me.
| fwungy wrote:
| Interesting thing happened to me a couple of years ago.
|
| I went to another state to pick up a car I had bought. I needed
| to pull $10k of my own money in cash out of the my banks to pay
| the seller. I checked with the banks before I left to make sure
| it would be OK.
|
| I arrived in Utah to meet the seller and we go to the bank to
| do the transaction, and my banks suddenly don't want to let me
| cash out that much money. I ended up having to kludge the
| transaction together with some my cash and credit card
| advances. I didn't quite make the full sale amount so the
| seller let me take the car and sent me the pink slip later.
|
| Second fact: online banking used to do instant bill pays. Now
| anything above a trivial amount has to be scheduled. It didn't
| used to be that way.
|
| Combining these two suggests to me there is a liquidity
| shortage in the retail banking system. Paypal may be under the
| same liquidity pressures and using fuzzy TOS reasons to hold
| money because they don't have the liquidity to handle all of
| their transaction demand.
| csours wrote:
| It's not liquidity, it's fraud protection
| winphone1974 wrote:
| Liquidity to support your 10k transaction seems unlikely.
| More likely fraud and CYA by the banks
| fwungy wrote:
| The bank workers told me they don't keep a lot of cash on
| hand to minimize robberies.
|
| The thing I wonder about is why did online banking start
| requiring scheduled payments for anything over a $100 or so
| about five years ago? Now they often make me wait a few
| days to clear a payment, unless it's internal to the bank
| itself (e.g. my checking account to pay off my same bank cc
| account).
|
| I'm sure they're investing my money short term and the
| holds give them more time and flexibility to do so.
| However, tying up account money in short term invesments
| means their liquidity will be reduced.
|
| If you were PayPal would you not invest user funds
| overnight (or longer) based on projections of
| inflow/outflow? If not you'd be cheating your shareholders.
| However the temptation to hold on to user funds as long as
| possible would be constantly present. That's almost
| certainly what's happening.
| etrautmann wrote:
| Great and succinct analogy, that was helpful
| bombcar wrote:
| If you have to give PayPal banking information make sure it's a
| separate bank from your "main" one - it should be easy enough
| to get a free online bank account you can use as an
| intermediary.
| abc_lisper wrote:
| Thank you for this. I just removed my main bank account with
| them.
| quickthrower2 wrote:
| Can US bank accounts get overdrawn? If they can the
| intermediary doesn't help it just gives you debt and bank
| charges.
| prirun wrote:
| Yes, and banks routinely charge $35 for _each transaction_
| on an overdrawn account. This is particularly easy to do if
| multiple people share a bank account with a low balance.
| AlexandrB wrote:
| They also sometimes sequence transactions largest to
| smallest when settling to maximize the number of
| charges[1].
|
| [1] https://www.forbes.com/sites/halahtouryalai/2013/06/1
| 1/yes-b...
| larsrc wrote:
| Oh, boy, can they ever! And the fees can be hefty. Even
| with a credit union back in the early 2000s, we were
| talking $10 _per day_, I don't expect it has gotten any
| cheaper.
| bigape911 wrote:
| didnt know companies can just take money from your account.
| broken bankings system
| pc86 wrote:
| The only two things you need to take money out of an
| account are the routing number and account number.
|
| There are a lot of checks on top of that which individual
| banks may or may not implement or care about, but at the
| end of the day those two numbers get you 99% of the way
| there. And for an organization the size of PayPal they're
| really going to be given the benefit of the doubt by banks.
| chongli wrote:
| So why aren't criminals doing this to drain accounts all
| the time? They traffic in stolen credit cards, why not
| banking info?
| bityard wrote:
| They certainly try. But it's not like there are no
| protections in place.
|
| The US banking system can be summarized as "withdraw
| first, ask questions later." The whole system is based
| around auditing after the fact. If at the end of the day
| (or week, or month), the numbers don't balance out, a
| flag is raised, and someone investigates it. And in many
| cases, there is a waiting period before you can access
| funds transferred.
|
| Outside the US, people find this whole thing crazy, but
| that's how it is and it actually works well enough. My
| understanding is that banks are moving to a more modern
| system, but it's a slow process given how much is built
| around the current system.
| twelve40 wrote:
| they do 100%. back in June i got charged $30,000 by a
| fake "home depot". I disputed the charge, but that wasn't
| fun. the cs reps told me it was not through a debit card
| but via acct+routing number which got leaked somehow.
| schoen wrote:
| I think that was why Donald Knuth stopped issuing checks
| for rewards for people finding errors in his books --
| people would post images of the checks online to brag
| about having received them, and then criminals would
| initiate fraudulent ACH transfers.
|
| Also not sure why that's not more common in comparison to
| credit card fraud.
|
| Edit: I guess credit card fraud can be easier to cash out
| (for physical goods or services), while ACH fraud
| requires mules to act as intermediaries to receive the
| fraudulent deposits, which might be harder to come by and
| sustain.
| addled wrote:
| I'm sure they do, but it might be less common because it
| takes more effort to launder than credit cards.
|
| There's millions of retailers that accept credit info in
| exchange for goods and services.
|
| You can't use ACH to buy Wal-Mart gift cards.
| Psychlist wrote:
| In Australia they technically need a direct debit
| authority, but PayPal is above the law in Australia so
| our dispute process is through our local bank. It works,
| but it's very tedious and the bank _will_ try to push you
| towards the PayPal dispute process. It 's much better not
| to link it to a bank account at all, use a credit card
| because that way it's two US corps fighting with each
| other when there's a problem.
| dotancohen wrote:
| What free online banks would you trust more than (rightfully
| untrustworthy) Paypal? Adding a free online bank account
| sounds like a way to add more points of failure.
| ptero wrote:
| The main argument for another small bank account to
| interface with PayPals of this world is not that it cannot
| fail, but if it does it is an easily survivable event.
| jszymborski wrote:
| I knew not to rely on PayPal to not lock my account but I
| never really thought about them withdrawing incorrect sums
| from my bank account.
|
| Will be removing my bank account from it right now.
| shortcake27 wrote:
| Another reason to remove your bank details is one-time
| login codes. PayPal is testing a feature that lets users
| log in using a 6-digit code sent over SMS, bypassing both
| password and TOTP/hardware authenticator, and the feature
| can't be disabled.
|
| I refuse to use SMS as a second factor, so using it as the
| _only_ factor for what is effectively a bank account is
| absolutely batshit insane. They've completely lost their
| mind.
|
| https://www.paypal-community.com/t5/Managing-Account/How-
| do-...
| bbarnett wrote:
| Like google, they _badly_ want your mobile number, for
| tracking and additional Pii /identity purposes. This is
| what it boils down to, not security.
|
| I cannot log in without a phone any more to paypal. At
| all. My mobile phone doesn't even work on my property, I
| live in a rural area, with no cell phone service for 1km.
|
| I have a phone. Email. I could set up 2fa via the
| internet.
|
| Nope.
|
| Because of _course_ , cell phones are always reachable?!
| AlexandrB wrote:
| > Because of course, cell phones are always reachable?!
|
| I don't get what you're supposed to do when travelling?
| Incur international texting charges?
| nicolaslem wrote:
| Receiving SMS via the Internet is possible by enabling
| WiFi Calling. It is a game changer for locations with
| good wired Internet but poor cell coverage.
|
| Of course it doesn't change the fact that using SMS for
| security should be illegal.
| Psychlist wrote:
| I have an old-ish paypal account with no phone number
| attached and while they prompt me every time I have not
| supplied one. There was a period of a month or two a
| couple of years ago when I couldn't use paypal at all
| without providing a phone, but I was quite willing to
| live without paypal. Mysteriously when I tried to log in
| a few months later it let me.
| kube-system wrote:
| > I cannot log in without a phone any more to paypal.
|
| I use TOTP with my account just fine?
| Kwpolska wrote:
| I suppose they might have an old account that does not
| have a phone number attached to it and PayPal won't let
| them log in without providing one?
| hairui wrote:
| hadn't considered this, thanks
| blamazon wrote:
| I'm not sure how folks regard privacy.com (the domain is a
| little... lofty?) but I use that to present my bank to PayPal
| as if it was a credit card. I change charge limits on the fly
| to be just a bit more than I need.
| 1f60c wrote:
| Revolut offers free (disposable) virtual debit cards and
| isn't limited to just the US.
|
| (No affiliation; I'm just a happy customer.)
| account-5 wrote:
| Revolut seems less trustworthy that PayPal. And there
| appears to be a lot less protection for you as their
| customer.
| sofixa wrote:
| > Revolut seems less trustworthy that PayPal
|
| Why?
|
| > And there appears to be a lot less protection for you
| as their customer.
|
| They have EU banking licenses (depending on where you are
| a different one applies to you), but they are a regular
| bank with all the protections that includes for a
| customer - if they go bankrupt, your money is guaranteed
| up to a certain extent; they can't just close your
| account and keep the money like PayPal do, etc. etc..
| shp0ngle wrote:
| Isn't Revolut just for Europeans?
| input_sh wrote:
| Not exclusively European countries, but also not the
| whole Europe: https://www.revolut.com/change-country/
|
| I was able to get my hands on one of their cards, but it
| was useless to me as I couldn't actually put any money on
| it from my unsupported country.
| [deleted]
| momirlan wrote:
| they closed their Canadian operations a couple of years
| ago. good riddance.
| fauigerzigerk wrote:
| Wise offers free virtual cards as well.
| soiler wrote:
| I've been using their app for years, it's pretty helpful. I
| really wish they used a different name, though.
| xkcd-sucks wrote:
| I got halfway through the "Privacy.com" sign up process and
| discovered they wanted my online banking username and
| password to access funds, with some ridiculous alternative
| like mailing a paper check
| unxdfa wrote:
| This. They can and will steal money out of your account if
| your cards don't work.
| unxdfa wrote:
| Actually you don't want to use credit cards between yourself
| and PayPal. They play a finger pointing game that can last
| months. Been there. I eventually had to small claims the CC
| company (MBNA Europe, now LLoyds) which took weeks. They didn't
| contest the claim or even turn up and judgement was made in
| favour in their absence then they did nothing until bailiffs
| were appointed then wrote the whole account off and closed it.
| Had numerous run ins with paypal unfortunately as a seller and
| a buyer.
| opportune wrote:
| Maybe I am just too young to understand PayPal's history and
| place in the payments world, but it seems like it's really a
| nightmare payment platform with only one major benefit: it's very
| friendly to issuing chargebacks to purchasers.
|
| With that in mind, it doesn't even make sense to me why payment
| receivers accept it, because there would be huge adverse
| selection in who uses PayPal - if the only value add is that it
| makes it really easy to chargeback, your customers using it are
| probably much more likely to chargeback.
|
| Of course chargebacks can be justified, but they can also be used
| to steal things. In the old school internet where everybody was
| afraid of handing over credit card details it might have made
| sense to use PayPal - maybe it still does in countries with low
| CC adoption - but it doesn't seem to be generally useful outside
| of that context, except for chargebacks.
|
| And then on top of the chargebacks you get all the jank inherent
| in a really old legacy product working in a regulated space, that
| is also integrated with tons of other payment platforms owned by
| the same company, which likely share a lot of policies/code in a
| way that creates tons of bugs and edge cases.
| mynameishere wrote:
| You could sign up for an account, put a button on your website,
| and get payments presto. I think this was pretty innovative 20+
| years ago. I suspect a Visa merchant account gave more grief
| then for someone making 100/month selling knickknacks.
| arthurcolle wrote:
| I know PayPal spun out of Ebay a long time ago and that PayPal is
| _especially_ evil and sociopathically unscrupulous but...
|
| EBay just banned my account last week for listing a Macbook Pro
| with stock image, removing it to adjust the title, relisting it
| with a photo of the "About this Mac" to show that the specs were
| correct. (Can't think of anything else that would even be
| remotely related).
|
| Also, the messages component of the Ebay web app was completely
| down the whole time so it made it impossible to respond to any
| users that were asking questions about the MacBook Pro.
| Completely insane. Apparently making listings is "harmful to the
| [Ebay] community"
| FireBeyond wrote:
| Meanwhile, my stolen phone was for sale on a prolific local
| seller's account (IMEI was listed, but two digits transposed -
| looks like a genuine error, but also stifles searching, fails
| checksum. Every other phone for sale by same seller has the
| same thing).
|
| 100+ phones. Mostly "activation locked", all "no charger, no
| accessories".
|
| 50+ laptops, all "no charger, no accessories".
|
| All blatantly stolen goods.
| albert_e wrote:
| Can you buy your own phone and chargeback after you receive
| and confirm it is indeed yours (jave original paperwork to
| show)? Get law enforcement involved if they fight?
| arthurcolle wrote:
| That is insane! How did you even manage to find them with
| digits transposed? By local seller, you must mean actually
| local to you? Sorry you got your stuff stolen, I once had a
| Giant e-bike stolen in Jersey City, so I know how much it
| sucks. I firmly believe everything should have some kind of
| tracker if it is more than $2K in cost.
| ChrisMarshallNY wrote:
| Pretty much everything you get from Apple is trackable.
| That's both good and bad; depending on who you ask, but
| they know where every device is, as soon as it's turned on.
|
| That's why I wonder at folks stealing iPhones and iPads.
| They are basically unsellable.
| justinclift wrote:
| This is from mid-2021, so not sure it's reliable (any
| more):
|
| https://9to5mac.com/2021/07/07/brazilian-criminals-
| detail-ho...
|
| Still... :(
| ciguy wrote:
| It's just algorithms out of control all the way down. They are
| probably ok with some number of false positives, but they don't
| account for how much these situations erode customer trust
| across the board.
| arthurcolle wrote:
| But also, this just happened to me:
| https://news.ycombinator.com/item?id=34840250
|
| and thankfully backed up all my critical data, but still have
| not been able to get a hold of anyone at Amazon.
|
| It seems like our ability to interact with a corporate entity
| has become an afterthought + that all the machinery driving
| customer interactions (UIs, special support chat hidden, dark
| patterns everywhere...) have become a total impediment to
| actually getting something fixed.
| bink wrote:
| ebay banned my account recently because I decided to list a
| vehicle for sale and noticed my address was old (I moved 3
| years ago). I updated the address at the time I listed the
| vehicle and they auto-banned my account. The only way to log
| back in was to use SMS to verify a landline number I had
| associated with the account 20 years ago. Their support was no
| help and just kept asking me to verify my phone number. Oh
| well, the fees were too high anyways.
| ChickenNugger wrote:
| > _I know PayPal spun out of Ebay a long time ago and that
| PayPal is especially evil and sociopathically unscrupulous
| but..._
|
| I thought it was that PayPal was built, then bought by eBay so
| the could double dip.
| lapcat wrote:
| See also from today: "I created an eBay account and bought an
| item, today I got indefinitely suspended"
| https://news.ycombinator.com/item?id=34912314
| leonewton253 wrote:
| I recently just closed my Paypal. You have to close your paypal
| credit accounts before they let you close it. They only approved
| me for $300, while AMEX approved me for $6000 last year, so not a
| big loss. They asked why and I said its a garbage service. I
| tried using it and it could not verify my identity, even though I
| uploaded a passport picture. I would suggest Stripe or even
| Coinbase commerce. At least no one can chargeback your
| stablecoin!
| AnAnonymousDude wrote:
| Stripe will do the same crap. Don't trust them, either. A few
| years ago they locked my business account with around $20k in
| it. On Christmas Eve. An account that had been in service for 5
| years and had processed a few million in charges with not a
| single chargeback. With almost 0 information on what I needed
| to do to restore the service. And without providing any way to
| get in touch with anyone aside from support tickets, which took
| 20+ hours between replies.
|
| A good reminder for me that I still need to move off of their
| platform.
| amelius wrote:
| Who you gonna call? Ombudsman!
|
| https://en.wikipedia.org/wiki/Ombudsman
| mortigi wrote:
| I can't think of a business I've worked for where PayPal hasn't
| done something like this in some way. Best thing I can recommend
| is complain to your state regulatory agencies. Even a one week
| suspension can be a major headache and revenue hit. It's
| incredible to me that they haven't been hit with more scrutiny
| given US banking regulations.
| napsterbr wrote:
| Yet another post from 23 days ago:
| https://news.ycombinator.com/item?id=34597862
|
| I'll repeat the advice I gave there: run away from PayPal as soon
| as possible. It's not worth the risk.
| cryptoegorophy wrote:
| I have the opposite experience with PayPal as a seller. Never
| had any issues with blockage. I did have some issues with
| customers trying to scam and sellers have a dedicated email
| support with a real person at PayPal that actually helps. Same
| with eBay. You must get to the right person that actually
| cares. I run a small company 20-30 people and the amount of
| times that I have to correct my employee responses to customers
| emails is insane no matter how much I train. It is a principal
| agent problem. No one cares about your business more than you
| do and with PayPal serving MILLIONS of people it reinforces
| support to care less rather going above and beyond to help. Oh
| and with scammers I learned by selling online that everyone is
| a scammer until proven innocent. People that you would've never
| think of being a scammer turn out to be scammers.
| robryan wrote:
| Obviously PayPal works for lots of businesses. Will just say
| though that any support/ account manager contacts you have in
| PayPal become useless when a walled off trust and safety team
| permanently suspend your account.
| tinus_hn wrote:
| Everyone has no problems with PayPal, everything is running
| smoothly just until they get banned and can't access their
| funds and they get to deal with the support bots.
| sacrosancty wrote:
| Except the horror stories are appearing with Stripe now.
| Really, the only safe way to transfer money is with traditional
| banks. But they have higher transaction fees and are slow, so
| maybe an occasional loss to Paypal is actually better than
| accumulated wire transfer fees in the long term.
| telchior wrote:
| Paypal vs wire fees is often the choice, unfortunately. I
| earn residuals from a company that only allows those two
| options. But when the money lands in Paypal, I immediately
| transfer it out, and I've considered going with wires just
| out of pure paranoia. Amazing that Paypal chugs along even
| with its hideous reputation.
| HoppyHaus wrote:
| I can only hope that FedNow works as promised and maybe, just
| maybe, we may have something a bit better than our current
| situation
| unxdfa wrote:
| If your money isn't in either cash in your hand or in a fully
| regulated bank somewhere then you're probably fucked.
|
| When doing business I expect to be paid by direct bank to bank
| transfer, regardless of how small the amount is. Even between
| friends, we send bank transfers. No cheques, no 3rd parties, no
| escrow.
| bbarn wrote:
| This problem will only go away with regulation. Sadly the minds
| in our industry are so focused on "disrupting the system" that
| little progress has been made. In the US, Venmo, paypal, etc. are
| still a thing and in most of the world - they simply aren't.
| Government regulated banking and an interchange standard is the
| way to go here. In Iceland where I previously lived, anyone could
| transfer reasonable amounts of money to any other person for
| free, through a government run banking system, regardless of what
| bank you had. I am normally against government intervention, but
| this is a case where a single standard and rule actually makes
| sense. The only people it doesn't make sense to are those trying
| to circumvent fees which should only be applied to business
| transactions. The argument against it is the cost to transfer
| money internationally, but.. those same benefits are the problem
| with systems like this - no regulation
| hackernewds wrote:
| The west should follow how revolutionary India's UPI system is.
| Even illiterate vegetable sellers use it in the villages - it's
| fast, reliable, cross-banking and does KYC stunningly well.
| MadSudaca wrote:
| I'm gonna be that guy: cryptocurrency fixes this.
| kube-system wrote:
| Does it?
|
| https://en.wikipedia.org/wiki/Mt._Gox
| computing wrote:
| I'm not batting for either team here, but you just linked one
| of the PayPals of crypto - ie a company that holds onto your
| funds on your behalf. So it's not really a rebuttal to their
| comment.
| kube-system wrote:
| I did so intentionally. The fact that crypto has still
| 'PayPals' is exactly my point. Whatever mechanism of value
| exchange you come up with, there will be intermediaries who
| pop up to move it around in different ways. Crypto does not
| 'solve' this.
| exolymph wrote:
| You don't have to custody on exchanges.
| kube-system wrote:
| You don't have to put money in a bank.
| ronsor wrote:
| You do if you want to send it online.
| kube-system wrote:
| And I need to use an exchange if I want my paycheck to
| become crypto.
| 41amxn41 wrote:
| Yea keep the funds in a wallet, not in a fucking exchange.
| That's the entire point.
|
| Not your keys, not your coins.
| kube-system wrote:
| "Don't use an exchange, crypto solves this!"
|
| "Don't use paypal, cash solves this!"
|
| Both systems have the same problem, in that people need to
| use intermediaries to accomplish the transactions they want
| to accomplish. Crypto solves nothing, it converts problems
| into different problems.
| JohnFen wrote:
| It might prevent you from being banned without reason, but it
| also eliminates the ability to claw back scammed money.
| latchkey wrote:
| Zelle is in the US, backed by major banks, and good luck with
| a claw back.
|
| "But Zelle's terms are clear: You can't cancel a payment once
| it's been sent if the recipient is already enrolled with
| Zelle. And if you send money to someone you don't know for a
| product or service, you may not get your money back for a
| product or service that's not delivered."
|
| https://www.elliott.org/problem-solved/how-to-get-your-
| money...
| JohnFen wrote:
| And I wouldn't touch that with a ten foot pole, either.
| kube-system wrote:
| That page explains exactly how to do so, via legal
| protections.
|
| The difference with crypto is that you're not going to be
| filing a Regulation E dispute against someone on the other
| side of the planet.
| latchkey wrote:
| >That page explains exactly how to do so, via legal
| protections.
|
| "Since Regulation E is virtually unknown outside of the
| financial services industry, few people -- let alone
| customers -- know the process of filing a claim."
|
| Oh come on. Zelle and the banks are literally banking on
| the fact that they are protected by exactly these sorts
| of unknown processes. Are you really advocating for more
| of that?
|
| > The difference with crypto
|
| The difference with crypto is that contracts, written in
| code, can be used to do escrow that don't require a third
| party centralized company like Zelle to handle the
| transfers. They also work across borders. No need to tie
| up the US legal system with 'Regulation E' cases over
| $1700 rent payments or having to hire lawyers to sue
| banks.
|
| My point is that, we can work to make this stuff better,
| or we can keep the status quo of having to learn about
| 'regulation e'. I'm on the side of working to make this
| better.
| JohnFen wrote:
| > contracts, written in code
|
| I wish those were called something else. They aren't
| actually contracts in the sense most people understand
| the term. And, being code (and immutable, if I understand
| it), I don't find their existence reassuring from a
| safety point of view. But that's neither here nor there.
| kube-system wrote:
| The article in the OP is a great example of why removing
| humans and relying on code is fraught with issues. The
| problem is that money is often used to exchange for value
| and things _outside of a computer_ , where smart
| contracts have little to no reliable mechanism for
| determining fulfillment of contract conditions. Although,
| I'm sure smart contracts will be of great use for moving
| around digital goods.
| latchkey wrote:
| The code can still involve humans, if that is the escrow
| system you'd like to use. It just doesn't have to involve
| a centralized entity. For example, I can imagine an
| escrow system where you can have third party arbitration,
| by anyone who wants to participate in the system.
| Incentivized by the two parties involved.
|
| People say that crypto is just re-inventing what already
| exists and a lot of it is doing that... I'm ok with that.
| What exists is not always the best solution.
| kube-system wrote:
| I agree that is the ultimate solution. But crypto is not
| necessary to facilitate such an arrangement. As soon as a
| human can override the outcome, you've negated the point
| of using mathematical proofs. Because now you're trusting
| in the human rather than the proof. You can't have it
| both ways. Either the ultimate authority is math, or it
| is a human.
| peyton wrote:
| You mean the PayPal buyer protection program? How does it
| work?
| JohnFen wrote:
| I mean using cryptocurrency to pay for things.
| peyton wrote:
| How does using crypto eliminate the ability to claw back
| scammed money? There are services that use crypto as
| payment rails and also offer scam protection.
| JohnFen wrote:
| What mr_mitm says. Also, once you're using services like
| that, what's the point of using cryptocurrency at all?
| What is it buying you?
| mr_mitm wrote:
| Then we're back to being at risk of being banned for no
| reason, though. Can't have it both ways.
| valcron1000 wrote:
| > but it also eliminates the ability to claw back scammed
| money
|
| I got scammed 500 USD using Wise, so it's not like these
| services help you in any way.
| JohnFen wrote:
| I don't understand the relevance, though. I'm not comparing
| cryptocurrency to other new services. I'm comparing it to
| the more traditional services.
|
| That said, with things like Wise (which I'd never heard of
| until your comment), it pays to read the fine print and
| avoid the ones that don't offer any real protection for
| you.
| ipaddr wrote:
| Imagine paypal as a crypto exchange holding your keys. Same
| outcome. The issue is trust and paypal.
| latchkey wrote:
| That's why we have decentralized exchanges.
| [deleted]
| weberer wrote:
| Don't put your wallet in someone else's computer.
| colesantiago wrote:
| No it doesn't at all. It makes the problem even worse.
| Heston wrote:
| Cryptocurrency suffers from the same problems if not worse.
| There have been billions stolen in cryptocurrency due to no
| regulations and a lack of accountability. In many cases the one
| robbing the exchanges were the owners themselves...
| trident5000 wrote:
| Happened to me. I did absolutely nothing nefarious; I'm the most
| boring person you can imagine. It was clearly some internal
| logistics they screwed up. When I called them they said "they
| couldnt tell me the reason why" and that was that.
| more_corn wrote:
| Had my PayPal account frozen by a tech support person out of
| spite. 2 week delay. Killed my whole project. Never again.
| atum47 wrote:
| I have deleted my account with them based on previous shady stuff
| they were pulling. Had to create a new account in order to get
| paid from other websites (turbsquid, cgtrader, thingyverse...)
|
| Most of these websites only uses PayPal as a method of payment,
| kinda forcing the user to do the same.
| TjZkxkxeky wrote:
| Be the unreasonable minority. It takes 3% of a population to
| flip the script:
|
| https://medium.com/incerto/the-most-intolerant-wins-the-dict...
|
| Tell them you can't purchase with them because they don't offer
| alternative payment.
| MrBra wrote:
| Is it possible to setup PayPal to automatically forward received
| money to a bank account or a credit card, without allowing them
| any withdrawal rights on that bank account or credit card?
|
| Would it be safe to use it that way?
| AussieWog93 wrote:
| Bizarre. I was a pretty serious PayPal user back in the day
| (~150k/year through my eBay store) and every issue I ran into was
| fixed with a 15 minute call to support.
|
| This was 10 years ago, to be fair, but have you tried simply
| calling support and explaining what happened?
| zachlatta wrote:
| We just had this happen too
| https://news.ycombinator.com/item?id=34803684
| marcrosoft wrote:
| I can't believe people still use PayPal in 2023. They've been
| known to be terrible for like 15 years.
| motohagiography wrote:
| To close my account, I emptied my balance into a random purchase,
| and I still want to close my account, but because there are a few
| dollars in it, they won't close it without a bunch of additional
| PII and hoops. I don't care about the money, I really just want
| zero risk exposure to them in my life.
|
| Maybe I should just try to get banned instead?
| kuroguro wrote:
| > one of the most plain and boring consumer users of PayPal ever
|
| Yeah it seems kindof arbitrary. I've abused my account doing
| weird stuff for years and it's still fine.
| jamiepenney wrote:
| I will never use Paypal ever again. I created my account when I
| was still at university, around 2005 I think. They wanted a phone
| number for verification so I gave them my home phone number (if I
| remember correctly, they didn't support mobile numbers in my
| country at this point). Later, they added mobile number support
| so I added my mobile and moved on. 16 years later, I get a 2FA
| prompt on login and they will only accept my original home phone
| number as the phone to use. I haven't had that number for 13
| years at that point, there was no way to use it. I called them
| and asked if I could verify with _any_ of the other numbers on my
| account but they refused, and said the only thing I could do was
| close the account.
|
| Luckily the only subscription linked to it was my Nintendo Switch
| online account, and that was easy to fix. I didn't have any funds
| stored in the account luckily, but there's no way I'm risking
| anything else with them given the experience I had with customer
| support.
| muhammadusman wrote:
| I've learned from HN posts over the last 10 years that Paypal and
| Ebay are two of the worst places to do any kind of business, let
| alone hold any money there.
| astura wrote:
| >small purchases when buying something off Craigslist or Facebook
| marketplace
|
| Seems like this is might be the case of it? I'd imagine one of
| these people turned out to be scamming people they'd ban accounts
| that have transacted with them?
|
| > I don't use it for anything sketchy.
|
| Sending money to strangers seems sketchy to me. I certainly
| wouldn't do it. _shrug_
|
| Anyway, PayPal isn't "special" - you risk being banned from
| literally any financial institution for seemingly no reason. You
| can read a million stories about people being banned from credit
| cards and banks online.
| JohnFen wrote:
| I don't see where the OP said he was sending money to
| strangers.
|
| But even if he was, what's sketchy about it? I've purchased
| things from strangers and sent them money with PayPal before.
| Is that not legit?
| CodeWriter23 wrote:
| I canceled PayPal after 20 years the day they put out the TOS
| change to deduct $2500 from customer accounts for posting
| misinformation.
|
| They subsequently claimed it wasn't intended to be their policy.
| And then they said oh yeah it actually is our policy.
| jawns wrote:
| In these cases, has anyone had luck getting their money back via
| either arbitration or small-claims court?
|
| I am sure their user agreement gives them some leeway to hold the
| funds for some period of time, but I would be surprised if the
| law allows them to permanently keep the money, with no legal
| recourse.
| ciguy wrote:
| The email I got said my funds would be held for 180 days after
| which they may be released at PayPals discretion. I am guessing
| their discretion almost never releases the funds. Thankfully I
| had no funds in PayPal since I had always heard the warnings.
| elevation wrote:
| I'm developing an custom software service for an Australian
| customer; I'd like to charge them $1-5k/mo USD which I'd need to
| convert from their Australian currency. As the largest
| international money transmitter, Paypal is the obvious option,
| but I hesitate to do business with them because of years of posts
| like this.
|
| Any other recommendations for invoicing Australians for
| software/SaaS from the US?
| TomGullen wrote:
| Stripe, bank transfers or Wise.com should all be pretty good
| options.
| notpushkin wrote:
| Obviously Stripe: https://stripe.com
|
| Or Wise, which will just give you a (virtual) account in
| Australia: https://ale.sh/r/wise
| redox99 wrote:
| Probably a very unpopular opinion here in HN, but stablecoins
| (USDC, USDT) are among the best ways to send money
| internationally. It's so much better than SWIFT.
| TomGullen wrote:
| I'd like to see a total conversion rate once all fees are
| taken into account - I bet it's not actually that competitive
| when all is said and done.
|
| Also, you're exposing yourself to a non zero risk of whatever
| exchanges you're using at the time to process your
| transaction/withdrawal go bust.
| redox99 wrote:
| Coinbase is relatively trustworthy (publicly traded US
| company). I believe trading stablecoins has 0.001% fee, and
| ACH withdrawals and deposits are free[1].
|
| And on the crypto side, USDT transfers on Ethereum (the
| most expensive chain) are usually less than $5. Currently
| about $3.40[2]
|
| SWIFT is much more expensive and slower, feel free to check
| SWIFT numbers.
|
| [1] https://help.coinbase.com/en/exchange/trading-and-
| funding/ex...
|
| [2] https://etherscan.io/gastracker
| latchkey wrote:
| This happened to OP 5 months ago...
|
| https://news.ycombinator.com/item?id=32855559
| ciguy wrote:
| Correct. They provided no way to appeal, but I had escalated
| internally via a friend of a friend who worked there. I was
| waiting for their response, and just heard back that even
| someone working there was unable to get in touch with the team
| that could handle this (Or maybe there is no internal way to
| mitigate bad algorithm decisions).
| VBprogrammer wrote:
| Upvoted because I think it's a good find and does being into
| question the OPs motives. But there is enough evidence out
| there to suggest absolutely minimising PayPal's access to your
| funds regardless.
| latchkey wrote:
| It isn't just paypal though, it is literally every
| traditional banking institution out there. People get locked
| out of their accounts (or even better, funds withdrawn by the
| government), all the time. I've had it happen to me.
|
| This site also has a very very US focused attitude,
| especially around banking and finance. I wish comments from
| people from other countries with far deeper issues would
| speak up more so that people on this site would get a better
| understanding of what happens to them and why this is a
| bigger issue than just paypal.
| jjav wrote:
| > It isn't just paypal though, it is literally every
| traditional banking institution out there. People get
| locked out of their accounts (or even better, funds
| withdrawn by the government), all the time. I've had it
| happen to me.
|
| The fundamental difference with all these Internet-centric
| companies is they have no useful support channel, nobody
| that will talk to you, you're just arbitrarily blocked with
| no recourse, your money is stolen, end of story.
|
| Traditional banks have branches where you can at least go
| talk to people. For example in the last year I've been
| helping an elder relative manage their banking and that has
| led to the account being blocked a handful of times
| (somewhat sensibly, as I can see how some of it could've
| been perceived as unusual activity). But they have a branch
| with actual humans (no AI bots) so I go in and explain and
| provide paperwork and all is fixed. By now I'm on first-
| name basis with one of their support agents so I can just
| call them directly, they know and remember me and all the
| circumstances of the account and have the authority to fix
| things.
| latchkey wrote:
| Traditional banks don't make it easy to send money to a
| friend, pay for your electrician or purchase something
| online. They use services like Zelle to do this and it is
| a prime example of a case where you can't claw back
| funds.
| youssefabdelm wrote:
| How does it bring into question his motives? Did he say
| anything contradictory in this post? He did say it happened
| recently, but 5 months is still recent -- He may have simply
| been reminded of the pain of that experience recently
| joemi wrote:
| The more that someone posts about their single bad
| experience, the more bad experiences people will remember,
| since they likely won't remember if it's the same person
| posting about the same experience multiple times.
|
| Although admittedly, in this case it looks like their
| previous post was just a comment somewhere, not a full Tell
| HN post like this one. So I wouldn't get too bent out of
| shape over this case.
| ciguy wrote:
| I was trying to escalate via internal contacts and waiting to
| hear back is all. Once I heard back that even someone
| internal was unable to help I figured I'd just post a
| reminder for everyone here.
| momirlan wrote:
| really appreciated. we have to defend the fort every day .
| VBprogrammer wrote:
| Yeah, I didn't really doubt that you where genuine. It
| would have been less open to misinterpretation if you'd
| mentioned having posted previously or including details of
| the timeline in the original post is all.
| ciguy wrote:
| I didn't post about it...I commented on another relevant
| post around the time it happened. I don't think previous
| comments really require disclosure. It really seems like
| you are phishing for something here.
| joemi wrote:
| Most of the examples noted elsewhere in this thread
| (https://news.ycombinator.com/item?id=34914880) are examples
| of people getting scammed and temporarily not having access
| to the amount they were scammed out of. I'm not sure how
| anywhere else like paypal would be able to handle this kind
| of situation any differently.
| jmyeet wrote:
| The problem here is a lot bigger than PayPal.
|
| Consider people who sell through Amazon or even use Amazon for
| distribution. Amazon can arbitrarily decide you've violated their
| TOS, suspend your account and freeze any funds you're due for
| things you may have already shipped.
|
| You may be in limbo for months. It might be impossible to reach a
| human to resolve it if you're not of sufficient size.
|
| I get the need to combat fraud but what we have here is a
| financial incentive for companies to freeze and basically steal
| your money. Even if you eventually get it back just holding it
| has value.
|
| That's a problem.
| cenourinhapt wrote:
| My advice: Don't use Paypal ever again.
| ciguy wrote:
| Well it seems like I don't even have that option anymore.
| Thankfully I don't need them anyway it's just a minor
| inconvenience. But I wanted to warn others who may be put in a
| bad situation.
| jononomo wrote:
| So PayPal just randomly steals people's money? WTF??
| latchkey wrote:
| Not your keys, not your coins. The government can do this with
| your bank accounts too.
| thedanbob wrote:
| They grant themselves the right to steal your money (from your
| linked bank account, no less) in their TOS:
| https://news.ycombinator.com/item?id=33348913
| jononomo wrote:
| Thanks. I'm going to deactivate my PayPal account.
| jononomo wrote:
| "We've removed your card. We're still processing any
| pending payments on it."
|
| It sounds like they've removed my card from the UI, but
| they can still charge it if they want.
|
| In any case, I'm going to close my PayPal account and
| hopefully cancel that card within a few weeks.
| shortcake27 wrote:
| I don't understand why PayPal isn't regulated like a bank. You'd
| think after thousands of horror stories where PayPal literally
| steals people's money, someone would step in and enforce them to
| provide a minimum level of service when closing an account, ie a
| way to get your funds out.
| filmgirlcw wrote:
| It's the greatest scam. PayPal isn't a bank -- even though it
| looks like a bank and acts like a bank, but it crucially IS NOT
| a bank -- and thus, has none of the same protections of a bank.
|
| I can't remember the exact legal/technical wizardry they've
| used to get around this, but this has always been a crucial
| part of the PayPal business model. It's not a bank, it just
| makes people think that it is one.
|
| As others have said, don't keep any money in PayPal and if
| possible, try to attach a secondary bank account to your PayPal
| account to limit your exposure. I've had a PayPal account since
| I was a teenager and _knock on wood_ have never had any
| problems, but I always immediately transfer the money out of
| PayPal as soon as possible.
| justinclift wrote:
| Apparently in the EU PayPal is registered as a Luxembourg
| bank:
|
| https://en.wikipedia.org/wiki/PayPal#Offices
|
| But, I've heard several times they have most of the law firms
| in Luxembourg on retainer. So, it's extra difficult taking
| them to court (with representation), due to "conflict of
| interest" with this majority of Luxembourg law firms.
|
| There are many further examples of their EU legal approach
| here on HN, if that helps. eg:
|
| * https://news.ycombinator.com/item?id=32742258
|
| * (lots more from a quick search)
| libraryatnight wrote:
| When I was a teenager there was no reason not to transfer the
| money out immediately. It was understood it was a middleman
| that allowed us to accept payment online without a merchant
| account. So we treated that way. It felt like a hack. It
| still feels like a hack, but as you say they've taken on the
| look of a bank. Once they started offering cards you could
| use to debit from your account etc, people started leaving
| the money behind more and more.
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