Consumer complaint received 2017-11-08
Company: Paypal Holdings, Inc
State: CA
Product: Money transfer, virtual currency, or money service
Sub-product: Mobile or digital wallet
Issue: Managing, opening, or closing your mobile wallet account

Complaint:
Re : Case ID Number : XXXX On XX/XX/XXXX,  PayPal sent to me an email with subject " We noticed an issue with your account ''. They failed to state anywhere in this mail about what this issue specifically was and the body of the email was simply requesting, " Your registration as an organization with any applicable regulatory body governing your jurisdiction. " We were not aware that we as a business selling the items we do had any regulatory requirements because we do not conduct business in high risk products such as XXXX or firearms, etc. Perhaps we misunderstood the meaning of this. Additionally, we regularly receive phishing emails stating similar " PayPal '' warnings of account problems from companies falsely representing themselves as PayPal. Because of these things, we had not responded due to considering the email to not be legitimate. 
On XX/XX/XXXX, upon observing problems with our XXXX transactions ( primarily that we were not able to pay for shipping labels in XXXX shipping, which are deducted from PayPal ), we determined that PayPal had 'limited ' our account ( blocking any and all withdrawals ) which at the time had a balance of over $ 4k USD. We immediately contacted PayPal by phone that day in hopes of resolving whatever the issue was, got routed to their 'Limitations ' department, and had opportunity to speak to a person who identified himself as a 'manager ' of that department. This person reviewed our situation and the correspondence PayPal had sent. During the course of this call, we submitted copies of our business registration and resale certificate and so this manager reviewed the account to verify those had been received and he could read them legibly from that submission. It was his opinion that the email directive from PayPal was too ambiguous but as far as he was concerned, we had submitted all the necessary information. He advised us that limitations could take as long as 180 days to clear so we asked to get more information about the limitation and speak to someone.
However, he advised that although he was a manager of the 'limitations ' dept, it is actually the 'compliance '  department who triggers limitations and who releases limitations BUT there is no way to contact them by phone and I would only be able to email them via a specific 'compliance ' group email address ( which he provided to me ).
On that same day, XX/XX/XXXX, I sent an email to PayPal instructing them to tell me specifically what the issue was, what information they required, and to take action to release my funds promptly. 
Regarding the submission of requested records, on this PayPal website page where a user is to submit this resolution documentation, there were confusingly three categories of information with ability to submit different types of documentation to each ... only one category ( the one pertaining to business records ) seemingly applied to the email I had received, and the limitations dept manager I was speaking to at the time also viewed this page and agreed that as far as he could tell, that was the only one which applied to my case, while the other two categories  of information were unclear as to what PayPal was expecting, if anything, and likely did not apply to my case, nor were they mentioned in the email I had received from PayPal. 
After having submitting the records on the website and sending the email to the provided address on XX/XX/XXXX as mentioned, but having not received any response from PayPal for days, I sent another email to this 'compliance ' email address again summarizing the same demands for information and prompt release of my funds. 
4 days had passed and I still received no response from PayPal to my emails to this 'compliance ' department. By this point, my PayPal balance had increased to nearly $ 6K as XXXX sales continued to deposit to the PayPal account. In the meantime, I spent considerable time and resources in setting up alternative shipping solutions to meet customer orders and shipping demands, and also initiated the arrangements for credit card processing. These alternative solutions were put into place by XX/XX/XXXX by which time my PayPal balance was nearly $ 7k due to the continuing XXXX sales that continued to deposit into the 'limited ' PayPal account. Note that Paypal was more than happy to allow funds to continue to be deposited into my account from the XXXX sales but PayPal was unwilling to allow any expenditures or withdrawals from the account, including routine expenditures in support of those XXXX sales such as shipping postage payments, or refunds I might initiate to buyers, etc. So, PayPal had established their own set of rules whereby they construe some convenient reason to limit an account so as they can continue to increase their wealth but refuse reasonable access to the individual 's funds, knowing that doing so likely has material impact to a small business operation. 
By the XX/XX/XXXX, I had ceased accepting PayPal completely, having transitioned all incoming payments to credit/debit card solutions. On this day, having yet to receive any response in any manner from PayPal, I again sent another email to the 'compliance ' email address stating the same demands and expectations as the previous. On this day I also submitted to the other two categories a written message directing PayPal to tell me specifically what information they require because it was not clear. All three categories showed a check mark indicating information had been received and PayPal general status indicated that they would be conducting their review and would response as soon as they completed the review. 
By XX/XX/XXXX, we had yet to receive ANY email response, phone call, or contact whatsoever from anyone in PayPal. It was clear that hey were simply ignoring any and all attempts we made to contact them. So, on XX/XX/XXXX I sent yet another email stating the same demands and  expectations but this time, in addition to submitting it by email, I created a PDF of that email document and submitted it to each of the 3 resolution documentation categories again. Curiously, soon after doing this, Paypal then changed the appearance and the format of that specific resolution submission page, disabling any button for the user to submit any further documentation to those submission categories. However, this updated web page of theirs did have added information on what to expect regarding the limitation ( except that none of this information was clarification of information required ), most notably of which was that it stated they would respond to submissions within 2 days. 
This '2 days ' promise is laughable because it has been since XX/XX/XXXX when I first submitted documentation. Far more than 2 days have passed since each and every of my numerous subsequent emails and submissions to them. Today is XX/XX/XXXX and we have emailed them for a fifth time today. In light of not expecting from them any response to this fifth communication, we feel we have no choice but to begin formal complaints against the company. 
The overall complaint here is that XXXX is exercising willful misconduct in unilaterally freezing a customer 's account while providing terribly vague demands for information and absolutely NO explanation of why. Furthermore, they intentionally prevent any reasonable method for a customer to contact their only 'cognizant ' department by establishing all contact to be by email only but then refuse to respond to those emails. While demonstrating this negligence and misconduct, they have the audacity to continue receiving funds but to disallow any removal of funds, all the while knowing that this is a business account and to conduct themselves in this manner will likely have material financial consequences to their victims. 
This is in essence a type of theft they have instituted, and an arrogant, abusive practice of theirs. Even if this were to be condoned under the interpretation that their actions are only temporary ( if 180 days can be considered 'temporary ' ), their behavior in intentionally not communicating properly with the victim has earmarks of willful misconduct, negligence, and tort.

Company response to consumer: Closed with non-monetary relief