Consumer complaint received 2025-01-31 00:00:00
Product: Money transfer, virtual currency, or money service — Mobile or digital wallet
Issue: Trouble accessing funds in your mobile or digital wallet — 
Company: Paypal Holdings, Inc
State: MS

Complaint narrative:
I am submitting this formal complaint regarding PayPals unfair and deceptive business practices, specifically concerning its arbitrary account limitations, failure to provide clear reasoning, and illegal withholding of my funds totaling {$18000.00} USD for XXXX days. Despite providing all requested documents, service agreements, business plans, banking, letters of explanation, vendor contracts, answered questions on fulfillment times, cancellation policies, cancellation insurance, brochures, website, social, verified guest transactions, and repeated attempts to resolve this matter through XXXX customer service channels, I have received vague, automated responses and no meaningful explanation as to why my account was permanently limited. 
Background & XXXX  Unjust Actions I operate a legitimate small, family-owned business, XXXX XXXX XXXX XXXX an event venue in Mississippi, providing an event space for weddings and other special occasions. 
XXXX XXXX XXXX opened for business in XXXX of XXXX and began accepting payments via PayPal for guest bookings in XX/XX/XXXX. 
As our business grew, we expanded our advertising and marketing efforts, including partnering with platforms like XXXX ( XXXX  XXXX + XXXX ), which increased visibility and led to a natural rise in transaction activity. 
Recognizing the influx of payments as a sign of business growth, we proactively complied with XXXX verification requests, submitting weeks worth of documentation confirming transaction details, client agreements, and proof of service fulfillment. 
On the evening of XX/XX/XXXX, immediately after complying with instructions from a PayPal representative to have XXXX of our guests check their emails to approve their transactions with XXXX XXXX XXXX and after both approvals were complete, we received an email notification that our account was permanently closed and funds still withheld for 180 days. 
The customer service process has been opaque, lacking human oversight, as responses are largely automated rejections without an avenue for appeal or resolution. 
It is nearly impossible to reach a live representative. The process is frustratingly circularautomated responses direct me to the website, which then directs me back to automated responses, and a beta chat help bot that appears at random and offers nothing but automated selections and responses. 
PayPal automates misleading & contradictory documentation requests. I was required to submit proof of inventory, which is irrelevant to my business as I do not sell physical goods and am categorized under the business type for Hotel/Reservations. PayPal rejected the documentation I provided without an option to explain my business model. PayPal refuses to acknowledge the nature of my business and continues to demand irrelevant documents. 
XXXX XXXX XXXX. XXXX XXXX of Similar Complaints and continued enforcement of arbitrary limitations without due process suggests a pattern of systemic abuse rather than individual risk assessment. 
XXXX Violations & Grounds for Complaint XXXX. Unfair & Deceptive Trade Practices CFPB & XXXX XXXX Protection Laws a. XXXX failure to provide clear, non-automated explanations violates 12 U.S. Code 5531 ( Prohibiting Unfair, Deceptive, or Abusive Acts or Practices - UDAAP ). 
b. Mississippis Unfair and Deceptive Trade Practices Act ( XXXX ) prohibits businesses from engaging in deceptive, fraudulent, or unfair practices in commerce. PayPal 's vague responses, lack of transparency, and prolonged withholding of my funds without clear justification constitute unfair practices. 
XXXX. Violation of the Electronic Fund Transfer Act ( EFTA ) & Regulation E a. The EFTA ( 15 U.S.C. 1693 ) and Regulation E ( 12 CFR Part 1005 ) prohibit financial institutions from improperly restricting access to consumer funds. PayPal, acting as a financial service provider, has violated this by holding my money for XXXX  days without due process or recourse.

XXXX. Violation of Mississippi XXXX XXXX  XXXX XXXX XXXX XXXX XXXX Mississippi XXXX protects consumers from unjust withholding of funds by financial institutions. The Mississippi XXXX  XXXX XXXX  and XXXX XXXX ( XXXX ) has jurisdiction over businesses engaging in financial transactions within the state. XXXX prolonged hold on my funds without reasonable justification should be investigated. 
XXXX. Lack of Due Process & Discriminatory Practices a. PayPal has denied me any opportunity to appeal or provide further documentation relevant to my business model. The use of automated decision-making tools, instead of human review, raises concerns of arbitrary enforcement and potential discrimination against small business owners.

Company response to consumer: Closed with non-monetary relief