4 ms·

I'm going to be somewhat direct here. I allege that what Paypal is doing here (holding funds over 10 days) is illegal. In order to do what Paypal does in the

I'm going to be somewhat direct here. I allege that what Paypal is doing here (holding funds over 10 days) is illegal. In order to do what Paypal does in the USA, you need licensure. They point out that they are not a bank. Indeed, they aren't: in many states they are classified as a money transmitter. In 8 states, they have no license to operate.#1 What is this money transmitter stuff? In essence, the law in all the locales I have checked (I have not gone through every one), indicate only a short holding period (5-15 days) and only allow holding of money of a known crime. So indeed what they do is absolutely fraudulent. In other words, if you have a patent troll corporation with many lawyers, target Paypal for their illegal behavior. #1 Source: https://www.paypal-media.com/state_licenses.cfm https://www.paypal-media.com/state_licenses.cfm

OstiaAntica 15y ago
This is a very anti-hacker post, and an argument for the broken status quo. I also seriously doubt it is accurate. PayPal has disintermediated anti-competitive banking laws, providing millions with low-cost quasi-banking. They should be celebrated, not attacked.
- TheAmazingIdiot 15y ago
  Theft of money from startups and non-for-profits is worse in my book. I use the direct word theft, because they take money that is out of the bounds of most money transmitter licenses. And considering what is taught in business school, is to quantify risk. If you trigger the unknown red flags, which software makers and other starting businesses tend to do, you risk losing access to your money for at least 180 days (up to forever). How do you quantify that kind of risk? California, re 1841: http://www.leginfo.ca.gov/cgi-bin/displaycode?section=fin&group=01001-02000&file=1840-1846 http://www.leginfo.ca.gov/cgi-bin/displaycode?section=fin&#3... And they are not even licensed to _operate_ in my state of Indiana. IC 28-8-4-20 (a) A person may not engage in the business of money transmission without a license required by this chapter. # hence all Paypal business in Indiana is illegal.

OstiaAntica 15y ago

This is a very anti-hacker post, and an argument for the broken status quo. I also seriously doubt it is accurate. PayPal has disintermediated anti-competitive banking laws, providing millions with low-cost quasi-banking. They should be celebrated, not attacked.

TheAmazingIdiot 15y ago
Theft of money from startups and non-for-profits is worse in my book. I use the direct word theft, because they take money that is out of the bounds of most money transmitter licenses. And considering what is taught in business school, is to quantify risk. If you trigger the unknown red flags, which software makers and other starting businesses tend to do, you risk losing access to your money for at least 180 days (up to forever). How do you quantify that kind of risk? California, re 1841: http://www.leginfo.ca.gov/cgi-bin/displaycode?section=fin&group=01001-02000&file=1840-1846 http://www.leginfo.ca.gov/cgi-bin/displaycode?section=fin&#3... And they are not even licensed to _operate_ in my state of Indiana. IC 28-8-4-20 (a) A person may not engage in the business of money transmission without a license required by this chapter. # hence all Paypal business in Indiana is illegal.