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PayPal performed a "freeze and seize" on our account ~12 months ago, netting just over 50k EUR. They then went on a war of attrition, enumerating across distinc
by kweks 4y ago
PayPal performed a "freeze and seize" on our account ~12 months ago, netting just over 50k EUR. They then went on a war of attrition, enumerating across distinct companies, shareholders seizing funds across all accounts (including accounts of unrelated companies and personal accounts in Hong Kong and Australia)
No information was given. After the 180 days "freeze" period, they announced that the funds would not be returned, ie: they stole the money.
We lawyered up. Their legal team refused to acknowledge official communications from our lawyers, citing "Customer Privacy Protection".
When we turned up the heat, we were told that our French lawyers (for a French company, and a French account) had no jurisdiction - the account was managed by PayPal Luxembourg.
We retained Luxembourg-based lawyers. PayPal Luxembourg refused to communicate with the lawyers, regurgitating "Customer Privacy Protection".
We lodged a complaint with the CSSF, the Luxembourg monetary watchdog.
PayPal finally replied via the CSSF, citing that our account was selling illegal products, ergo the proceeds were illegal, ergo PayPal deserved to keep them.
None of the products they cited were ever featured on our site. They included screenshots of other sites. When this was transmitted to the CSSF, PayPal silently released all funds owed, but continued to defend their position.
We are now pursuing damages; PayPal Luxembourg is now claiming that the CSSF has no jurisdiction over them, because the accounts are French / HK / Australia.
PayPal has an active policy of abuse and racketeering. They know the legal system. They use multiple jurisdictions in their T&Cs to maximise and legalise their theft (IE, PayPal Luxembourg cites UK law in the T&Cs to allow punitive damages for perceived breaches of their illegal contracts).
They know the legal system, and use their multi-national entities to avoid oversight from watchdogs. They know customers don't have the resources to pursue them. We've spent well over 100k to recover 50k, but someone has to stand up to these thugs.
If you're in a similar situation: Don't be intimidated. Get lawyers, and pursue them via the monetary authorities in your country. They have made theft a business model; apply pressure on the entities that can apply pressure on them, and you'll have a good chance to get your money back.
- TAForObvReasons 4y agoYou spent well over 100k and recovered 50k. If you were also compensated for your legal expenses in the process, then sure "don't be intimidated" is a calculated risk. If you didn't, then it seems like you are a loser either way and should just encourage customers not to pay with PayPal. Sharing the story with your customers and other developers does more damage to PayPal than fighting.
- rchaud 4y agoPlease consider writing a blog post online, so there's a permanent link to your story online somewhere. You have described a pretty elaborate system designed to dodge accountability when customers ask questions. You should consider talking to a business journalist as well. Here in Canada, the public broadcaster's website has a "Go Public" section where well-documented customer complaints are publicized. In most cases, the company pays up what it owes, but only after the story becomes public. https://www.cbc.ca/news/gopublic https://www.cbc.ca/news/gopublic
- ChainOfFools 4y agosounds like all a shady company has to do to get away with fraid, is to become its own customer and block every criticism with 'cant prove we did it, because privacy' the way crypto scammers do with 'cant prove we did it, because decentralized'
- suction 4y ago
- wdb 4y agoYeah, I have a similar story myself. They still have my money hostage. You are amazing going to reach out to CSSF tomorrow
- sdwr 4y agoThat's fucked up! I can't fathom the mindset required to scam people like that, let alone do it at an institutional scale. Good on you for taking a stand, that helps everyone in the long run. My default reaction to being scammed is to feel ashamed. A cashier took a $10 out my change as a kid, my dad finding out and going back and confronting the clerk was painful. With experience I've gotten more (maybe too much so!) alert to scams, confidence schemes and dark patterns. A lot of them operate at a level of plausible deniability, or even subconscious action, where the person profiting doesn't have to know what's going on. Last winter the game EFT had a winter marketing blitz, which they paired with authentication servers being down for old accounts ... as a returning player I had to buy a new account to participate.
- hulitu 4y agoPayPal had those kind of problems simce at least 15 years. Why are people still using it ?