5 ms·
Financial industry is strictly regulated. Otherwise, imagine what would happen if banks could freeze your accounts freely, leaving you out without any means to
by kalininalex 14y ago
Financial industry is strictly regulated. Otherwise, imagine what would happen if banks could freeze your accounts freely, leaving you out without any means to pay for food or housing. Paypal could be that for larger merchants who could have substantial part of their assets tied up at Paypal.
What I find interesting is that Paypal is essentially a bank, yet it's completely unregulated.
- dangrossman 14y agoBut there is no regulation on banks that would affect this policy. Actual banks that offer merchant accounts do the exact same thing. They can and do freeze your merchant account freely, leaving you with no access to any undisbursed funds. I've been through this myself. I had a merchant account about 8 years ago, underwritten by First National Bank of Omaha (the largest private bank in the United States). I got a couple large, unexpected chargebacks all at once from a single scammer that used multiple stolen cards. FNBO decided to create a reserve on my account for several days while they reviewed my account, then decided to terminate it due to the chargebacks. They held several thousand dollars of my money for exactly 180 days before returning it to me. That's money I needed to pay vendors and pay my bills - and it was perfectly legal for this regulated bank to hold it.
- deleted 14y ago[deleted]
- deleted 14y ago[deleted]
- deleted 14y ago[deleted]
- deleted 14y ago[deleted]