PayPal faces lawsuit for freezing customer accounts and funds

[Yo_Mama_Been_Loggin]

Three PayPal users who've allegedly had their accounts frozen and funds taken by the company without explanation have filed a federal lawsuit against the online payment service. The plaintiffs — two users from California and one from Chicago — are accusing the company of unlawfully seizing their personal property and violating racketeering laws. They're now proposing a class-action lawsuit on behalf of all other users who've had their accounts frozen before and are seeking restitution, as well as punitive and exemplary damages.

Lena Evans, one of the plaintiffs who'd been a PayPal user for 22 years, said the website seized $26,984 from her account six months after it got frozen without ever telling her why. Evans had been using PayPal to buy and sell clothing on eBay, to exchange money for a poker league she owns and for a non-profit that helps women with various needs.

Fellow plaintiff Roni Shemtov said PayPal seized over $42,000 of her money and never got an acceptable reason for why her account was terminated. She received several different explanations when she contacted the company: One customer rep said it was because she used the same IP and computer as other Paypal users, while another said it was because she sold yoga clothing at 20 to 30 percent lower than retail. Yet another representative allegedly said it was because she used multiple accounts, which she denies.

Shbadan Akylbekov, the third plaintiff, said PayPal seized over $172,000 of his money without giving him any explanation why the account got limited in the first place. Akylbekov used the account of a company his wife owns to sell Hyaluron pens, which are needle-less pens that inject hyaluronic acid into the skin. After the money disappeared from the account following a six-month freeze, PayPal allegedly sent his wife a letter that says she "violated PayPal's User Agreement and Acceptable Use Policy (AUP) by accepting payments for the sale of injectable fillers not approved by the FDA." It also said that the money was taken from her account "for its liquidated damages arising from those AUP violations pursuant to the User Agreement."

https://finance.yahoo.com/news/paypal-lawsuit-freezing-customer-accounts-funds-073128563.html

[bamagal62]

1. I've never trusted PayPal.

I refuse to use it.

[jimfields33]

2. They can close the account, but not keep the money!

I hope PayPal loses big.

[RKP5637]

3. Incredible!!! n/t

[Vinca]

4. I've had a PayPal account for decades, but I'd never leave a large amount of money there.

I wouldn't deal with any other online banking outfit, either, unless it's connected to the local bank where I've also done business for decades. I want to be able to walk into an actual building and see an actual person if I have a problem. PayPal, for me, is more of an intermediary to pay for stuff without having to give my main bank account number out to everyone in order to create a debit for a purchase. In any case, PayPal has no right to close an account and then seize the cash.

[GoCubsGo]

6. Same here.

It's handy for getting payments from cashback apps, like Ibotta and Checkout 51, without having to give them your bank account number. A lot of online vendors, like eBay, REI and Walmart use Paypal, so it's not like it's difficult to spend what you have in your account.

I agree that they have no right to close an account and take the cash. But, I also can't help but wonder if there is more to this story. It feels a bit like there's something nefarious going on, like illegal drug sales or money laundering. Could be that law enforcement is actually involved here, and the subjects are not admitting it. Whatever is going on, it's not right.

[FakeNoose]

5. They've been freezing people's accounts since their inception

It's their way of doing business - screwing people and forcing them to go along with whatever they say is "right." Occasionally they've screwed their own vendors, but mainly it's the customers that get bullied and/or cheated.

I would never give my bank account info to Paypal, and I quit shopping on Ebay when they went to "Paypal only." That was about 10 years ago and I haven't shopped on Ebay since then.

If you don't believe me, google "Paypal sucks" and see the stories people have posted. It's unbelievable!