Paypal Won't Release Funds To Slain Soldier's Family 337
robustyoungsoul writes "Popular sports blog Deadspin established the Adam Knox Fund for the purpose of raising money in honor of the fallen soldier who was killed in Iraq. They took the donations through a PayPal account.
Turns out now, however, PayPal will not release the money due to the way the account was set up on their end."
release the funds... (yet) (Score:5, Informative)
A more accurate summary should have indicated the money is frozen by policy for 180 days. So, paypal is not saying they won't release the money, they won't release it until April 13.
It probably sucks for the people who raised this money, but it also sucks for paypal that too many people set up these kinds of things with intent to defraud.
Hopefully with the noise raised and ruckus caused by sites such as slashdot, the resolution will become before April 13.
FTA:
Hopefully Adam's family and platoon isn't so depleted to not be able to function until April 13. Hopefully if this is so, paypal will figure out a way to disburse earlier.
Meantime, deepest regrets and best wishes to Adam's family for their loss.
The reason why Paypal does this (Score:5, Informative)
To make things clear, the types of accounts that is:
A) New accounts
B) Unable to provide documents
C) Receiving many funds from many separate individuals
If you can't guess already.... accounts created by phishing scams!
The fact that this person is not a phishing scam is a travesty on the part that they were suspended, but the FACT REMAINS that they have no possible means to prove their innocence.
Yes I said prove their innocence. This is a company, not a trial. Likewise, they haven't been found guilty either. The reason for the 180 suspension is obvious:
If the people who sent them money start to increasingly cancel their money payments, then, bingo, the account is a scam. If they don't after a given time, say... 180 days, then hey the account is legitimate.
Paypal sucks, but not in this particular case.
Re:PAYPAL STEALS money for 180 for INTEREST!!!!!! (Score:2, Informative)
If you are going to start a legitimate charity drive, you need to follow the prescribed procedures, or you WILL encounter hassles like this one. If not from PayPal, then from the IRS.
Big surprise... (Score:4, Informative)
Re:Thanks, Slashdot! Worst Paypal scam yet! (Score:4, Informative)
Re:Thanks, Slashdot! Worst Paypal scam yet! (Score:5, Informative)
My "Screwed By Paypal" Story (Score:4, Informative)
Over the past few years, eBay has been slowly tightening the screws to get people to switch to "Business" accounts (i.e., the ones they get a percentage of every transaction on) as opposed to "Personal" accounts. First they made it so that you couldn't accept credit card payments on your personal account. (OK, fine, credit cards charge fees.) If you received a credit card payment on a personal account, you had the choice of upgrading the account or denying that charge. Then they made it so that you couldn't sell on eBay accepting paypal and NOT take credit cards, which meant you had to get a business account. (Not so fine.)
But what really pissed me off was the fact that, sometime in October 2006, they changed the rules again without bothering to tell anyone. They disabled the Deny button for PayPal payments for eBay auction if you had a personal account designated for that auction, and also made it impossible for the Payee to cancel the transaction! Before I just denied the charge, then sent a bill from the my business Paypal account. But now neither I nor my winning bidders could cancel the transaction! And both eBay and Paypal customer service (the phone support of which has been is a pay call to a call center that's re-routed to India) refused to do anything about it. I finally had to wait until it aged out of the system after 30 days, because I refuse to upgrade with a metaphorical gun to my head.
There was no e-mail or account notice of this on Paypal or eBay, just an update to the Terms of Service buried somewhere on their respective websites.
Thanks a lot, eBay. Way to ensure that GCash has an audience ready and willing to switch from Paypal at the first opportunity thanks to your heavy-handed tactics. Ditto for a GAuction, when it comes...
Re:Perhaps similar to the Somethingawful Katrina f (Score:3, Informative)
Yes, it is. The level of payment to executives and executive benefits is higher at the United Way. The percentage of payment that directly helps people is greater with the Red Cross, even if the people helping are rude.
Re:release the funds... (yet) (Score:2, Informative)
You have to opt into their "stock" account which simply means that you accept additional risk that if paypal loses value, you may lose money as well. So far its paying out a constant 5% interest for the year I've had it.
This doesn't surprise me. (Score:4, Informative)
However, Paypal would not let me associate my bank account with the account he created, since it was already associated with my account. So, we just forwarded the money in my friend's account to my account, where I then moved it to my bank account.
Apparently this set off some red flags for Paypal. They called my friend not once, not twice, but five times, each time asking him to reiterate why he created the account, what the money was for, and why I was putting it in my account. Each time he told them what it was for, why it was set up, linked them to the donation web page, etc., and the next day, they would call him back. Apparently they never made notes of the fact that they called him the previous day.
I'm very glad that I removed the money from my account as soon as possible, Paypal has been known to freeze accounts for various reasons, and it seemed like they were looking for a reason to do so in this case. The thing that I found most odd is that they put you through hoops to speak to a real person over there, but try to do something nice for someone, and they grill you like a criminal in an interrogation room.
If Paypal weren't so ubiquitous, especially among eBayers, I would never touch it again.
Re:release the funds... (yet) (Score:5, Informative)
Mod parent down--this is not accurate, let alone insightful. PayPal is not a registered financial institution (bank, savings/loan, credit union or any similar) and therefore unable to collect "float" interest on deposited monies.
This works two ways of course--as they are not a bank, the FDIC has less regulatory power over their daily operations than over more traditional financial institutions, hence reduced reporting requirements, transparency, sanction ability, etc. They do work with banks [paypal.com] but are not a primary deposit institution themselves.
They've certainly got a well and truly lousy track record when it comes to funds release and management--but investment float isn't one of the drivers of this. Were it, there'd be a half-dozen regulatory institutions over them very quickly.
(And yes, I do speak from experience in the financial services industry, before the flamers start in...)
Re:Mod Story Down (Score:4, Informative)
No, no, no!
You can receive any amount of money as a gift, and it is NOT TAXABLE. This is why tips are a special category of income. You might think a tip is a "gift" to your server, but the IRS says it's a tip, not a gift, and thus taxable. There used to be these little cards that you could leave on top of your tip that said "This money is a gift, and not a tip". But I don't think they work :)
When you are the one doing the giving, then YOU are the one who has to pay a "gift tax", unless it's under the annual exclusion which is (this year) $12,000 per person you gift. Anything over the annual exclusion goes into the "lifetime estate exclusion" bucket -- so if you pass your estate on to someone after you die, they get to pay taxes on it if the amount of the estate is (this year) $2,000,000 MINUS the lifetime estate exclusion.
WTF does this all mean? These guys can take in $20k and give it to two people without anyone having to pay any taxes at any time. Which is why you were wrong.
If, on the other hand, he gives the full $20k to one person, then $8k is above the exclusion, which means his eventual estate inheritor can now only inherit $1,992,000 tax-free. So he probably still doesn't have to worry, but he shouldn't make this a habit.
I'm not an accountant, but I play one on the Internet!
--Rob
Paypal sucks! Rabble rabble! (Score:3, Informative)
Re:release the funds... (yet) (Score:2, Informative)
Re:release the funds... (yet) (Score:5, Informative)
In the typical case PayPal is not being paid per se when monies are transmitted to it. Rather, it's acting as a very limited management agent--it has no asset claim on those monies. It does, as we all painfully know, have considerable transfer and refund control on your deposits, per their terms of service. But they can't treat them as controlled assets--it's not their money to directly profit from.
Even though not regulated as a bank, their investment cash flows are subject to the same statutory control as anyone else's. About the best they could do would be to offer to invest it for you, return profits to you, then collect a "management" commission on the invested funds. In truth, however, that gets them perilously close to bank-dom and the associated governmental oversight, which they pretty clearly want to avoid.
Re:release the funds... (yet) (Score:3, Informative)
Their "genius", if you can call it that, is in presenting a merchant-bank-like deposit and transfer service, without having to deal with most of the regulatory hassles associated with a traditional merchant banking service.
There are other esoteric streams in their model, I'm sure, but the "fee for service" charged to merchants provides the overwhelming lion's share of their revenue.
Re:Perhaps similar to the Somethingawful Katrina f (Score:2, Informative)
Re:Yea, Paypal Sucks, but this is a bit dramatic. (Score:5, Informative)
Re:Any good stories about Paypal? (Score:5, Informative)
My account was usable again a week later, but that was mainly my fault for cancelling the direct debits and cards linked to the paypal account the morning I discovered the activity, so I had to reset up the paypal - bank account conduits.
Funny thing is, I actually made money from all this
All in all, I have had excellent customer support from Paypal and all the other anecdotal websites around dont match my experiences.
Re:Seems innocent enough. (Score:3, Informative)
PayPal Customer Service Agents are available to help you during the following times:
4:00 AM PST to 10:00 PM PST Monday through Friday
6:00 AM PST to 8:00 PM PST on Saturday and Sunday
Call us at: 1-402-935-2050 (a U.S. telephone number)
This is the first non-toll-free customer service line I've seen in a very long time -- definitely a slap in the face to customers who need assistance.
Re: Yea, Paypal Sucks...and that's on a good day (Score:3, Informative)
Evil, Palpal is.
The verb is either at the front of the sentance, or at the end (or both), depending on whether it includes the "to be" verb.
"away put your weapon"
"Begun, the clone wars have"
Re:Any good stories about Paypal? (Score:3, Informative)
They said they would not refund it, but they did say they would subtract the amount they'd taken from my *next* Pay Pal purchase. Once bitten twice shy however - I have no desire to do business with any company that act's like that (not least as it's downright illegal - and they know that it seems, given their cookie cutter email reply had a whole paragraph on 'Don't complain to your Credit Card vendor.' and all the bad things they will do (e.g. freeze your account and funds- if you have one) if you do so).
I don't much like being bullied, and I had nothing to lose, why is why I 'dared' and ratted them out for breaching MasterCard's T&C's.