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MDLaw
MDLaw, Attorney
Category: Business Law
Satisfied Customers: 6130
Experience:  Experience in business law, contract law and related matters.
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There,I run an online business and Paypal is holding

Customer Question

Hi there,
I run an online business and Paypal is holding over $150,000 of mine. They keep demanding more documents and nothing I send them will get them to release the money.
I don't even want the Paypal account anymore, I just want the capital back for my business that they are withholding.
I was told if I close my account they will hold it for 6 months. Can I take them to court and get this money back sooner?
Submitted: 7 months ago.
Category: Business Law
Expert:  MDLaw replied 7 months ago.
Just so that I can make sure that you are in the right category. Is your Paypal account a Canadian account or a U.S. account, i.e. in U.S. dollars?
Customer: replied 7 months ago.
It has both currencies. It operates primarily in US dollars.
Expert:  MDLaw replied 7 months ago.
Okay, what is the reason that Paypal gave you for holding your money? What documents are they demanding?
Customer: replied 7 months ago.
They don't believe we are fulfilling our customer orders. They have demanded ID, bank statements, credit card statements, supplier information, tracking information, etc. All has been provided to Paypal but still does not meet their standards.
Expert:  MDLaw replied 7 months ago.
Have you had complaints from customers or cases opened against you?
Customer: replied 7 months ago.
We have "disputes" as Paypal calls them from time to time. About 1.5% of all orders open a dispute/ask for a refund and we always comply. The exact amount being held is about 160,000. Our average order value is $14. This means this money represents over 11,400 transactions so their holding of it is absurd.
Customer: replied 7 months ago.
As of this moment there are 0 open disputes and no complaints. All customers that complain get refunds.
Expert:  MDLaw replied 7 months ago.
If you read Paypal's user agreement, it allows them to hold your money in certain instances. For example, if you have too many disputes or requests for refunds or chargebacks or if you are selling something that has a high chargeback rate, etc. Remember that Paypal is not a bank and does not have to abide by banking rules. This is why I advise people never to leave money sitting in Paypal.Because their holding of people's money is of questionable legality, many people have had success when they get an attorney involved to, for example, send a demand letter to Paypal. This might be the quickest solution for you.Please let me know if this has answered your question.