Chris Rossi

So here’s the story of how I was permanently banned from using PayPal.

In late 2008, I made a post on a web developers forum asking for someone to build a PHP script to extract thumbnails from FLV files (Flash Video). At the time I had to manually take screenshots of videos I post on my site, the point of the script was to automatically generate thumbnails of the videos as they’re uploaded (similar to YouTube). Although I’m very well versed in PHP programming, I’m not very familiar with FLV files and how to extract thumbnails (it required access to extra server software).

I had only 2 offers, and I went with the first one as the developer had already written a script for his own website and said it would only take an hour to modify it for my use. So I sent him a payment via PayPal, as he requested, and a few days later he emailed me the script.

All good, another successful PayPal transaction. He got his money, I got my script, everyone was happy.

Or so I thought…

A week later I received an email from PayPal saying that I had “violated their Acceptable Use Policy regarding Mature Audiences”, and they had permanently closed my account.

Stunned, I requested more information from them. The response said that I was not to use PayPal to purchase “Sexually Oriented Digital Goods”, and pointed me to the transaction. It was the transaction for the PHP FLV software.

It turns out that the developer that sold me the software was (unknown to me) also using his PayPal account to charge for access to his adult website, and anyone he had transacted with was automatically banned for life. I immediately attempted to contact him to request that he tell PayPal that our transaction had nothing to do with his website, it was a simple payment for software he had written. But I received no replies at all, no matter how many times I tried to contact him.

I begged for an appeal from PayPal. They ignored me, and kept sending me canned replies like this one:

We cannot overturn the limitation on your account.  Due to the violation of
PayPal’s Acceptable Use Policy regarding Mature Audiences, your account has
been permanently limited.
You will not be able to use PayPal for any future transactions. An appeal
is not available.

To which I replied:

Dear PayPal,

I do not accept your canned response. You have not looked into my account’s history, and you have not conducted yourselves in the way a business should.

I have always been a loyal customer to PayPal, I have made countless transactions using your service, never with any problems.

I do not consider this matter by any means closed.

I request the account to be immediately reactivated so I can make payments on eBay for legitimate items. I can provide details for a full Australian credit check if required, or a payment for a once-off account restoration fee if needed.

Please respond once the situation has been properly examined.

They never explained why they weren’t going to overturn the limitation of my account. I kept trying, but eventually I had to give up. I had to abandon the eBay business I was in the process of starting up, because I wanted to sell to international customers and PayPal is the only payment method I could offer them. I also couldn’t receive commission payments for earnings from my website (luckily Amazon and Google don’t use PayPal, or I’d have had to shut down all my websites).

I heard on a forum about issues with PayPal that other people had success by waiting 6 months and then creating a new account, once the old one had been permanently closed. I waited more than a year, just in case.

Because both of my VISA cards and my bank accounts were linked to my old PayPal account, I couldn’t use them for my new one. So I went to my bank and had a new account created, which I then linked to my new PayPal account.

Everything looked good for a while. I received the confirmation payments successfully to validate my account, and I was able to use PayPal to send $10 to a seller on eBay.

But while the $10 payment was processing I received this email from PayPal:

The PayPal User Agreement states that PayPal, at its sole discretion,
reserves the right to limit an account for any violation of the User
Agreement, including the Acceptable Use Policy.
We are hereby notifying you that, after a recent review of your account, it
has been determined that you are linked to other PayPal account(s) that
have violated PayPal’s Acceptable Use Policy.  Customers who are
permanently limited for violating the Acceptable Use Policy are not
permitted to open new or additional PayPal accounts. Therefore, your
account has been permanently limited.
Customers who are permanently limited for violating the Acceptable Use
Policy are not permitted to open new or additional PayPal accounts.

Of course, they closed my account AFTER taking my $10 from my bank account. I don’t know if the eBay seller will receive it, I hope so, otherwise I might receive negative feedback for having to cancel the transaction. If they don’t pass the money onto the seller, I’ll have to wait 180 days before I can get it sent to me as a cheque in the mail (during which time PayPal earns bank interest on it).

I immediately responded to their email:

Dear PayPal,

I dispute that my account was limited for violating the AUP, it is completely unfair that you should permanently block me from using your services.

My original account was banned, after MANY legitimate transactions and more than 5 years of usage, because you claimed I had used PayPal to access "Sexually oriented Digital Goods".

In reality I had sent a payment to another programmer for legitimate software he had written, namely a "PHP FLV Image Thumbnail" script (which extracts JPG screenshots from FLV video files). I use this software on my website http://www.bluesbrotherscentral.com to handle my video files.

It was a paid custom project I commissioned through a request on a programming forum, his offer was the one I accepted (he had already built the software for himself, I was paying for him to customize it slightly for my own requirements).

I was completely unaware that this programmer was also using his PayPal account to sell "Sexually Oriented Digital Goods". I have tried to contact him many times in the hopes that he would explain this to you, that our transaction had nothing to do with his unrelated website. However I have been unsuccessful in reaching him.

I waited more than 12 months before creating a new PayPal account, so I can receive a year’s worth of payments for t-shirt sales on my website, and also to purchase several items on eBay from sellers that only accept PayPal. And now you have blocked my new account, once again crippling the ability for me to do my business, just because the recipient of my payment was (unknown to me) also using his account to sell inappropriate products. My account should not have been blocked based on the poor decisions that he made.

I can provide any information you require, including full details of my work, examples of my programming portfolio, and even my financial/income statements to prove that I am a legitimate customer. If you like I can even send you the ACTUAL script that this developer built for me and which I used PayPal to pay for.

Could someone please contact me to discuss this, I cannot accept another canned response from someone who hasn’t read my email. I simply can’t go one more month without having access to PayPal’s service
s.

I received a response the next day:

We regret to inform you that we cannot overturn the limitation on your
account.  Due to the violation of PayPal s Acceptable Use Policy, your
account has been permanently limited.
As we already informed you, customers who are permanently limited for
violating the Acceptable Use Policy are not permitted to open new or
additional PayPal accounts.

I admit, I got a little angry after that:

My question is what did I do that was so wrong that I’m banned from PayPal for life?

Paying for Drugs: Banned for Life
Paying for Weapons: Banned for Life
Paying for a PHP FLV Thumbnail Generation Script: Banned for Life??

I paid for legitimate software from a seller that was also using his account for something that violates your AUP, however I myself DID NOT violate your AUP.

If I buy a t-shirt from a person that also sells marijuana, should I be arrested for buying drugs? NO, and no court in the world would try to prosecute me for breaking any law.

I still haven’t been given a satisfactory answer about what exactly I did wrong. I get the same canned replies from people who won’t bother to look into my situation or try to help me. I resent being treated like a criminal, all because somewhere along the line one of your employees mistakenly got it into their head that I had broken one of your policies, when in actual fact I have done nothing wrong.

I want my account restored so I can receive my commission payments. I’m losing real dollars, and you’re losing the money you would make by letting me continue to be a customer. I have a business I’ve been trying to get going for over a year, and the ONLY THING stopping me from going ahead is the fact that I can’t receive PayPal payments.

This is completely unfair, I have done nothing wrong and I keep getting the same canned replies from people who don’t seem to understand that.

I did not violate your Acceptable Use Policy! How many times do I have to tell you that before you restore my account?

I didn’t buy drugs or weapons, I didn’t buy "sexual" content, all I bought was a simple PHP script to generate JPEG thumbnails from FLV videos, which I ended up using on my website. Tell me what’s so wrong about that? I’ve bought dozens of software products using PayPal before, such as FlashChat, vBulletin and vBSEO, and none of these resulted in my account being banned. And yet as soon as I buy from this seller, you accuse me of breaching your AUP.

This is unfair. I want a response from someone who has actually read my email, speaks English as their first language, and accepts that I did NOT violate any of your rules!

I then received another email with the subject “Appeal Denied”:

We regret to inform you that we cannot overturn the limitation on your
account.  It has been determined that your current PayPal account   is
linked to other PayPal account(s) also pernamently limited that have
violated PayPal’s Acceptable Use Policy.  Customers who are permanently
limited for violating the Acceptable Use Policy are not permitted to open
new or additional PayPal accounts.
Please remove all references to PayPal from your website(s) and/or
auction(s).  This includes not only removing PayPal as a payment option,
but also the PayPal logo and/or shopping cart.

So basically the reason why my account is banned is because my other account was banned and therefore I’m banned for life from PayPal.

I responded back:

Dear PayPal,

You have once again completely misunderstood the situation.

I am not disputing that (PayPal Email #2) was limited because it is linked to another limited PayPal account (Paypal Account #).

What I AM disputing is the reason for the (PayPal Email #1) PayPal account being limited in the first place!

I am politely requesting, once again, that either (PayPal Email #1) is unblocked OR (PayPal Email #2) is restored.

As clearly stated below, (PayPal Email #1) did NOT violate any of your Acceptable Use Policy. Therefore it is grounds either for the immediate restoration of (PayPal Email #1), OR the restoration of (PayPal Email #2). Personally I would prefer that my Gmail account is reinstated as it is where my commission payments are supposed to be sent.

Either way, there is ZERO justification for me to be permanently banned from using PayPal’s services. I have, as stated very clearly below, NOT violated your acceptable use policy.

I await your response and resolution to the grossly unfair situation that you have placed me in.

(I have hidden my PayPal email addresses for privacy reasons).

I am still awaiting a response from them, but I’m not expecting much help.

I’ve tried calling them, but it’s a well known fact that their phone support is as useless as their email support. In fact their phone staff have no ability to do anything to resolve situations.

I really have no idea what else I can do, apart from keep arguing with them and keep getting canned replies back from them.

This is no way for a business to operate. Condemning a customer for life because of something they didn’t do, with no appeal, is completely unfair and unjust.

Maybe I need to register a business name and a business bank account, and get myself a Post Office Box so I can setup an account under that name. Then maybe they won’t detect that my new account is linked to me. It’s far from an ideal solution.

Update: April 11, 2010

My response from PayPal:

It has been determined that you are linked to another PayPal account
that has violated PayPal?s Acceptable Use Policy.  Customers who are
permanently limited for violating the Acceptable Use Policy are barred
from future use of PayPal and its services, and are not permitted to
open new or additional PayPal accounts.

Our records show you have another PayPal account under the email domain (email hidden). We have determined that this account was used to
purchase from a website in violation of our Acceptable Use Policy. The
severity of the violation is such that any linked accounts will be
permanently limited.

Users whose accounts are permanently limited for violating the
Acceptable Use Policy are barred from future use of PayPal and its
services, and such users are not permitted to open new or additional
PayPal accounts.  We stand by our decision to limit your account, and
will not reverse your account status.  We have reviewed your previous
correspondences and determined that a sufficient explanation of our
actions has been provided; therefore, we consider this matter closed.

You will not be able to use PayPal for any future transactions. An
appeal is not available.

Sincerely,
PayPal Acceptable Use Policy Department
PayPal, an eBay Company

Once again, nothing helpful, but at least they are starting to look into it more deeply than the previous “screw you, customer!” replies I received until now.

My response to the above email (with email addresses hidden)

The (Account #1) account was NOT used to purchase from a website in violation of your AUP.
It was used to purchase legitimate software (namely the aforementioned "PHP/FLV Thumbnail Generator") from the webmaster of the website that violated your AUP.

There is a difference. I had NO knowle
dge that the webmaster ran the aforementioned violating website.
I had NO knowledge that the website even existed. I have never visited the website, or paid for a membership in said website.

I have simply paid for software that the webmaster had written. I did not use my PayPal account to violate your AUP, regardless of what the webmaster was also using his account for.

If an eBay seller is also using his PayPal account to sell weapons, should I be punished for buying a pair of shoes from him on eBay? Definitely not.

This is the exact same situation, I paid for legitimate software with zero knowledge of what the offending webmaster was using his account for.
If I had known that I would be paying into his violating account, I would either have:

1. Asked him for an alternate payment method outside of PayPal, or
2. Rejected his offer to buy his PHP/FLV Thumbnail Generation script and found someone else to write it instead.

I am not guilty of violating your AUP. I used my (Account #1) account to pay for legitimate software.

I will not admit any wrongdoing, it is a matter of principal. I did not do anything wrong, and it is clearly unfair to punish me for it.

My (Account #1) account was only ever used for legitimate transactions. As such, I continue to call for the immediate restoration, either of my (Account #1) account, or the new (Account #2) account so I can continue to use my account for legitimate transactions.