Paypal are bastards?

Discussion in 'Indie Business' started by Chris England, Sep 10, 2010.

  1. Chris England

    Chris England New Member

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    As some of you will already know, this happened recently:
    http://www.rockpapershotgun.com/2010/09/10/paypal-freezes-minecraft-devs-600k-euros/

    I find that a bit worrying, as while I can see why the issue has arisen given the sums of money involved, it's apparently been going on for 3 weeks with no resolution so far, which seems a bit excessive given that everything seems to be above board at Minecraft's end.

    I saw Cliffski posting on the thread recommending BMTmicro and Fastclick (or something) instead of Paypal, and I was wondering if other people had experiences with Paypal that they wanted to relate?

    Essentially, I'm going to be looking to take pre-orders on my title shortly. I will make it quite clear on the purchase page that the money is non-refundable, as some or all of it will be used to further the development of the game - in fact, I may well put up a section on the site saying 'if we get X numbers of pre-orders, we'll add this feature to the game' etc.

    Obviously I don't want to be in a situation where I think "Great, I have 200 pre-orders so I can afford a really flash GUI!" and then find that I can't afford to pay the guy after he's done the work, as a bunch of people decided they wanted refunds.

    I'm not expecting massive amounts of pre-orders, a couple of hundred would be lovely, so I doubt I'd fall foul of whatever alarm goes off when you get 600k Euros arriving in your account three weeks, but I now have some misgivings about Paypal.

    My only concern is that the suggested alternatively have transaction costs of 9-10%, whereas Paypal is less than 5%. That's a considerable price differential...
     
  2. Artinum

    Original Member

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    I use Paypal for my proofreading services and have never had any problems with them. Admittedly, I've never had to invoice someone for $600K, but for that amount it would probably take me about ten years to read through their texts!

    I suspect Paypal are acting not of their own volition - why would they want to deny themselves the fees/interest on that sum of money? - but under legal obligation. Receiving $600K in small amounts over a short space of time is likely to set off alarms labelled "potential money laundering".
     
  3. Maupin

    Original Member

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    The first rule of Paypal is to never keep a large amount of money in your account - always, always, always withdraw it into the safety of a real world bank account when it reaches an amount that you'd rather not see suddenly disappear.

    I've never had my account frozen, but have dealt with Paypal support over the phone about account problems and it's enough to make you cry for humanity.

    And yes, they are bastards. Lying bastards.
     
  4. barrygamer

    Original Member

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    I never touch paypal now, or ebay. If paypal is the only way of paying, then I move along.

    edit- can't people use Google checkout? At least they are regulated in the Uk by the FSA.

    Oh, and Minecraft looks v interesting indeed.
     
    #4 barrygamer, Sep 10, 2010
    Last edited: Sep 10, 2010
  5. meds

    meds New Member

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    99% sure this isn't PayPals fault, had the money been going into a bank account the same thing would have happened.

    Basically when you're moving large amounts of money to and from an account (especially when they spike up from virtually nothing just a few days before) organizations which oversea these transactions are pretty much required to prove the people involved in the transactions are not terrorists (thanks, Patriot Act!).

    This isn't exclusive to PayPal, and I'm sure once he sends the relevant documents in to them PayPal will open up his account again.
     
  6. Indiepath

    Indiepath New Member

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    Why would anyone keep that amount of money in a paypal account? They should have moved the money to their approved business accounts ASAP. Unless they didn't have approved business accounts!!

    But either way, this is a poor situation to be in.
     
  7. puggy

    Original Member

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    it's most likly been frozen due to european financial law and most likly it won't be paypal thats going to hold things up but invesigators checking things out which will slow things down.

    A few years ago i had my account frozen (at a bad time too) as once you go over a certain amount of money (i think it was £4k at the time) you need to have a bank account verified.

    There are a lot of reasons for your paypal account to be frozen and most of those are due to rules enforced upon paypal by various goverments rather than paypal trying something, which unfortunatly paypal gets the sole blame for
     
  8. speeler

    Indie Author

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    The developer (Notch) says he does transfer everything out of his Paypal account each week. That's how much has accumulated since they locked it.
     
  9. Jack Norton

    Indie Author

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    Yes let's not blame paypal too much on this specific case. He's probably the only person on earth to have made so much money so quickly by using paypal :eek:
     
  10. bantamcitygames

    Administrator Original Member Indie Author Greenlit

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    After all of the past horror stories I've heard about PayPal, I would never leave that much money in my account.
     
  11. Escapee

    Original Member

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    I never have any problem with Paypal but I will never keep more than 1.5K in my account.

    600K in Paypal !? Holy Buddha ..... He is very brave..
     
  12. Backov

    Original Member

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    Paypal are indeed bastards.

    A while back I had a business that got the majority of its money through Paypal from customers. Not even a lot of customers, a couple dozen at most.

    Of course, once that happened, they froze the account with a bunch of money in it. You know, because it was receiving money.

    They were complete bastards about unfreezing it, we sent them every single thing they asked for and they just wouldn't get around to unfreezing it. Finally my business partner dug out a business card she'd got at a convention for a Paypal VP. She was a pretty big dog in another payment processor and she phoned him up. Account was unfrozen twenty minutes later, no explanation for why it was ever frozen.

    Bastards.

    Never, ever, build your business on top of the unregulated bank that is Paypal.
     
  13. RiVEN

    Original Member

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    I find you brave at 1.5K ;) I'd be draining my account at £300 at the most.
     
  14. Jamie W

    Original Member Indie Author

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    Absolutely, and the second rule of PayPal...

    I'm sure I heard this somewhere, about not attaching it to a debit card, where they can take money out of your account. So you want to limit the scope they have for taking money from you, unanounced. I'm sure the advice was to use a credit card, or not link it to your bank account, something like that...
     
  15. ChrisP

    Indie Author

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    Yes, yes, a million times yes. Paypal are evil conniving bastards. This is completely unsubstantiated, but my impression has been that they make a lot of their money by locking the accounts of their clients whenever they can dream up an "anti-fraud" excuse, and then making the unlocking procedures inconvenient enough that many people don't bother to follow them. Hooray, free money!

    I had my old account locked a number of years back when I allegedly entered an "incorrect" password three times (I'm 100% sure it was correct). The only recourse was to mail them a bunch of documents including my passport. Screw that! Thankfully there were only a couple of dollars in there. It would actually have cost more to mail off the required documents than I would have recovered by doing so... :)

    In any case - avoid.
     
    #15 ChrisP, Sep 11, 2010
    Last edited: Sep 11, 2010
  16. GolfHacker

    GolfHacker Member

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    Wow. I've never had a problem with PayPal. Of course, I'm just a small fry with less than $200 going back and forth through my account each year. Most of my customers come through my Plimus account.
     
  17. Vino

    Vino New Member

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    I have a suspicion that they make their money when small amounts are transferred and lose money with large amounts, so they look down on you having too much cash in there.

    Just a suspicion.
     
  18. Bad Sector

    Original Member

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    What can you do?

    Paypal, for all its issues, is the biggest player on their field. Not having a means to get paid via paypal is shooting yourself in the foot. And people *want* to pay via paypal - including me. It is much easier and safer to pay via paypal.

    Btw has anyone thought the possibility of Paypal locking his account in suspicion of someone taking over it? Someone can take over the account, add random money and then receive all of it (the random money they added and the existing account money). Notch's post mentions "suspicious withdrawal or deposit" which is in line with that and having a sudden spike in sales can trigger this. Obviously it is wrong but Paypal has a huge number of accounts and these things are automated and prone to error. Would it be better if someone actually did that (take over the account)?

    Yes, Paypal uses strong language and tactics and behaves as if all their customers are thieves but in reality many of them are and these are the people who will harms others, not the proper behaving.

    If there was an alternative *like Paypal* (not just for selling software but something arbitrary - you can send money to whatever reason to anyone via Paypal) and had the exposure and size of Paypal, i believe they would behave the same.
     
  19. Jack Norton

    Indie Author

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    Use a vendor like BMT who accepts Paypal :D Sure you lose a % of income but at least you sleep peacefully.
     
  20. jcottier

    jcottier New Member

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    Listen to the man. This is anti fraud law here, nothing for him to worry, it will be solved and he will get his money back.

    JC
     

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