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Fri Sept 4 2015 12:23:46

How an Empty Cigar Box Can Lead to a PayPal Nightmare

By: Reader

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Dear Ina,
I have had a PayPal Account since their inception. I have offered PayPal on ALL my ecommerce sites.

I recently sold an EMPTY 1940's Cuban CIGAR BOX on an alternative site. The Buyer paid with PayPal. The payment was immediately marked: held / under review.

I called PayPal 5 days ago. The Rep. reviewed the listing. She laughed. She said she would send an email to her Boss with the info.

Today I awoke to a complete shut down of my PayPal Account. They reversed all my bank deposits. No one can pay that account or any email associated with it.

I submitted 15 pieces of evidence that:
1. I normally do NOT sell items marked Cuba.
2. The item was for craft purposes to a U.S. resident.
3. NONE of my other sites HAVE items from Cuba.
4. IF PayPal had a 'problem' w/ the item, why not just REVERSE the sale & send me a letter ?
5. As this was my FIRST "infraction", don't you think I should have been treated "better" ?

A quick search of eBay, where ONLY PayPal can be used, not only reveals thousands of Cigar Boxes quite obviously FROM Cuba, but, 164 with CUBA in the TITLE.

I was told I can NOT speak w/ anyone in Compliance. I was told my documents and case MAY be "reviewed" in 48-72 HOURS. As this is Wednesday, that means, if NOT "reviewed" by Friday, I cannot accept PayPal until:

1. AFTER the long Holiday weekend 09/08/15
2. IF and WHEN PayPal corrects this mess.

Sure, on OTHER sites, I can accept ALTERNATIVE payments. But, not on eBay. So, I ended over 279 listings. 

PayPal has effectively destroyed my ability to sell. WARN your readers. Do NOT let PayPal be your ONLY source of income. One snafu, one problem, you could be SHUT DOWN.

Please do NOT print my name.
G.

Note from the Editor: We've previously covered this issue, including this article from August 2013. This serves as a reminder to others, and we wish this seller the best of luck in resolving the issue.

Update: The seller clarifies: "The item was NOT PROHIBITED on the SITE. Had PayPal actually LOOKED at the listing, from 08-31 until 09/03 THURSDAY when they shut me down, they would see the item was NOT in violation of the import/export restriction. Instead, a "bot" or a harried or uninformed employee shut me down."




Comments (39) | Permalink

Readers Comments

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

This user has validated their user name. by: Rexford

Fri Sep 4 12:30:36 2015

Get an good "fire in the belly" attorney.  These two companies are out of control.  

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

by: epuise This user has validated their user name.

Fri Sep 4 13:20:17 2015

Ina,
The problem is not w/ U.S. Sanctions. The problem is with PayPal & their knee jerk reaction to a fine they paid. I had been pro-active on the initial hold. Immediately called PayPal 08-31, was told it would be 'taken care of'. Tried to cancel the order. It was later I discovered, had PayPal LOOKED at the TITLE ''1940s'', and the PICTURES 1944 U.S. Tax Stamp FROM TRENTON NEW JERSEY, that this was NOT a post 1963 Cuban IMPORT, but an item that was IN the U.S. 15 years BEFORE Castro took office in 1959. I would have understood if PayPal froze or returned the payment.
I would have understood a warning letter. They were sent links to my various vintage sites' listings.
Instead, as the PAYING user of PayPal... My account, which is a forced payment on eBay & favored by BUYERS everywhere, was SHUT DOWN because NO PAYMENTS could be SENT there. If PayPal is going to so swiftly accuse, condemn, and punish...
they have a FIDUCIARY RESPONSIBILITY to use that POWER with DUE DILIGENCE.

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

by: epuise This user has validated their user name.

Fri Sep 4 13:33:42 2015

Also, the 'shut down' occurred on 09-03 a THURSDAY, w/ a 48-72 response time, that ensured that Compliance would NOT have TIME to review BEFORE the long Holiday Weekend. And, why didn't PayPal Compliance have TIME ? From 08-31 to 09-03 is 3 full WORKING DAYS, 72 hours. If they are going to control a Seller's business(es), they have a responsibility to GET THE FACTS. Now, if my sites were RIDDLED or, had ANOTHER 'bad' item, sure, shut the payment service off. But, there was NO evidence of this. PayPal can SEE my history. NO complaints. NO bad "patterns". U.S. resident. They did none of that. Instead, in the United States Of America, I was GUILTY until proven innocent (or, PayPal is satisfied). How sad that I TRUSTED PayPal all these years. ALWAYS defended it. Stay on the 'up & up' I said. Dot your 'i's, cross your 't's. Describe well, take clear pics, pack securely, ship fast. WHY am I ON LINE 24/7, taking care of Customers ? So a payment service can stop my Buyers from ordering/paying. So I can be 'reported' to the OFAC ? Wow, just wow. I have no words to describe how this has affected me. And, ANY ONE of you could get caught in the web of error. An item that you may have sold for YEARS could get you in trouble. An item the SITE you are on does NOT prohibit. And, even KNOWING the LAW, items PROVEN to be in the U.S. pre-Embargo, will not protect you. So, offer PayPal. But, have a BACKUP. A Merchant Account, etc. IF you NEED the INCOME, like me, protect your ability TO earn an income.  

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

by: gramophone-georg This user has validated their user name.

Fri Sep 4 13:48:30 2015

I'm familiar with this seller and this case- the clincher here is that the box in question even has a United States tax stamp on it indicating that taxes were paid and the box was in Trenton, NJ as of 1944!

In my opinion, the only reason this is an issue is because PayPal is having fun at this seller's expense.

Has PayPal turned into eBay? Sure sounds like it from a CS standpoint!

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

by: gramophone-georg This user has validated their user name.

Fri Sep 4 14:04:56 2015

Ina, I reviewed the article from 2013 that you referenced and also another article linked in that one... neither article would seem to apply here.

That said, as with most eBay/ PayPal policies and explanations, they are both so vague in their wording that the only real workable conclusion that anyone can take away is that the policy is simply ''we'll do whatever we want''!

The article you referenced from '13 ended with this comment:

'' Sellers noted PayPal blocked payments for items like coins and stamps from countries like Cuba and North Korea, even though the sellers of those items weren't located in the sanctioned countries. EcommerceBytes reached out to PayPal for comment regarding these items but hadn't received a response by press time.''

Did you ever get any further comment? I'll bet not.

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

This user has validated their user name. by: WOODJUNGLE! ON EBAY

Fri Sep 4 14:10:34 2015

I have also had my issues with PAYPAL and pre-embargo items from Cuba as well. OP, did you have other issues with this?  The reason I ask is because the first couple of times,  they don't suspend your account from operating. They just give you a warning.  This happened with me twice. I then wrote them a note saying I'll be good and won't sell items from Cuba and went on my merry way.  Will they  lift the darn  embargo already??

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

This user has validated their user name. by: WOODJUNGLE! ON EBAY

Fri Sep 4 14:11:26 2015

I forgot you DID mention it was your first infraction. Odd.

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

by: epuise This user has validated their user name.

Fri Sep 4 14:49:58 2015

Hi, Woodjungle...
NO... NEVER had ANY infractions... EVER... no knockoffs, no sanctioned items, no warnings, NOTHING.

The (very nice) PayPal Rep on 08-31 SAID: You have a perfect history w/ us. Maybe when she forwarded her notes to her ''Boss'' email, HE couldn't be bothered reading, looking at pic, and HE loaded the guillotine ?

Whatever... I am shell shocked... have heard NOTHING in response to my 15+ evidence submissions.

The NOTICE states:

PayPal is constantly working to ensure security by regularly screening the accounts in our system.

We recently reviewed your account, and we need more information to help us provide you with secure service. Until we can collect this information, your access to sensitive account features will be limited.

We would like to restore your access as soon as possible, and we apologize for the inconvenience.

Why is my account access limited?

Your account access has been limited for the following reason(s):

Sep 3, 2015: You may be buying or selling goods or services that are regulated or prohibited by the U.S. government.

We would like to learn more about your business and/or some of your recent transactions.

How can I get my account access restored?

It's usually pretty easy to take care of things like this.

Most of the time, we just need a little more information about your account or latest transactions.

To help us with this and to find out what you can and can't do with your account until the issue is resolved, go to the Resolution Center.

We'll review the information you provide and email you if we need more details or when your account is back to normal.

Completing all of the checklist items will automatically restore your account access.

^ THIS is 'automatic restoration ?

Good thing PayPal is not in the EMT/Medical profession !

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

This user has validated their user name. by: WOODJUNGLE! ON EBAY

Fri Sep 4 14:51:49 2015

Weird

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

This user has validated their user name. by: Basset

Fri Sep 4 16:49:10 2015

The Donahoe effect?  

Makes absolutely no sense - Looking at a vintage cuba cigar box sitting here in my office -  purchased empty on eBay way back when, it now holds my what-nots. Paid for with PayPal, too.


How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

by: epuise This user has validated their user name.

Fri Sep 4 17:05:35 2015

175 Cigar Box Cube / PayPal Accepted Filter (eBay)

http://www.ebay.com/sch/Collectibles-/1/i.html?_from

=R40&_sop=16&_nkw=cigar%20box%20cuba&rt=
nc&LH_PrefLoc=98&LH_AllListings=1&LH_PayPal=1

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

by: Volvo351 This user has validated their user name.

Fri Sep 4 20:22:37 2015

Typical shoot[the seller]first, ask Q's maybe never action by PayPig. And, BTW, aren't we supposed to be "normalizing" relations with Cuba, according to Barry Hussein?

Un-freakin' real.

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

by: epuise This user has validated their user name.

Fri Sep 4 20:59:37 2015

Two full days. No response from PayPal.

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

This user has validated their user name. by: iheartjacksparrow

Fri Sep 4 22:00:42 2015

@epuise - Since you state that the sale in question was on an alt site and not eBay, I hope you have immediately canceled PayPal as a payment option and added whatever other credit card processor(s) are available to you on that site.

This is the perfect example of why no one should offer PayPal unless absolutely forced to (on eBay). Besides imposing a 180-day return window, now they are freezing accounts for apparently no reason. And if they are just a "money transmitter," why would they even care what's being purchased? Are they now scrutinizing every item paid for with PayPal? Is this another scheme by JD to rid the internet of small sellers?  

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

by: epuise This user has validated their user name.

Fri Sep 4 23:25:06 2015

@iheartjacksparrow... PayPal is off Etsy, I now offer their system, and Stripe for eCrater.

IF I decide to continue w/ eBay, I will look into a Merchant Account.

If PayPal wants me to keep them, I will need Compliance to send a detailed explanation of why a perfect account was shut down before an investigation was DONE.

I will have lost a week's worth of income because of their failure to due proper diligence. With power comes responsibility.

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

by: epuise This user has validated their user name.

Sat Sep 5 09:47:44 2015

This is the problem w/ 'investing' the profits of eBay & PayPal into 'executive compensation'...

the infrastructure & support staff are inadequate. Remember the eMail hack, the DSR nightmare ? You tried to call and you waited HOURS for a CS Rep. Inadequate staffing.

And, a PayPal Rep. describes the Compliance Dept., who you cannot speak to, as 'small'.

So, this 'small' Dept., these over tasked employees, have to 'flag', then 'review', then 'investigate' that 1944 empty cigar box. This means, at best, you, the Seller, has a locked PayPal Account, and, no sales. It means you lose a day, a week, a month's worth of income.  

At worst, a harried employee under a quota suspends your account permanently, as they don't have the time to get all the facts.

On eBay, that means you are out of business. As PayPal is now 'the currency of the realm'.

This is all very scary for anyone who depends on eBay or PayPal for their livelihood.

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

This user has validated their user name. by: Rexford

Sat Sep 5 12:35:30 2015

gramophone georg says "Has PayPal turned into eBay? Sure sounds like it from a CS standpoint!"

Yes, JD is there now. In my opinion this man has issues. I personally think that he is business poison.

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

by: epuise This user has validated their user name.

Sat Sep 5 14:15:50 2015

09-05-15

I just received a call from a very nice, concerned, intelligent PayPal Compliance Representative.
After a lengthy conversation,
I wish to share the following,
as I posed any 'example' I could think of.
This is what I remember, and, in no way represents PayPal's Policies.
You should spend time reading the restrictions.
The Rep said if you have ANY item you are NOT 100% sure is safe:
Call PayPal, ask for a Supervisor,
who will take the information & have Compliance respond w/ an answer.
Do NOT take anyone's 'word'.
WAIT for Compliance to get back to you w/ the ACCURATE info.
''Restricted Items''
PayPal's Terms Of Use has a broad brush definition of items that COULD impact your account.
The 'Cuba' as a restricted Country of origin/destination is an EXAMPLE.
Now, let us assume you wish to sell your pre-embargo empty Cuban Cigar Box.
You go to eBay:
If you are ''lucky'' (not my words, what an eBay Rep told me):
When you go to list it, a red flag will pop up and warn you.
However, he continued, ''not all sellers get this warning''.
So, you list it. If a 'bot' doesn't 'batch' catch it, if nobody reports you, it stays up.
It sells. Buyer pays. You ship. You withdraw the PayPal funds.
Home free, you think.
Wrong.
PayPal has 'bots' for this.
First thing they do is 'flag' the account(s), the seller AND the buyer.
They freeze the sale, all your PayPal balance, and reverse any uncompleted withdrawals.
You get a notice. Then, you get a 'restricted' account.
All the eMail addresses associated w/ that PayPal account are affected.
No buyer can pay you for anything else. You can't cancel orders or refund money.
Then, after 48-72 hours, PayPal asks for a list of 'stuff'.
What you sell, where you sell, and info. about your item.
You can't talk to anyone. All you can do is upload documents.
Then, they review that. RARELY do they reinstate a PayPal account.
99.9999% of the time you are gone. Poof.
Yes, you can spend days appealing.
No, I do not know what it takes to reverse this.
PayPal's policy is to ban these gray areas in a blanket.
The are endeavoring to avoid any & all 'problems'.
So, you say:
I will list my item on Etsy. They like old cigar boxes there.
And, there are no popup red flags.
So, that is where you list it.
And, if you accept PayPal there, guess what ? yep. Poof.
Now the clever among us may offer:
Well, what if I sell and, just use a friend's PayPal account ?
Guess what ?
That is an 'associated' account.
Same punishment.
Plus, you look worse now if you try to appeal.
You circumvented a restriction.
What if I list it as 'old cigar box', no mention of Cuba ?
List my Ivory item as 'bone' ?
Same argument as running a red light, maybe you get away with it.
What you need to understand is some words are red flags.
Even a Mark Cuban autographed jersey is a red flag.
Sometimes, it is reviewed w/o you knowing and it is passed.
This is important if you ever had any problem w/ PayPal before.
They look at history.
All your items, all your transactions.
If you ever sold another Cuban item, this new infraction is number two.
You have as much chance of winning an appeal,
as hitting a multi-million dollar lottery.
Don't do it.
Don't count on your 'venue' to warn or protect you.
Don't think you can write to the Gov't
and get a letter from them saying your box is o.k.
It will not change PayPal's decision.
Once PayPal restricts you, it's almost always over.
They have your name, address, tax I.D./S.S.#, and I.P addresses.
If they detect you are using another person's account, they will assume it is you.
This goes for your customer, if he/she buys this kind of item.
It is not funny, not a game, not a made up joke.
If you want to sell on eBay, you need: PayPal or a Merchant Account.
Without PayPal, you lose those buyers who like or trust that service.
Being a seller is a serious job.
They do not care if you are:
Grandma selling her old items for her doctor co-pays.
Mom selling her old kids' toys for college funding.
If you are selling an item that is recalled, banned, or otherwise regulated, beware.
If you don't want to believe what I write, that's o.k.
I tried.

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

by: gramophone-georg This user has validated their user name.

Sat Sep 5 14:51:34 2015

Epuise: Goes right back to the one fundamental issue I've had with eBay/ PayPal from the beginning- that is that sure, companies have a right to dictate their business policies, but these two seem to be more incapable than most of JUST BEING UPFRONT about things.

Why can't they just tell people, for example, ''Don't sell anything having anything to do with Cuba and take PayPal for it or we'll close your account and freeze your money without warning''?

Instead they change their vague and extremely verbose yet meaningless wording in the night and then slam sellers for it... IT IS A GAME for these people... a game of ''because we're big corporate badazzes and we CAN- what are YOU going to do about it, pond scum?''

How an Empty Cigar Box Can Lead to a PayPal Nightm   How an Empty Cigar Box Can Lead to a PayPal Nightm

This user has validated their user name. by: iheartjacksparrow

Sat Sep 5 15:22:39 2015

@epuise - Did you get your PayPal account reinstated, or are you banned for life?

I would still like to know how a company with only a money transmitter license can dictate what people choose to sell.

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