PayPal have my money and won't give it back!

  rmcqua 19:05 26 Feb 2006

A few weeks ago I contributed to a thread regarding some of the difficulties encountered with EBay and PayPal. My little saga has now reached the stage where I thought it might be worth a thread of its own, so here goes:

I lived in the USA for 4 years and, during that time, had a PayPal account that I used regularly. It was linked to a credit card and current account that I had with Fleet Bank (now part of BankAmerica).
When I moved back to the UK I retained my old EBay i/d but of course had to change my credit card and current account details. My current account was (and still is) with Citibank, a major international bank.
After a while I had made a few sales and, having about Stg.200 in my account, wished to withdraw it. Now comes the nasty bit. PayPal would not let me use MY funds either to pay for an auction item OR to transfer to the bank account I had lodged with them until I completed their "extended verification process" (they had imposed a zero spending and zero withdrawal limit on my account.) This involves them placing a deposit in your (my) bank account together with a reference number, which then gets referred back to them to complete the process. Unfortunately, my bank, for some reason, do not participate in this automatic deposit system. I don't know why and I don't really care. "No problem", I thought, "all I want to do is withdraw my own money - I don't need to use PayPal again". I then started a series of exchanges of e-mail with PayPal, asking quite simply that they either send me a cheque for my balance, or transfer it to my bank account (details of which are already lodged with them).
I am now on my 9th. rexchange of e-mails with PayPal.
Every reply I get comes from a different person (seriously, 9 different customer agents).
Most of the replies clearly show that the agent has not read or not understood my problem. I have tried to keep it simple. One agent even wrote back "I note that you do NOT want to withdraw your funds"!
Several agents have told me that I can do nothing without completing the extended verification process, and I have patiently explained that I am unable to do that.
There is absolutely no continuity between their replies whatsoever.
I have referred them to my previous history of about 300 satisfactory transactions but, no, they can't take account of that.
Several of the replies have suggested that I change my bank, to which my response is that I have no wish to as I have a long standing, totally satisfactory relationship with them in all other respects, and all my salary, direct debit, etc. arrangements are set up via them.
Yesterday I 'phoned PayPal and spoke to a very nice lady agent, who was unable to help, claimed she understood my frustration and would take the matter to her superiors. I am waiting for a reply.
All I want is my rightful funds returned to me!
If anyone has any bright ideas as to how I might get some satisfaction from PayPal, I would be grfateful to hear from them. Otherwise I hope you enjoyed the story and I will keep posting any progress (or lack of it). Meanwhile, PayPal get my vote for the worst customer service I have experienced in a long time.

  Forum Editor 19:27 26 Feb 2006

there are two sides to all this.

Paypal are bound by UK finance laws, one of which insists that they verify all bank accounts into which fund transfers are to be made. This is to ensure that the account is bona-fide,and that people are who they say they are. The small deposit they make is transfered back, thus confirming that the account is active,and held in the name you provided. They have no choice but to make this verification check if they are to sustain trust in their userbase, and as they have literally millions of accounts the system has to be almost entirely automated in order to work efficiently. the checks are not just a UK thing - all US accounts need to be verified in the same way.

Quite why your bank doesn't want to play ball is beyond me, and I strongly recommend that you take it up with them. You may well say that you don't really care, but it might be the shortest way to get from A to B if you could persuade them to accept the deposit.

  rmcqua 19:46 26 Feb 2006

Thanks FE.
I will take your advice and try to get Citibank to explain why they will not play ball, but I'm not hopeful of being able to change their policy. The simplest thing all round would be for PayPal just to send me a cheque; then they would be free of me and I of them. I think my frustration would have been less had their customer service agents shown at least some attempt to understand my problem and help me resolve it. I'll post back with Citibank's reply.

  Forum Editor 19:52 26 Feb 2006

but PayPal probably have a hundred similar situations every day, and I suppose it's easy for them to come over as a bit uncaring.

I can't help thinking that your bank may be an easier option - let's hope so, anyway.

  spuds 22:31 26 Feb 2006

rmcqua- I think that you may have a misunderstanding in the way PayPal do the verification process.Paypal place a certain amount of money in your bank and/or credit card account. The amount can be anything from 1pence to £1.00. It is then your responsibility, to check your bank and/or credit card account or statements for the amounts PayPal have paid to you.You then notify PayPal of the amounts in your accounts.Simple instructions are given on how to notify PayPal. The money is non-returnable, as PayPal have gifted this to you. If things check out, then you are verified, due to the fact that you have confirmed that you had access to the accounts given in your name.

Verification can take anything from 3 to 10 days for PayPal to pay the 'direct debit' payment into your account's. The rest is up to you, and not a banks 'automated' system.Keep checking your account's.

When you email or telephone PayPal, the type of response you have received is normal, very confusing but quite normal practice.

I have had a number of dealings with PayPal, and I now use a method of direct contact with a specialist department in Dublin.

  Forum Editor 00:10 27 Feb 2006

As an interesting aside.........

When my payPal account was verified there was no contact between them and me at all - it all happened without my knowing it had, so to speak. I certainly did not have to notify PayPal about anything in connection with a deposit, yet my account was duly verified.

  SG Atlantis® 06:27 27 Feb 2006

Mine was verified like spuds described. They lodged a penny and later 3 pence into my account. I later logged on and had to enter these amounts to verify it was my account.

Same thing verifying my telephone, an automated machine rang me from paypal gave me a code that I had to enter into the site too.

The FE is right take it up with the bank, but have you tried the verification process to see if it goes through, despite what the bank says?

  rmcqua 07:35 27 Feb 2006

Thanks spuds and SG..
I do understand the process, perhaps I didn't word it too well. I used to have a verified account when I lived in the USA, and it worked in just the same way.
What happens now (or rather doesn't happen) is that the two small credits just never materialise in my account. I have tried several times and given them several days, but they just don't appear.
I currently have a query lodged with Citibank and we'll see what comes of that. My real irritation stems from the fact that they have Stg. 200 of mine, for which I could find several very good uses, and the really awful customer service (in fact, until my phone call, the previous 9 rounds of correspondence had produced no service whatsoever).
Thanks for the input guys, I will let you know how I get on.


  spuds 11:42 27 Feb 2006

I thought it strange considering that you already had an account in America, and you would have perhaps gone through a verification process previously. The money sent by PayPal is a straight forward banking direct debit procedure, so Citibank should have no problems with this method. As you state, something is strange, which requires clarification by Citibank.

Regarding your £200.00, PayPal will hold onto that until their procedures are complied with. Since the money laundering act came into being, things like banking have come under tighter restrictions, and PayPal have to be squeaky clean in this respect. Doesn't help you much at the moment, but that's the way it is.

I know of two people who have had the account 'frozen' recently. Not through the verification procedures, but through dispute problems.They are absolutely livid with PayPal, and like you, common sense via communications is a serious problem, which requires urgent management attention.

FE- The way SG Atlantis confirms, is the normal procedure used by PayPal. What happened in your case seems a little strange, as to the way PayPal normally do things!.

  Pamy 12:34 27 Feb 2006

My account was verified too like spud described, but when I tried to transfer money from my PayPal account to my bank account the transaction did not happen and I was charged £20 (Paypal took the amount from my account with them).This was because the account I wanted to transfer it too, did not support Direct Debit. As I did not have any other account to use, I slowley emptied the PayPal account by further puchases (I only now have just over £2 in it)

I know this story do not help you but I thought you and others might be intersted and aware of problems

  rmcqua 14:07 27 Feb 2006

Thanks Pamy,
If PayPal would let me use MY money to make purchases, I would be reasonably happy to do as you did.

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