I've had exactly the same problem. I even tried providing my online bank account login to help expidite the "verification" process, but was still rejected. I also tried to verify by phone, but was told by a recording that my phone number didn't match my records. It's ridiculous.
It's interesting that PayPal advises you to "Never share your PayPal password", but doesn't hesitate to require all sorts of confidential information from acount holder, only to make a simple credit card transaction. If I could get a human on the phone instead of a recording, I'd cancel my account and request all my information be deleted. Even though the account is useless at this point. This is a terrible company with zero customer service.
