$50,000.00 Hold because of a $9,000 dispute? Seriously?

[Martel]

Silver prices are up so I sold off 14 of my Engelhard bars. All have been delivered and everything is great.

I open up Ebay to see a message from one of the customers who bought 3 bars. He's claiming that 2 of them are fakes and wants to return them. He also advises he is filing a dispute for the two bars. I wrote him back and instructed him to return them for the full amount he paid. I told him I'll even cover the cost of the return mailing and insurance. It's the least I can do since the prices have gone up since I sold them, and I'd love to have them back.

He files a claim with PayPal anyway.

I understand he is looking to protect his investment, I really do - what kills me is that PayPal didn't just freeze the amount of the bars, no...they froze $50,000.00!!! The bars are only worth about 9,000 combined! They froze over 5 times the amount, and I have no idea why.

Any one have any idea as to why they would do this, and how long it's going to take to correct?

[tservers]

Firstly, as a silver investor myself, I know exactly how you feel.

The only thing that I can think of is that if a dispute is made against a person, the whole account balance is "held" until the matter is resolved. And you make absolutely sure that the person sends your silver right back. He/she don't know what they're missing out on.

Because of the amount of the transaction & the product of the transaction, I would not sleep until I have CONFIRMATION that my silver was on it's way back to me. I'd even do a Google street map/view, if available for the address as to where my silver was coming from. Silver is almost at it's all time high of $50.35 in Jan 1980. It's already $45.91 right now.

But, the only thing you can do at this point is just wait for your silver to get back to you, and then just refund his money.

The day the silver arrive, let PayPal know and letthem know you're giving a refund without any problems and they'll take their amount and release the funds back to you.

If you do it over the phone, you should be able to access your funds probably by the time you get off the phone. It may take a bit longer, but it'll be done quickly by PayPal.

[Martel]

I don't mind them holding the amount of the dispute, but I do mind them holding 50K for 9K in dispute.

That's insane! They didn't freeze my entire account. There's still plenty of money available - I just completely do not agree with the amounts involved. If someone disputes 20 bucks, do they freeze 105?  No they don't. I've been doing business with PayPal for years, and they always just freeze the amount of the claim. I'm going to call them to see what the deal is....if anyone actually answers.

[Martel]

So I called PayPal and someone actually answered. Couldn't help me, but they were nice.

Here's the email notification sent to me about this situation:

Dear **** *****,


During a recent review of your PayPal account the determination was made
to apply a reserve to the account as of date. A collateral amount of
$50,000.00 has been set aside from your current available balance.

The decision regarding your reserves setting was based on the review of
the risk exposure inherent to your account (1).  A risk review is the
evaluation of several factors related to an account, which include but
are not limited to transactional activity, customer disputes, type of
business, delivery and customer satisfaction time frames.  Reserves are
funds that belong to you, but are set aside to ensure your account can
cover transaction liabilities. You will be notified if your reserve
settings are adjusted in the future.

______________________________________________________________

So I wrote a letter. Took me about 15 minutes to compose. I sent it out and instantly got this in my email box:

We want to help you but we're not able to respond directly to emails
sent to this address.

One of the best ways to get answers to your questions is to go to the
PayPal website and visit the Help Center by clicking "Help" at the top
of the page.

If you have a problem with limited access to your account, you'll need
to:

1. Go to the PayPal website and log in to your PayPal account.
2. Click "Resolution Center" at the top of the page.
3. Follow the instructions in "Steps to Remove Limitations."

If you can't log in to your account, you'll need to:

1. Go to the PayPal website.
2. Click "Contact Us" at the bottom of any page.
3. Click "Contact Customer Service."
4. Click "Continue" and follow the instructions.

We value your business and want to provide you with the best customer
care.

Thanks,

PayPal

_______________________________________________________

What was I thinking??? Like anyone at PayPal wants to read an email about my problems they created...

[tservers]

Yeah, I just sent them another letter too because they have a hold on my funds too. My hold has been since April 1. I'm not happy at all about this. My customer have my products and NOW she has all her $3,700.00 back on her credit card.

I'm just trying to wait to get my money back into my account, but I'm also behind on my obligations too because of this.

Just hang in there, but in the meantime, create a way to protect your money by not keeping profits or any useable money in the account (money to pay for orders). I'm finding that out the hard way. After I get my payments for now on I'm just going to transfer it off the account, so that way IF/WHEN a dispute come up at least my money won't be locked in the account.

I know they have to protect themselves and I agree with procedures, but I don't agree with having to wait when you've submitted all proof needed to release your funds. This is a lesson I'm never going to forget and it just now taught me to NOT keep money in my PayPal account as long as I have orders being processed.

I sell products that take 6 - 8 weeks for delivery, and sometimes my product may not come out within that time frame. About 3 times per year at most. But, the time they dispute PayPal normally refuses their dispute because it's more than 45 days since the transaction. This time they did a reversal of what I thought they don't do.

This whole thing has been a nightmare for me, but I'm just moving on while I wait for my money to get back on my account, and in the meantime, I'm preparing for next steps if needed.

[Martel]

I have filed a complaint with Greg Abbott, Attorney General of Texas, Mary Ann Gonzales of the Texas Department of Banking and also contacted the law firm of Freed & Weiss LLC.

A BBB complaint may be filed soon as well.

I really hope this issue is cleared up. The actions by PayPal are disturbing. I Googled "PayPal reserve" and could not believe the number of  horror stories! Page after page after page... It seems to me that the moment you generate some form of revenue stream, someone finds a way to take it away from you.

[tservers]

Well, after getting off the phone today with a PayPal Dispute Specialist, I'm feeling much better because she took the time to verify the information I faxed AND emailed in to PayPal and she told me

"Ok... Kevin, I see it now... something has to be done about this immediately because you've verified the PROOF of SIGNED DELIVERY. We'll have to get your money back to you as soon as we can and we'll (PayPal) have to go after the customer's credit card company"

That's what I'm talking about. I've been without my expense money for nearly 30 days now and I'm behind on many of my bills too.

I'm sure they'll release your funds soon. Just hang in there and stay on top of it, like I've been doing. Don't sleep if you don't have to. This has really taught me a valuable lesson for sure that I'll never forget.

On another note: I'd love to talk to you about some products.

[Martel]

Update:

The buyer closed the case - PayPal still holding 50 grand.