I am a licensed mortgage broker, a former finance officer for the largest automotive group in the United States, and also an international import-export financial instrument negotiator.
In other words, I've been involved in banking and finance for a very long time.
I am aware of the policty being used by PayPal to hold the funds from its users for 21 days. It is my opinion (and the opinion of many others) that this e-Bay policy is unfair to consumers.
Here is how it needs to be confronted and challenged:
1. Copy down the mailing addresses I've listed below. Even though we live in the world of email, official correspondence still happens by official snail mail. For every letter you mail out, make sure you send it by REGISTERED MAIL, or official courier (i.e., FedEx, DHL, UPS, etc.).
2. Write out a clear, simple, easy-to-read complaint. Make several copies of it (at least 4 copies). Explain that you feel this practice is unfair. Just type it out, print it in quadruplicate (4 copies). Explain that you will be investigating the possibility of joining a class action lawsuit and pursuing every legal avenue available to you, if PayPal doesn't remove this 21 day hold policy. At this point, it must become a matter of principle.
3. Send a copy of the letter to PayPal, and then enclose a copy of the letter to
Obviously, when you send the letter to the FTC and to your State Attorney General and the Federal Attorney General's office, you will have to put a cover letter over it explaining what it is. Ask the FTC to look into it, and that you want to file a formal complaint over it. Ask the attorney General to do the same.
It takes a little work, but if you really want to change something in this world, it takes a little effort. This is something that is within your power, but power is useless unless it is exercised and used.
4. Make sure you demand in all your letters that PayPal and -e-Bay rescind their 21 day hold policies which is unfair to consumers.
If you do this, and others do the same (as I am doing) PayPal will likely find a solution to this problem. They are a business, and they want to have happy customers. They will change what they need to, if that is the only way to satisfy us.
For those who are exchanging official correspondence with PayPal, here below is the contact address:
Attention: Legal Department
P.O. Box 2211 North 1st Street
San Jose California 95036.
United States Attorney General's Office:
Attention: Attorney General
U.S. Department of Justice
950 Pennsylvania Avenue,NW
Washington, DC 20530-0001
Federal Trade Commission mailing address concerning unfair business practices:
Federal Trade Commission
Consumer Response Center
600 Pennsylvania Avenue, NW
Washington, DC 20580
Here is a sample letter:
I am writing this letter to formally complain about your unfair practice of holding funds for 21 days after an eBay transaction.
This unfair practice appears to be a hidden charge against customers. First you charge us for using your services (eBay and PayPal working together charge for all transactions.) Then the consumer is charged again, in the form of holding the funds. While you hold the funds, we are not compensated for the use of that money.
Obviously, holding funds for 5 million+ customers worldwide- at US$300, $400, $500 or more PER CUSTOMER is a substantial amount of money- but customers are not being made aware of such things.
Besides the unfair nature of this practice, holding a seller's funds also can make it difficult for a seller to do business- especially smaller businesses that require cash flow in order to pay for shipping and packaging.
As a customer, I demand that PayPal rescind its unfair business practice of holding funds for 21 days from its seller. This is improper, and deceptive in its implementation, and seeks to escape scrutiny by the State Banking Commission and other oversight agencies.
A copy of this complaint will be forwarded to the United States Attorney General and the Federal Trade Commission.
Thank you for your soonest reply.