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Paypal Is Down! The Evanescent Nature Of Your Money

Updated on July 19, 2008

It all started innocently enough. I wanted to send a small payment to a research subcontractor I use regularly. Usually all I do is log onto Paypal, click on their email address using the popup box, fill in the amount, send them a smiley in the message box and it's done. Magically the money pops out the other side and everyone is happy.

However, this time, the popup box was gone. The entire list of all the people I regularly pay through Paypal had vanished. Was this a new Paypal feature, perhaps to protect privacy... to keep the lists of email addresses from hackers... maybe, or maybe not. Regardless, I filled in the research subcontractor's email address manually, completed the transaction, and really didn't give it much thought.

The next day I had to send an invoice to a company that I've done some work for over the past few months. I invoice them regularly so I'd set up an invoice template. All I usually do is call up the invoice template, fill in the new amount and the details of the job completed and send it off.

That's where the Paypal train went off the rails.

When I selected the invoice template from the popup box and chose it to begin filling it out, I was taken to a Paypal page which said Click Here To Retry. And again. And again. And again. Lots of Click Here To Retry. No Invoice.

I tried a couple of hours later. And a couple of hours after that. Still Click Here To Retry... until you die.

I fired off a HELP letter to Paypal. They replied the next day with boilerplate:

I understand that you have a concern regarding difficulty using your invoicing tool as well as sending money. I sincerely apologize for the inconvenience this has caused you. Let me help you with your concern.

We are aware of this issue and I sincerely regret the inconvenience it has caused you. Our technicians are working to resolve this matter. We appreciate your patience and understanding.

The email went on to instruct me how to send an invoice through the Request Money tab... which of course gets me right back to Click Here To Retry... Click Here To Retry... Click Here To Retry...

Of course the friendly Paypal emailer informed me that:

This is the best resolution that I could offer you right now. We appreciate your patience and understanding regarding this matter, and wish you continued success on PayPal. Rest assured that we are committed to making your experiences at PayPal pleasant and rewarding.

I'm soooooooooooooo glad that this was the best resolution they could offer. A resolution of nothing which was pleasant and rewarding and which ensures my continued success.

If my bank had pulled something like this on me, I'd be down at the branch at nine am sharp to give the manager an earful, and possibly pull out all my money in cash to deal with one of their competitors. However, the money that I have at the Bank Of Paypal allows me no manager that I can meet with, and it certainly allows me no way of pulling my cash out. All it allows me to do is to Click Here To Retry.

What a bunch of foolish idiots we all are to trust our money to a global bank that is not only unchartered, but unregulated by any government anywhere. Paypal has our money and we don't, and whenever they choose by intent or by "technical problem" to deny us of our money we can display "patience and understanding"... while we Click Here To Retry.

Paypal is a gargantuan financial ticking time bomb. When it finally goes off it will devastate many more customers than a hundred IndyMacs. You don't have to look far to find online forums filled with irate Paypal customers who have already lost hundreds or even thousands of dollars to Paypal's "policies" and their only recourse is to Click Here To Retry.

Paypal cannot be allowed to continue in its current form. I have already shown in Time to break up the Paypal & Ebay Monopoly how the payment service has metamorphosed from a convenient way to pay for a $20 Ebay purchase to a gigantic unregulated bank which operates in virtually every country in the world, and which holds the key to the total household income of innumerable families. The United States and other governments around the world have to step in and protect countless millions of their citizens from the dangers of Click Here To Retry.

The United States Federal Deposit Insurance Corporation is the government agency which was set up at the height of the Great Depression in 1933 to provide to every depositor a firm, government-backed deposit insurance. This level of FDIC coverage guarantees any bank deposits in the United States for up to $100,000 per depositor. That is a guarantee which is legally assumed by the government of the United States of America. The FDIC has also set up the Fair Credit Billing Act (FCBA) and Electronic Fund Transfers Act (EFTA) which apply to any bank transaction in the United States. The FCBA is set up to apply to "open end" credit accounts, along the lines of credit cards or revolving charge accounts that are found on department store cards. The EFTA is set up by the FDIC to regulate the transactions of electronic fund transfers through automated teller machines (ATMs) or debit cards along with any other point-of-sale debit transactions. The FDIC is very specific in that EFTA also applies to any other electronic banking transactions, and I quote: "...that can result in the withdrawal of cash from your bank account".

However, in the case of Paypal, where is my government's banking regulatory policies set up to protect me and my money? Where is my FDIC or similar government guarantee of deposit? Where is the FCBA and EFTA? Where is the transparent accountability? Where is the interest payment on my deposit balance? Heck... where's my deposit balance? Where's my cash?

Only Paypal knows. And all they're saying is: Click Here To Retry... Click Here To Retry... Click Here To Retry...



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    • profile image

      David 5 years ago

      No, PayPal should not be regulated. It should certainly be subject to sanctions if and when it steals your money or violates any contractual obligation with you. You should be self-responsible enough to make a judgment about whether to accept the attendant risks of using PayPal for the sake of the convenience of using it. If you decide it's not worth the risks, instead of calling in bureaucrats to mandate that PayPal be regulated "just like banks," why not simply decline to use PayPal?

    • Hal Licino profile image

      Hal Licino 9 years ago from Toronto

      That's a wise policy!

    • Lissie profile image

      Elisabeth Sowerbutts 9 years ago from New Zealand

      I have a policy of always withdrawing fund as soon as they reach the limit for free payment

    • Hal Licino profile image

      Hal Licino 9 years ago from Toronto

      Sounds good. Always be vigilant. That will definitely diminish the chances you'll get taken for a ride!

    • donotfear profile image

      donotfear 9 years ago from The Boondocks

      I haven't had any problems with Paypal. In fact, I find it quite convenient. I don't buy or sell any more than 5.00 to 100.00 at one time. I didn't have any trouble getting Paypal to pay me direct to my checking account, either. I'll certainly be on the lookout, though, and check my account often for any unauthorized withdrawals from my checking account, etc.

    • Hal Licino profile image

      Hal Licino 9 years ago from Toronto

      Jeanette M... keep in mind that Paypal can act in the following manner: You take your chickens to the grocery store to trade for broccoli, and they take your chickens, don't give you any broccoli or anything else, and kick you out the door. :)

      Karen N: Paypal seems to stop at nothing to disappoint its customers. It is a very curious policy for such a major player in the client-centered financial arena.

    • Karen N profile image

      Karen N 9 years ago from United States

      Paypal can be a huge pain to deal with!

    • profile image

      Jeanette M 9 years ago

      Ah for the simpler days when we all bartered and traded for goods and services...sigh. Wait a moment! Can you imagine taking your chickens to the grocery store to trade for broccoli? Scratch that idea

    • Hal Licino profile image

      Hal Licino 9 years ago from Toronto

      Thanks to starcatchinfo; esocial; DonnaCSmith; Rochelle Frank; dafla; for the kind words and agreeing with me that Paypal is a monster that has to be herded in before it's too late.

      Garry_Woods: The basic difference is that if your bank manager decided one day to rip a grand out of your account, you have banking regulatory channels to be able to pursue the action and get your money back. If Paypal does the same, you don't have a hope in hell.

      koncling: A Paypal account is not bad. However, you should be very careful as the slightest unintentional violation of their terms could see any cash you have in there suddenly vanish.

      Kyle MacRannell: Yes it is a good point, but how am I as a Canadian (or even a New Yorker or Floridian) supposed to be able to launch a small claims action in California court? Usually small claims court requires physical presence at the hearing and the costs of taking time off work, flying out, hotels, etc. could be much higher than the amount being sued for!

    • koncling profile image

      koncling 9 years ago from Nice Winding Room

      Well I don't have Pay pal Account....yet

      is it bad..?

    • DonnaCSmith profile image

      Donna Campbell Smith 9 years ago from Central North Carolina

      My money doesn't stay in Paypal or my bank account long enough for them to steal it. I do my own dissappearing act.

    • Garry_Woods profile image

      Garry_Woods 9 years ago from Penguin

      Hey guys nothing is safe any more not even your Kids, look how many go missing every year, poor little people they can't help them selves.

      So what about Pay Pal they have been crook for years same as a lot of Banks high interest rates, no different, its a sign of the times.

      Even petrol prices around the globe, every thing is going haywire, meaning crazy, just pays to have only a small amount in your Paypal account:

      I learnt a long time ago, not to trust any banking place where they have control of my funds, no way if I don't have Control of my Money No else will either. just take care guys, walk softly, don't make a noice shhhhhhhhhhhhhh

    • profile image

      dafla 9 years ago

      I lost $250 with PayPal back before eBay even owned it. It just disappeared out of my account, and nobody knew where it went. I never did recover it, because I could not prove it was ever there. I learned from that experience to check my PayPal balance every day and print out the page every time it changed, plus email a copy to yourself, so you have a date and time stamp.

      The only reason I use PayPal now is that I have to to get paid for some of my online things. If I didn't have to use it, I wouldn't. I request a check frequently, and I will never give them my bank account info.

    • Rochelle Frank profile image

      Rochelle Frank 9 years ago from California Gold Country

      This is not good-- I know a lot of people use it as a necessary convenience. Aren't most eBay transactions handled this way? I, myself, have ten bucks in a paypal account, does this mean I've lost it?

      Seriously, this could be a big problem for some. Interesting information.

    • esocial profile image

      esocial 9 years ago from California

      Good hub, gusty. It's time all 3rd party financial programs were regulated. Hook your cart up with any intermediary and see who has the power over your money. It's scary out there!

    • starcatchinfo profile image

      starcatchinfo 9 years ago


    • Kyle MacRannell profile image

      Kyle MacRannell 9 years ago

      Sounds like a real horror story! However, ultimately Paypal, owned by Ebay is accountable to the California Dept. of Corporations as well as the CA Office of Comptroller of the Currency...In short, if you truly get no satisfaction from Paypal and really want your money back, you have full legal right to file a small claims action up to $5,000 + court costs to recover your cash! Typically, companies such as Ebay, when ecountered with this reality, or the possibility of a real class action suit, get motivated quickly to step up their service on a case by case basis...But, these are the risks in dealing with Paypal, a psuedo-banking institution, the regular rules often don't apply, so you have to use alternate channels...Bummer!

    • Hal Licino profile image

      Hal Licino 9 years ago from Toronto

      You're very welcome. Thank you for your comment!

    • xrated profile image

      xrated 9 years ago

      Thank you for sharing.

    • Hal Licino profile image

      Hal Licino 9 years ago from Toronto

      The governments of the world are letting Paypal run rampant. Most Paypal users assume that their money is safe in some way, when in fact it's just as safe as handing a big wad of bills to a total stranger! Might be trustworthy... or... might not be!

    • Babbyii profile image

      Barb Johnson 9 years ago from Alaska's Kenai Peninsula

      Like you said before, where is BIG Brother when you need him?

    • Hal Licino profile image

      Hal Licino 9 years ago from Toronto

      Apparently it's a system wide fault so I'm hardly the only one who is being messed around with. But I've been wary of Paypal for many years. I know a guy who had $600 flagged in his account as suspicious activity. Paypal took it, but they never got around to giving it back to him OR to the person who paid it to him. They just kept it. Nice, huh?

    • Babbyii profile image

      Barb Johnson 9 years ago from Alaska's Kenai Peninsula

      Had a paypal day like that once. Hope things get straightened out before more invoice calamity and confusion occurs, not to mention your wasted time.

    • Hal Licino profile image

      Hal Licino 9 years ago from Toronto

      Check out Darkside's superb Hub tutorial on Darkside is The Man when it comes to Hub mechanics! :)

    • hot dorkage profile image

      hot dorkage 9 years ago from Oregon, USA

      how do you get your photograph capsules to be inside your text capsules? I havent figured out yet.