Problems with Paypal

By | June 2, 2012

Yes, I’m having a disagreement with Paypal. People have warned me for years that Paypal didn’t allow sales of adult products. But I’ve been using them as my payment processor for over 10 years. I considered my business to be “grandfathered in” because I signed up before they implemented the ‘no adult product’ policy.

In fact when I called their support line today, the Paypal rep verified that they had reviewed my web site and products several times over the past few years and never had a problem. He didn’t understand why they would suddenly change their mind, but he had to send the issue to a different department for resolution.

The timing was also quite malicious. I typically withdraw most of my funds the first week of the month (to pay rent and other bills).  They froze my account just a few hours before I made this month’s withdrawal. 

So sales of my mp3 files are temporarily suspended. Hopefully this will be resolved on Monday. If not, I’ll have to contact a lawyer about taking legal action against them. I think that Paypal’s practice of suspending accounts and withholding money for 6 months may be a violation of the Hobbs Act 18 U.S.C. (interference with interstate commerce by extortion). After all they have essentially shut down my business.