PayPal Warning

[MistressValerie1]

Is the Taliban now running PayPal? It almost seems like it, as this security-lax, customer-unfriendly "service" has just gotten a whole lot worse.

Reuters reported today that effective 24 September, PayPal will deduct "fines" of up to $500 from customers who use their accounts for online gaming, purchasing legal adult content, or buying legal pharmaceuticals from legal pharmacies that don't meet PayPal's criteria.

According to Yahoo News, Eric Jackson, a former PayPal executive and author of the new book "The PayPal Wars," calls the new policy "draconian" and said it was likely a two-fold strategy to discourage certain behavior while heading off regulators.

"I can only surmise that PayPal is coming under increasing regulatory pressure and has no choice at this point but to take an aggressive posture," Jackson said. "I think they're making an emphatic statement that they're making a clean break from gambling in particular."

I recommend that all PayPal users close their accounts as soon as possible, as I did earlier this year. See http://www.paypalsucks.com for true PayPal horror stories from customers and vendors as well as information about the recent class-action lawsuit that PayPal had to settle.

More at http://story.news.yahoo.com/news?tmpl=story&cid=582&e=3&u=/nm/20040910/wr_nm/tech_ebay_fines_dc

 

[nessonite1]

Missy Val,
Hubby and I were just talking tonight about reactivating our ebay account and using PayPal as a way to save our money since we can't get a bank account (long story). I remember saying actually "We'd have to look at PayPal's site since they change their policies every 5 minutes".
Who was it...umm...The laugher's site I THINK was banned from PayPal because he used their ordering system for what they viewed were "adult" videos...even though his vids are NOT adult or even mildly suggestive. I dont know if I ever heard if he wonhis argument with them or not.
I'm afraid I'm not going to jump on the "boycot PayPal' bandwagon though. It's just too convenient as a means of accepting ebay payments. Hardly anyone will buy from you if you don't take credit card orders in some fashion. 🙁
I WILL check out the link you supplied though. Thanks as always for keweping us up to date on the stupid state of things!

 

[Celtic_Emperor]

Well now this sucks major nards! I was thinking of using PayPal for comissions I recieve. But if I can expect this kind of bias flim-flamming, I'm not so sure. Its a shame, as it appears PayPal is one of the leading forms of online currency exchange.

 

[nessonite1]

Im sorry Missy Val for the first time I think I'm gonna have to disagree with something you put up. 😛
I read through someof that guy's site and listened to his 25 minute call with PayPal and have to say it looks like a pretty clear case of someone not reading the TOS they were agreeing to.
I don't think I'm going to stop using PayPal for eBay but I WILL make sure I dont do anything that would come close to offending their super-sensitive TOS.

 

[Faramir]

John Ashcroft is watching YOU....!!

(*insert Nazi helmet/swastika here*)

 

[MistressValerie1]

Sadly, Stormy, you're 100% correct 🙁

Ashcroft claimed that the Internet is a tool FOR CHILDREN:

"The Internet is perhaps the most pernicious medium for obscenity. The Internet is a double edged sword: on one hand, it is an amazing tool that provides children a wealth of educational resources and gives them access to cultures and ideas that are beyond their everyday experiences. On the other hand, it also serves as a conduit for child exploitation and obscenity that respects no boundaries and recognizes no jurisdictional lines."

http://www.nationallawcenter.org/Remarks of Attorney General John Ashcroft.htm

This wasn't in the context of an education conference, but an obscenity prosecutors' conference!

Love to all,

 

[The Last Laugh]

Who was it...umm...The laugher's site I THINK was banned from PayPal because he used their ordering system for what they viewed were "adult" videos...even though his vids are NOT adult or even mildly suggestive. I dont know if I ever heard if he wonhis argument with them or not.

Actually it's possible it's me you're referring to, though I'm not the only one who had problems recently. Maybe it did happen to The Laugher as well, I don't know.

You're right, PayPal dumped me because they figured my videos were inappropriate. Ridiculous, of course. But to be fair, I kind of understand PayPal. VISA doesn't want to deal with "adult" sites because they're considered a higher fraud risk than other sites, even though this is obviously over-generalizing and they're punishing the majority of sites that are totally harmless. EBay has to do the same because otherwise they'd lose VISA, I assume. And PayPal is owned by eBay, so they have to do the same too.

But even though I can knd of understand why PayPal is doing this, I have a big problem with the execution. No warning, no answers to my questions, and no way to get my money back for 180 days (if I even get it back at all). PayPal's policies are terrible. Very unfair.

As for winning my argument, I never had the slightest chance. They don't bother to use their common sense and judge each site in an objective way. It doesn't matter if I have plenty of perfectly valid arguments to defend my case. If a site has anything to do with adult stuff, no matter how mild, they drop it. They're just not taking any chances. The way I see it, even if a person in charge of investigating a site finds it harmless, he/she doesn't really have a choice but to close the account anyway. They have rules to follow to the letter. It's their job, after all. Personal opinions don't matter.

I never even got an answer to my requests for more details about why I was shut down. Heh, as if they cared. Not only must I permamently give up PayPal for my credit card transactions, I also won't be able to use PayPal at all for my personal purchases for at least 5 more months. Basically, I've been banned from PayPal for a total of 180 days. I'd need a second bank account and credit card to get a new PayPal account, and I don't have either.

Now, as lousy as PayPal is with seller members, they're not quite as bad with buyers (though I'm sure many have had bad experiences). I have to hand it to them, their system (if not their service) is top-notch. It's a very convenient and popular payment method, and I suppose that for non-adult transactions it's one of the best options out there. It's really too bad about the constantly changing, unfair policies. Otherwise PayPal would be great.

 

[nessonite1]

That's pretty much the impression I have gotten, Francois. I'm pretty certain it was the Laugher and not you I was talking about though I could be wrong.
Basically they're covering their asses. It's their right to do it so even if I don't agree with their interperetation of the word "adult" it's really not my call. I'd apreciate it if they treated people they "banned" with a little more courtesy and at least offered an explanation but you can't really say someone is the evil scumof the earth for not providing good customer servise.
I've used them a ton of times and never had a problem with them.

 

[Kalamos]

Possible workaround: would it be feasible to create a "clean" facade site, to accept payment for an adult product?

Example: an artist gets a commission for an adult picture. He/she wants to use paypal but he/she don't want them to know the reason/source for the payment.

So, he/she create a facade site with his/her clean pictures, and puts a paypal link. Finally he/she creates a one-way link from his/her adult site to the clean site through a forwarder.

Would they be able to track down the service for the payment?
Would it be a fraud?
Would it get such an artist into troubles?

Reg's.

 

[The Last Laugh]

Possible workaround: would it be feasible to create a "clean" facade site, to accept payment for an adult product?

Example: an artist gets a commission for an adult picture. He/she wants to use paypal but he/she don't want them to know the reason/source for the payment.

So, he/she create a facade site with his/her clean pictures, and puts a paypal link. Finally he/she creates a one-way link from his/her adult site to the clean site through a forwarder.

Would they be able to track down the service for the payment?
Would it be a fraud?
Would it get such an artist into troubles?

Reg's.

I've no idea if they could spot it, but I'd rather not bother. Just not worth the risk. I mean, if they could somehow find out about the trick, then in the best case scenario I'd still find myself having to find another payment system after being banned without warning, forced to find an alternative while losing sales until I do. At the worst, it might actually be fraud, thus illegal, even though I think it would be fair of me to do so. Better get a safe, perfectly legal system right from the start.

Actually, I kinda considered opening a new account and posting on the forums to ask the customers to use the "Send Money" option of PayPal instead of having them use shopping cart buttons as usual. Then there wouldn't be any mention of PayPal on the site and it would be just like a person sending money to a friend. Nothing illegal about a personal transaction, right?

But there are problems. First, the customer has to know how to do it and he/she must know the exact total cost. I get the feeling some people would get the shipping fee wrong. Second, a customer would also have to send a separate email for the order details. It may not seem like much, but it's an extra hassle for the customer, and people can forget to include important bits of info. The process would be a bit clunky. Third, until the period of 180 days is over I'm basically banned from PayPal, at least using the same bank account and credit card. So I can't even open a new account and thus can't use PayPal at all.

 

[TickleTheater]

Yeah, it's a shame how cruddy their service has become. Unfortunately, people still use it so it's a necessary evil. In order to do some business I needed a new account so I started from scratch.

New bank account, different name, new domain registered through proxy, different IP address, so essentially completely cut off and unrelated from my past account. No problems, no worries, and no hassles.

Just have to make sure that when the person signs up for a service you name it something else, and most people know to do it by now since it's their account on the line too b/c it's against their TOS to accept or pay for any adult related services. 😉

 

[Celtic_Emperor]

I'm not so sure now. I'd almost rather accept checks or money orders, or even cash to my address. Sure, it discloses my address, but I don't have to work through someone, and its more discrete, since they get their material online, rather than a hard, carbon copy of the original (which I insist on keeping). And me, I don't have to worry about it, because I just get the money without having to sign anything, and since I'm not a business I don't have to worry about what label or title I work under or what I call my work. In fact, I don't even draw adult material or erotica, so I'm extra protected in that sense.

I can see the convienience in using systems like PayPal though, even with these troubles.

 

[nessonite1]

Totally true, Vlad. I'd MUCH rather get checks, MO's, even cash. But fromthe cutomer's point of view using a credit or debit card or echeck through PayPal is so much easier. So when selling on ebay (or through a traditional storefront site) it's almost suicide not to use PayPal (or a merchant account if you can get one. I cant cause my credit blows)
I know when I'm shopping online or on ebay, unless I have no other option but to buy from a particular person, I will never buy from someone who does not accept paypal or something similar. It's just a hassle to go to the post office or WalMart just for money orders.
Kalamos...it certainly could be a work around to make a 'clean' site to accept payments on. I'm sure if PayPal ever foundout about it they'd spank your account but nomore than if you had been more obvious about it. You'd have to be damn certain they couldnt find out. Or a better option would be to have people send you the money directly to your email address and never went through shopping cart buttons, as Francois mentioned. A bit more work but if you really need to use PayPal then it's an option at least.
In any case when using PayPal it's a good idea to get the money out of your account often and, if possible, move it to a bank account not asscociated with PayPal. If they do freeze your account they can, per the user agreement, reverse any recently made withdrawls and keep your money for 180 days as their "in case someone wants their money back" clause dictates.

 

[Celtic_Emperor]

I guess it boils down to the level of need and the level of output. For example, us artists who may only do a few comissions, say, a month really have no need for PayPal.

Or, if are customers are the same people requesting of us, generally speaking, then this is another reason PayPal may be unnecessary.

It seems that for large scale operations services such as PayPal are ideal, but when you really sit back and look at your monthly output, it may not be worth the risk of dealing with a company, which apparently, as this update suggests, is on the flip-flop.

 

[HOLLYWOOD]

As a consumer the almighty hollywood brother likes to use paypal. The hollywood brother doubts that it is much safer but when the hollywood brother is on www.ebay.com and do not know who is he doing business with, the safety of paypal is comforting. What the hollywood brother does not like is that less and less people with tickling material are taking paypal online now. There have been numeorus items that the hollywood brother was interested in but did not purchase do to lack of paypal.

Perhaps a solution is for another company to make a version of paypal that has no problem with adult material. While the hollywood brother can agree that the interent is for children, it is also for tickle phantaics like the hollywood brother as well. Perhaps if there was a paypal like service that had the Balls to do adult stuff, they could make billions and billions of dollars.

Now on a final hollywood brother note, the hollywood brother will continue for the time being to use www.paypal.com only because the legendary hollywood brother can instantly pay for products which translates to them getting shipped to the hollywood brother a little bit faster.

 

[nessonite1]

A good idea, HB. As I understand it Paypal doesnt allow adult stuff because they accept Visa, who generally doesnt like adult stuff being peddled in conjunction with their name. It would be quite simple to open a similar service that acceps, say, only Mastercard, so people with more adult material to sell could do so without an expensive and hatrd to get merchant account.
Pardon me if me typing sucks. I just got a new keyboard and it's a bit different from my old one 😛

 

[The Last Laugh]

Perhaps a solution is for another company to make a version of paypal that has no problem with adult material. While the hollywood brother can agree that the interent is for children, it is also for tickle phantaics like the hollywood brother as well. Perhaps if there was a paypal like service that had the Balls to do adult stuff, they could make billions and billions of dollars.

On paper it does seem like a very good idea. You'd think a company would jump at the opportunity to get a lot of business to their services, including adult businesses. However, I doubt that the reason no significant company has appeared yet is that no one has thought about it or just haven't got to doing it. I think that, business-wise, it's probably more risky than it seems.

See, I don't think that VISA's (and eBay'S and PayPal's) main reason for not wanting adult vendors or products has much to do with decency, protecting the children or whatever. More likely it has something to do with profits. As I understand it, the adult material market tends to involve more fraud overall (I'm not talking about us tickling videos producers, of course), which leads to a significant loss of money for VISA. Now, I find it kinda hard to grasp how dropping all those vendors and losing their business is actually more profitable than biting the bullet and accepting a certain level of fraud from a few unscrupulous vendors and customers, but I guess the VISA people know what they're doing. And if the VISA/eBay/PayPal people feel that getting around this just isn't worth it, I suppose not many other companies would want to give it a try.

To be fair, I can't totally blame VISA for this. Again, they probably have good reasons. But I really hate how this is enforced, especially by PayPal. I mean, this rejection of "adult" businesses is just too generalized. Anyone who has anything to do with adult stuff, no matter how incredibly mild, is cut off. Everyone is dumped in the same category. No case by case sorting to determine whether a website is clean enough to be acceptable or at least not a significant fraud risk. I'm sure the large majority of adult sites are perfectly legit, with no problems whatsoever. My own business certainly isn't a risk to anyone. But we all get punished anyway. I guess it's just too much trouble to use common sense and analyze each case. They'd need a lot of resources to do that. Easier and cheaper to reject everyone without distinction. It kinda makes sense, but that doesn't means that it's fair. Neither is the lack of feedback from PayPal after one gets one's account closed without warning, nor is having one's funds frozen for 180 days. I've said it before and will say it again: from a technical point of view PayPal is a great service, with a very good system, but its policies totally suck.

By the way, I most certainly understand why you're still using PayPal. For most people, it certainly is a very convenient and, overall, reasonably safe method of payment. As a consumer, I'd still be using it if I hadn't been rejected and more or less banned from using PayPal. Heck, I my website had passed their inspection I'd still be using it for The Last Laugh. I don't see any major not to recommend it to people in general. But it's more risky for vendors, and adult vendors shouldn't touch it without a 60' stick and several pairs of thick rubber gloves. That's just begging to have one's business eventually crippled without warning.