How Paypal tried to Kill 855numbers.com
Yes, Paypal did their absolute best to kill our business. I suppose they probably weren’t trying to, but they honestly couldn’t have done any more damage to us if they had been trying. Right out of the box they made it almost impossible to work with them, because their system literally didn’t work the way it says it does on the website and the documentation. Their higher level techs admitted that they knew it didn’t but didn’t seem to care.
When we launched things definitely went from bad to worse. Their system caused issues with multiple orders and didn’t track the orders properly and left us with a over a thousand orders that had to be reconciled manually. We upgraded to a different system that we could control more at the paypal reps suggestion only to find that a few days into it, some stupid accountant in their risk depart read a totally fake attack article on a scam website. It’s clearly a scam website for a government related organization about toll free service that doesn’t exist and only goes back to a fake address in the Netherlands. It’s clearly a scam site with the phone number 800-000-0000 etc and no names of any kind. Yet Rochelle didn’t look at the source at all and shut us down completely without any notice or so much as an email, which is apparently what they do in some cases to scam websites. She didn’t contact their account rep or research anything she just shut us off cold because of her own mistake.
Rochelle clearly just made a mistake, but even after she realized she had made a mistake she didn’t try to fix it but instead tried to cover it up by making other excuses. We had a conference call in which they didn’t want to talk about the site that they had based their decision to shut us off on, but instead tried to claim they had done it because we were suddenly a “risk”. Never mind that they don’t shut down sites that are a risk, especially without ay notice, they just limit them so they can’t take out their money. They seemed like they were trying to get rid of us on the call by insisting that we might have to hold 100% of the funds, which is clearly way beyond even the worst possible scenario.
When they realized we had a successful million dollar business, and our sales were all to past customers, they asked for some documentation of our chargeback history. It took some effort but we produced a list of all 29 chargebacks we’ve had in the past 12 months and 9000+ customers. That’s exactly 1/3 of a percent, which is excellent. When we were on the conference call, they also agreed to reduce the restriction on our account so we could accept payments because we clearly weren’t a scam but they were just concerned about risk, however they never did that either.
They claimed they were going to review our chargebacks but several days later, we finally got a call from the same person who had made the initial mistake because of the scam website article, and she simply said that they were shutting us down permanently and keeping our funds indefinitely. Rochelle also said there was no review or appeal process and just said to “call customer service.” She clearly wasn’t concerned in the slightest about anything but getting rid of us to cover up her own stupid mistake.
Rochelle clearly made a mistake, but her attempt to cover up her mistake by blaming us and making the mistake permanent cost them a good customer. How she did it, turned a good customer into a evangelical PR company aimed at telling as many as possible of the new businesses using their existing website, to avoid Paypal like the plague! We’ve put this warning on every page of our website and are posting about it on all of the anti-paypal sites, of which there are a lot! I’ve closed my personal paypal account and won’t use ebay any more either, which I used to enjoy. Every word of this is the truth and isn’t even embellished in the slightest.
Paypal literally did everything they possibly could to destroy our 855 numbers service. Seizing our money indefinitely without a single complaint or issue is Stealing. Paypal literally caused so many customer complaints and incalculable lost business, and endless extra work that I wanted to just walk away from the whole business. The only reason I’m not is because I care about the customers that have put their faith in me. But this paypal horror story will be featured prominently on our website for years to come and be exposed to tens of thousands of potential prospects for paypal.
(5 votes, average: 5.00 out of 5)
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Bill Quimby (678 comments.) says:
July 23, 2010 at 12:13 am
This was an email from our programming company to the Paypal representative that I thought explained the situation well as well.
Bill is not a programmer, we ARE! We’ve been doing this for 25 years. We belong to every major developer community on the ‘net. We belong to every social network on the ‘net. And what was done to Bill is inexcusable. First, PayPal’s Web Payment Standard, did not work as promised by its documentation, dated May 2010. We wasted days trying to get it to work, only to find out that PayPal’s technical staff acknowledged that it doesn’t work. So, at our cost, we quickly applied for and switched to the Pro version. We worked nights and weekends to roll out the site ASAP. And then, after all this exhausting work, instead of celebrating the site’s success, we discovered to our horror that the site “wasn’t accepting payment”. One person at PayPal suspected that perhaps the site was a scam. But instead of temporarily freezing its assets and finding out more from the site’s owner, one person was able to shut a business down. No warnings, no phone calls. No email. Just shut down.
Even more remarkably, after proof by the owner that the site is not a scam. After tediously providing documentation as to his 15-year history in the business (including an average of $100,000 a month in credit card charges; with less than .33 of 1% in chargebacks), no return call, no email notification, nothing! Just left hanging. No explanation as to why such a rash decision was made.
Frankly, I was astonished by Bill’s polite and detailed responses during our hour-long conference call. I know him to be an honorable, hard working businessman. It took him 15 years to develop his stellar reputation in the toll-free industry, only to have it shattered overnight by some low-level peons, looking only to cover their a**.
David, by nature I am not a vengeful type. Neither is Bill. But as much as Bill is committed to alerting the business community as to what happened, I am committed to do the same within the developer community. The flippant attitude by the likes of Rochelle and Tyler cannot be tolerated. And while they may have figured out the statistical, actuarial likelihood of some small percentage of chargebacks, ask them whether they also took into account the huge potential loss of future business. I was going to bring to you, within a few weeks, two clients doing several million a year on the ‘net. I offered to show you the sites. We just signed a new client doing 5 million a year. We are being brought in to decide between Amazon and Ebay. Guess what we will be recommending…
Thank you for your help.
Gary
Paypal sucks says:
July 25, 2010 at 12:22 am
As a stand towards PayPal…I will be moving our business account to Amazon. Last year we did almost 2 million with PayPal. It’s always a nightmare dealing with them, their charges, and their incompetent staff. I made this decision almost 3 months ago to do this. Your situation gave me further fuel to do so.
Please keep this anonymous
Typical Paypal (1 comments.) says:
July 29, 2010 at 2:44 pm
This is very typical of PayPal in my experience.
they are somehow pro-consumer when you’re a business, yet somehow pro-business when you’re a consumer.
If you’ve lost money, they’ll never recover it for you. If you’re trying to collect money, they’ll never let you collect.
I’m sorry you had to find out the hard way. I have to be VERY careful when doing transactions with PayPal and have learned the hard way that you should transfer all monies out of your account as fast as possible. Any monies left in holding in your paypal account are, theirs. I don’t know how / what / or why they continue to get away with it – but hopefully over time, they’ll eventually be exposed.
PoorPal (1 comments.) says:
July 31, 2010 at 8:35 am
Yep, back in 2002 they “froze” my account with $30k and promised to release it after a few simple verifications. Then when they found out I was just 18 years old, they started demanding more. After 6-7 weeks of nothing but complying to their demands, I gave them an ultimatum. Rather then working with me during the holiday seasons where I would of processed $100k a month, they decided to freeze my account and hold the funds for 6 months. In the end, they released the funds exactly 13 months later.
Sue them, right. Their lawyers will refer you to their TOS you agreed prior to doing business with them.
I contemplated suicide for a while but fortunately didn’t (as I am here writing this now). Tough times and thanks to PayPal making the worst Christmas in my entire life. I literally had to start over from zero funding. Took me 4 years to get back to where I was in terms of finances.
Lesson learned, get a real merchant account who has an accredited bank behind them and tie their API system into your system.
Eli (1 comments.) says:
July 31, 2010 at 1:08 pm
Yes, PayPal is pretty sad. Unfortunately, this is actually pretty typical for them.
Please leave this page up for a long time, as my clients often ask why I recommend that they don’t use PayPal, and I like to have good examples to show them.
So sorry to hear about the issues you’ve had – nobody should have to deal with this sort of crap.
For myself, I use a regular merchant account (NOVA) with Authorize.net as the Internet gateway – never had a problem. You may want to have your programmers look into that.
Hot billion says:
August 30, 2010 at 10:01 pm
I HAVE HAD SOME MAJOR BAD EXERIENCES WILL AFTER THEY LOCKED MY ACCOUNT DOWN CAUSE OF EBAY TOOK SOME MAJOR FUNDS OUT OF MY ACCOUNT. CAUSE THEY ARE THE SAME COMPANY THEY COULD DO THAT.. AND THEY WIPED PUT MY ACCOUNT THIER MISTAKE. AND WOULD NOT FIX IT FOR ABOUT TWO MONTHS WHICH I LOST A FLOOD OF CUSTOMERS PAY/ MONEY/ ADVERTISING COST LOST. WHEN I HAD JUST FIRST START MY ACCOUNT. THEY COSTED ME BIGTIME. SO I GUESS I WILL HAVE TO GO WITH THE FLOW AND DIMISS THEM!TOO!
Sal (1 comments.) says:
August 31, 2010 at 3:45 pm
Lengthy post but very interesting. Thanks Bill, Gary et al…
What do you think og Google CheckOut?
I ask because we’re in a start-up mode and were considering PayPal as our payment processor.
Appriciate any comments.
Regards.
Sal.
Attila (1 comments.) says:
August 31, 2010 at 7:00 pm
Try merchantplus.com – they have awesome rates and I got two accounts with them. I’d advise you get a “real” merchant account and not something like PayPal or something similar to it (Google Checkout, 2Co, more).
Hot billion says:
August 31, 2010 at 11:18 pm
ld never transfer about $10,000 i had to refund all my customers to another paying option no satisfied customer support at all. I COULD NEVER GET MONEY TRANFERRED TO MY BANK ACCOUNT VERY POOR. NO GOOGLE PAY FOR ME NEVER!
Claude greiner says:
January 26, 2011 at 11:53 pm
Yea paypal is just a hassle to deal with. Based on my experience their fees are too high, and when there is a chargeback they always side with the customer, even if the customer is wrong.
Buy something from someone using paypal and get ripped off, good luck getting your money back. It’s a loose loose situation with them