Thanks Paypal!

 Thanks Paypal!

I call "bollocks" on that one

For background to this long-running saga, see here: Paypal Won't Pay, And They're Not An Author's Pal.

In a nutshell:

I hadn't done anything wrong or even suspicious - I had just received a royalty payment from one of the Big 5 publishers - but because Paypal automate things as much as possible, because it is cheaper than human intervention (so they can make bigger profits for their managers and shareholders), it means they applied limits on my account and from that point on I was screwed and left talking to the equivalent of a brick wall. My money was held hostage unless I sent Paypal personal data that could potentially be used for identity theft, and/or information that didn't even exist. They ignored my complaints for weeks at a time.

That post was written on 12th December 2017, after almost two months of Paypal restricting my account. What has happened in the six weeks since then? Nothing. Oh, correction: Paypal have applied even more restrictions to my account. I have no access to it. No-one can pay into it. No-one can take money out. Paypal just keeps earning interest on it. Is it a coincidence that they benefit from making it harder for customers, and the longer they can lock you out of your account, the more this pseudo-bank makes out of your money?

Honestly, I'd advise anyone against opening a Paypal account; and if you have one already, I'd recommend you close it ASAP - while you can still get to your money. Paypal has proven to be a terrible choice for anything business-connected, and I wish I'd never heard of the company!

Thanks Paypal!

 Thanks Paypal! The helpful, caring, pretend bank. (Yeah, right.)

This is how much Paypal are holding hostage in my account - image from 25th January 2018.
Will I ever have access to it again? Who knows.
I certainly don't.

Hold on a minute - that's how much my account showed today. But this is an image from 8th December 2017:

What? Even though neither me nor anyone else has had access to my account, the total has been dripping down all along. That's over £20 that has disappeared since they locked me out. Is someone at Paypal siphoning away my funds? After my experiences so far, I wouldn't be surprised at anything. Bear in mind that this has already cost me days of time in dealing with their crap, making complaints, doing research, uploading data to their site, and so on.

The restrictions they chose to place on an account that was being used normally.
They won't allow the account owner to receive money or access their money, even though the account owner has done nothing wrong. Customers have no control over when Paypal will drop the drawbridge like this and sit counting the gold like Scrooge McDick.

Since then Paypal has been regularly teasing me with apparently spiteful messages, such as this email from on 9th January 2018 (18:42):

Whoa! After they had locked my account and prevented me from having any access to it, they had the audacity to email me to tell me I should pay for things with my Paypal account (that I can't pay for things with). Way to go, Paypal, rubbing my nose in it. Anything else you want to do while I'm down? A few kicks to the ribs, maybe? Unbelievable.

Shortly after that I also found that royalty payments from my book sales were being blocked, and I would not receive the future payments because that publisher was closing its doors forever, and was going to make its final payment into my Paypal account but had been unable to do so. More potential money being lost - money I'd earned and needed to live on. Thanks Paypal!

What should you do if Paypal demands personal data and locks you out of your account?

Well, if you are unlucky, you won't have the evidence they demand. Paypal may also reject it even if you do have it. But suppose you do have what they ask for below: should you scan it in and send it to them?

The only options Paypal gives for evidence. Even when they know the customer is in the UK where one of the three does not exist, and the other two are optional documents that not everyone has, and which we are generally advised by the Government and security experts NOT to share online with foreign organisations such as Paypal.

On 14th December 2017 I contacted the UK Passport Office and DVLA to ask them about this, as follows:

Sometimes companies such as Paypal ask for ID. Specifically, a scanned copy of a UK passport or driving licence, transferred to them online.

Is is safe and recommended to comply with that? Many people have concerns about sending scanned images of such documents to a US-based company, since they then have no control over who sees and has access to it, and it would be a prime document for identity theft. Due to all the court cases, criticism, and controversies with Paypal, they are not seen as a very trustworthy company to begin with (and they aren't fully bound by banking regulations either).

Do you have any guidance on this issue? E.g. that it is definitely okay for UK citizens to comply with this, or that they definitely should not?

Paypal may say (in a very vague and unverifiable way) that it is to do with "conforming to money-laundering regulations" but it seems strange that a regulation aimed at preventing dodgy behaviour would require sending scans of important documents around the world, when those documents could then be used for identity theft and fraudulent behaviour, as well as possibly breaking data protection laws (since the US wouldn't necessarily have the same rules in terms of things like storing information and passing it to other non-UK/EU organisations such as the NSA/FBI/CIA).

If someone sent Paypal a copy of a passport or driving licence and something went wrong (e.g. someone at Paypal stole or shared the details), wouldn't that potentially cause huge problems?

The UK Passport Office replied: "Her Majesty's Passport Office do not recommend that a photocopy of your actual passport pages are taken or that you authorise someone else to take a copy" [HMPO Customer Service E-Mail Team, Thu 14/12/2017 11:36]

The DVLA surprised me by saying: "I'm afraid we don't have any guidelines on this matter. The decision on who you give your driving licence details, or image of the licence, is a decision you must make yourself." [DVLA Contact Centre, 15 December 2017 09:57] No guidelines. It is all on your head. If you share your driving licence scan with an organisation like Paypal, and it leads to identity theft, you are on your own. There's no indemnity from Paypal either.

That seems like far too big a risk. Companies fail in security all the time. If your identity is stolen with this kind of ID then it can ruin your life (see here, and here, and here). It's not worth risking your life by sharing such crucial data with a company that isn't even regulated as much as a bank (and even banks aren't secure).

Personally, I do not trust Paypal (either that they need the documents, that they can look after the scans safely, that they would be honest about all the details if asked, and that they would be open about any sharing of the scanned images that took place under US secret service laws which don’t apply to UK citizens).

I replied to the DVLA [Fri 15/12/2017 12:53] and said "According to the above, that means UK citizens should not share it with them. Many thanks – unless I hear back from you to the contrary, I’ll take that as a stance supported by the DVLA. If there was a list of approved organisations I understand that you would make one available, so Paypal can’t be listed as an approved and safe organisation at present."

The DVLA must have accepted that summary, because they did not reply to say it was wrong.

So it seems clear - don't share that data with Paypal, let alone as scanned images sent over the Internet. If you do so, and it goes wrong, there will be no comeback, and you may never gain control over your official identity again.

But there's more.

My bank (a proper bank, not a pretend one like Paypal) sent me this email:


The email also included this bit:

So a trusted organisation will NEVER send an email containing a link to a login page. My bank says that. But guess what? Paypal regularly sends emails with links to a login page. According to my bank's security warnings, that means Paypal is not a trusted organisation. A few examples:

All those highlighted links go to login pages. And although it seems like you can tell what the URL is, that's not true - any text can link to any URL as easily as this: That's exactly how scammers trick people. And because Paypal include those links too, it makes it even easier for scammers to trick people. And we're supposed to believe that Paypal is secure and trustworthy with our most vital data, which they don't even need? Screw that.

For further information about preventing/protecting yourself against identity theft you may wish to visit this site.

Are other customers happy with Paypal and its customer service?

Since Paypal have refused to give me access to my account again it led me to wonder if I was alone in thinking they were a terrible company.

I decided to check the main Paypal reviews on Trustpilot:

Ouch. It's the lowest score I've ever seen. Bear in mind that some companies pay for positive reviews - even if Paypal did that, they have been swamped by the negative ones from customers.

I had a look at the Paypal UK site on Trustpilot:

Double ouch. And the pattern is repeated for every single regional Paypal that has reviews. That suggests that my experience is not a one-off, and Paypal is not a company to do business with.

I checked their own forum and it contained stuff like this:

Then I decided to look at some of the most recent comments on tweets from the various Paypal accounts on Twitter:

It's fascinating that the complaints come in so fast that Paypal can't deal with them. Add the small sample I took above together, and it is clear that Paypal seems to be widely despised by its customers.

But Paypal can act with such disregard because it has power in this situation. A huge legal team and the financial backing of a big company, versus individuals who may not even be able to access their money due to Paypal seizing it, and who could be financially crippled by the court costs. It's hardly a fair battle.

It's clear I should never have opened a Paypal account. Nor should you. Don’t make the mistake of ever opening a Paypal account. It's not worth the hassles and stress and wasted time and potentially losing all your income even though you’ve done nothing wrong. Stick to properly-regulated banks, not pretend ones.

I doubt if Paypal will give me access to my account so I'll do updated posts about Paypal and start digging in to some more of the dirt on this terrible company in the future. Feel free to comment with your own experiences. It's hard enough being an author without having your account frozen just because you had a successful week!

Update 31st January 2018.

I had sent Paypal a link to this post after I wrote it. This is their official response:

(And no, the issue hasn't been resolved in the slightest, even after months.)