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Paypal Won't Release Funds To Slain Soldier's Family
robustyoungsoul writes "Popular sports blog Deadspin established the Adam Knox Fund for the purpose of raising money in honor of the fallen soldier who was killed in Iraq. They took the donations through a PayPal account.
Turns out now, however, PayPal will not release the money due to the way the account was set up on their end."
"Paypal Won't Release Funds To Slain Soldier's Family"
That isn't quite true, they are holding the funds until mid April, probably due to somebody screwing up. I'm not convinced that it was Paypal's mistake to begin with.
"Paypal Doesn't Want Slain Soldiers' Families To Receive Aid"
Come on now, yea, there may have been a mistake made, but it has nothing to do with the money going to a Slain Soldiers' Family.
Why the need for so much drama?
It could be worse, it could be Monday.
While I hate large corporations ripping people off as much as the next guy, I don't think this says anything that bad about PayPal. This is my guess at what happened:
So it doesn't seem the company is trying to rip anybody off or laugh over the graves of the dead. In this case.
Lesson learned to all: if you're going to claim you're a nonprofit organization, BE A NONPROFIT ORGANIZATION.
This site was not nonprofit, and was having the funds sent to their own, private account.
Yes it's sad, but ask yourself the following: could you trust a nonprofit paypal donation if you knew that they only had to casually mention that they were nonprofit? That they didn't have to prove it?
There's nothing stopping the people who run that website, other than personal honor, from pocketing the cash and giving the finger to everyone who donated. And THAT is why PayPal has those policies. I'm surprised that they'd even hand over the cash after 180 days in fact.
It's sad, yes: but in the future, they should know to make an actual nonprofit organization with its own account. Doing such a thing isn't that hard: you just have to apply, and make a seperate checking account. My club at High School did it, and the people in that club were a bunch of idiots, especially in High School (myself included).
-Vendal Thornheart
It strikes me that they have already proven their innocence beyond the point that paypal has a right to know about. The fund in question was set up (possibly improperly) with an explicit, legitimate purpose that all donors can be expected to know about. That means that it is not phishing. Furthermore, there is no evidence that potential phishing is any part of the dispute. The only issue is that paypal is treating the account as belonging to an official, regulated charity, whereas the deadspin folks were doing an impromptu fundraiser.
If PayPal wants to continue pretending to be a bank, they should be regulated like one.
"The Federal Reserve is a fraudulent system."--Lew Rockwell
End The FED. -
Read the article, and it will be obvious that the person who set everything up is not only and idiot, but they are rude and foul-mouthed as well.
PayPal is doing what they have to, giving themselves time to investigate to make sure it isn't a scam. Scams like this are rampant, both with soldier funds and hurricane relief funds.
Considering the guy did NOT set this up as a non-profit, he is going to be in for a rude shock come tax time. Once PayPal releases $20,000 to his PERSONAL BANK ACCOUNT the bank will file a "suspicious transaction report" with the gov't. I wouldn't be surprised it HIS BANK didn't then freeze the funds for 30-90 days.
Assuming it is then released, the IRS is going to count that $20K as INCOME and will want 20-33% tax from this person. All his protestations of "but I gave it to the widow's family as a gift!" won't amount for shit.
Sure, he meant well, but he is going to be a living example of "The Road to Hell is Paved With Good Intentions" because PayPal is only the beginning of his descent.
Learning HOW to think is more important than learning WHAT to think.
Notice the use of the word "Had." I'm sorry, but responding to a problem like that with that sort of language is somewhat ridiculous. Paypal is supposedly following their own policy. You can respond to it by acting professionally, writing it up for the public, and then returning to PayPal and trying to get access to someone higher up the command chain, or you can do what they've done, and mouth off about it. Considering the way they reacted in text, I have a hard time believing that they acted professionally enough on the phone to make the PayPal representitive honestly feel they were there in good faith. As well, their request that people assault PayPal with phonecalls and other contacts is somewhat petty. Honestly, I'm not a fan of PayPal in the slightest, but this isn't the way to react to such things.
The reason why Paypal does this is because creating a charity account without being able to provide documents proving your charity status is suspect. It's a red flag. Another red flag is having a new account suddenly receive a massive amount of funds from many individual.
:)
So why didn't they outline the fact that these things would be "red flags" when it comes to recovering money from them?
Why would they let someone set up an account in that way when it is obviously going to create problems with the recovery of funds?
Obviously, the account never should have been able to be set up as a charity without documentation identifying it as such if it's going to create these kinds of problems down the line. The problem is clearly of PayPal's own devising by allowing the account to be set up as such a trap in the first place.
To make things clear, the types of accounts that is:
A) New accounts
B) Unable to provide documents
C) Receiving many funds from many separate individuals
If you can't guess already.... accounts created by phishing scams!
Even if the person who set up the account requested the wrong type, PayPal should have either not set the account up in that way without the proper documentation, or outline the ramifications of not being able to produce said documentation when the money is withdrawn. I think it's obvious that they didn't do either of those things from the reaction of the site, and the "ho-hum should've known better" reaction of a lot of users here.
These people can provide a lot of documentation, just cannot prove they are a charitable organization, because they aren't, never were, and never should have ended up with an account of that type, but because of PayPal's corporate policy of setting up interest-traps like this (they obviously want to trap as much money as possible by luring people into setting up PayPal accounts in such a way that they will enter a "suspended" state which they can then collect interest on) they are now unable to collect their funds.
If PayPal were interested in helping people not be ripped off, they would demand all of the information required to draw down from a PayPal account at the establishment of the account, not when someone tries to withdraw their hard-earned (or hard-earned, then donated) cash from PayPal.
Paypal sucks, but not in this particular case.
This particular case highlights exactly why PayPal does suck. Because they encourage their staff to use legal technicalities to bar people from receiving money they have a legitimate right to, because it is more profitable and legally prudent to do so than not to.
PayPal sucks because as a corporate citizen they are psychopath with a pathological money addiction.
The same reason every other large corporation sucks.
Buddy, if your definition of evil is PayPal then you need some serious help.
Umm, are there stories that show Paypal in a good light? I haven't heard / read any...
It must have been something you assimilated. . . .
PAYING with PayPal is rarely the problem. It's GETTING YOUR MONEY BACK from PayPal where all the issues come up. All their policies are designed to do one thing: keep the cash in their accounts, earning interest for them, for as long as possible. As a payer, I've never had any issues.
Dude, I think I can see my house from here.
There's absolutely NOTHING new in Paypal doing this. They aren't regulated, so they can do what the hell they want to in effect. and you can notice this.
On top of that, atleast in one point, even fscking janitors could get to see your account info there!
It does get better tho... Rather than working honestly, in one case i had, i got a fraudulent order, found out about that myself
a day later, e-mailed them about the transaction needs to be reversed. This got to happen due to the fact, that they do not require any authentication at all to deposit more into paypal, as long as you have username & password.
I explained what has happened in detail etc. meanwhile, calming the victim down (who's account was stolen, victim of a phishing attack). I wasn't going to just send the funds to her, then the insane transfer fees would be lost etc. Total amount was approximately 150.
Almost 2 months later, i finally got a word from there... Nope, they hadn't read my e-mails, it seems it was automated message, saying the funds had been refunded etc. but the thing is, who's money it was, never got it. She noticed my Myspace profile 6months later, and she hadn't got STILL got it, while paypal had taken the funds from me.
In effect: Paypal decided to take the funds, without refunding them.
Nevermind the insanely high fraud amounts with them! I dropped them, after using them years and years, guess they calculated the
one time cash was worth to them more than continuing transfer fees.
People, don't use paypal, there is honest companies out there to replace them... That being moneybookers!
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