This comment will no doubt drift out of sight, however:
Whenever this perennial "PayPal screwed us out of X monies" comes up (and I've seen it about 7 times in the last 3 years), no-one seems willing, or able, to actually understand why it happens.
It's this simple:
PayPal is an American company, and so has to obey US law, and in particular, financial regulations over money laundering.
[i]Section 351: Amendments Relating to Reporting of Suspicious Activities
This Section expands immunity from liability for reporting suspicious activities and expands prohibition against notification to individuals of SAR filing. No officer or employee of federal, state, local, tribal, or territorial governments within the U.S., having knowledge that such report was made may disclose to any person involved in the transaction that it has been reported except as necessary to fulfill the official duties of such officer or employee.
Section 352: Anti-Money Laundering Programs
Requires financial institutions to establish anti-money laundering programs, which at a minimum must include: the development of internal policies, procedures and controls; designation of a compliance officer; an ongoing employee training program; and an independent audit function to test programs.
Section 356: Reporting of Suspicious Activities by Securities Brokers and Dealers; Investment Company Study
Required the Secretary to consult with the Securities Exchange Commission and the Board of Governors of the Federal Reserve to publish proposed regulations in the Federal Register before January 1, 2002, requiring brokers and dealers registered with the Securities Exchange Commission to submit suspicious activity reports under the Bank Secrecy Act.
Section 359: Reporting of Suspicious Activities by Underground Banking Systems
This amends the BSA definition of money transmitter to ensure that informal/underground banking systems are defined as financial institutions and are thus subject to the BSA.[/i]
PayPal is legally required to both freeze accounts for review under the Patriot act when large sums of money quickly flow into accounts from non-US sources, [b]and[/b] legally required not to disclose the reasons for freezing said funds.
There's plenty more regulations for companies out there, however it amuses me no end to see the short-sighted band-wagon get going.
If you're ignorant of the way these companies work, and even worse, ignorant about what the [i]law of your own country[/i] demands of companies, then please: do the world a favour, and step out of the discussion.
Or, you know, protest against the people who wrote the Patriot Act.
You need to read more closely. No one has a problem with PayPal freezing accounts. The problem is that once they do so, they refuse to communicate with the account owner to resolve the situation.
I can understand that to a first approximation, pretty much everyone whose account they freeze is committing fraud. But there are exceptions, and their processes don't seem to take account of that fact.
Whenever this perennial "PayPal screwed us out of X monies" comes up (and I've seen it about 7 times in the last 3 years), no-one seems willing, or able, to actually understand why it happens.
It's this simple:
PayPal is an American company, and so has to obey US law, and in particular, financial regulations over money laundering.
[i]Section 351: Amendments Relating to Reporting of Suspicious Activities
This Section expands immunity from liability for reporting suspicious activities and expands prohibition against notification to individuals of SAR filing. No officer or employee of federal, state, local, tribal, or territorial governments within the U.S., having knowledge that such report was made may disclose to any person involved in the transaction that it has been reported except as necessary to fulfill the official duties of such officer or employee.
Section 352: Anti-Money Laundering Programs
Requires financial institutions to establish anti-money laundering programs, which at a minimum must include: the development of internal policies, procedures and controls; designation of a compliance officer; an ongoing employee training program; and an independent audit function to test programs.
Section 356: Reporting of Suspicious Activities by Securities Brokers and Dealers; Investment Company Study
Required the Secretary to consult with the Securities Exchange Commission and the Board of Governors of the Federal Reserve to publish proposed regulations in the Federal Register before January 1, 2002, requiring brokers and dealers registered with the Securities Exchange Commission to submit suspicious activity reports under the Bank Secrecy Act.
Section 359: Reporting of Suspicious Activities by Underground Banking Systems
This amends the BSA definition of money transmitter to ensure that informal/underground banking systems are defined as financial institutions and are thus subject to the BSA.[/i]
http://www.fincen.gov/statutes_regs/patriot/
PayPal is legally required to both freeze accounts for review under the Patriot act when large sums of money quickly flow into accounts from non-US sources, [b]and[/b] legally required not to disclose the reasons for freezing said funds.
There's plenty more regulations for companies out there, however it amuses me no end to see the short-sighted band-wagon get going.
If you're ignorant of the way these companies work, and even worse, ignorant about what the [i]law of your own country[/i] demands of companies, then please: do the world a favour, and step out of the discussion.
Or, you know, protest against the people who wrote the Patriot Act.
/looking on with amazement