Hacker News Reader

Comment by CPLX | Hacker News Reader

This policy has been discussed on HN before. It’s extremely cynical, and unique to PayPal’s status as a service that holds money for you.

Any service could say that you’ll have to pay $2,500 for violating the TOS if they want to. Instagram could say it, but nobody would give the money to them willingly and since it’s a bullshit clickwrap contract they’d have a hard time finding a sympathetic court to inflict it on you.

The problem is that PayPal says it and then doesn’t just shut your account down unaccountably with no human recourse they take thousands of dollars of your own money when they do it, and you’d have to fight them in court for it. It’s a fait accompli situation.

No it’s not remotely ethical.

View on HN

> Any service could say that you’ll have to pay $2,500 for violating the TOS if they want to. Instagram could say it, but nobody would give the money to them willingly.

Stubhub has a similar policy where you automatically get charged the entire sale price as a penalty (which goes entirely to Stubhub, separate and in addition to them refunding the buyer) for cancelling an order. Even if you do it right after sale. Most platforms like eBay or Amazon will give you some kind of strike for that, but I'd never heard of anyone attempting to fine you money beyond refunding the buyer. I cancelled the credit card so they can't charge me, but apparently they send people to collections for this. IANAL, but I think I might be able to argue that it is unreasonable liquidated damages, especially since their help site refers to it as a "penalty." PayPal is clearly trying to use the right language here, calling it an estimate of hard to calculate damages.

I think these liquidated damages in consumer contracts are really a terrible idea and getting more and more common with online companies. Apparently Zipcar will charge a $50 late fee if you are even one minute late, whereas other rental firms charge something like $12 a day and wouldn't even think of counting minutes.

> I think these liquidated damages in consumer contracts are really a terrible idea [...]

I agree.

> and getting more and more common with online companies. Apparently Zipcar will charge a $50 late fee if you are even one minute late, whereas other rental firms charge something like $12 a day and wouldn't even think of counting minutes.

I'd hope customers catch on, and competition takes care of this.

> I'd hope customers catch on, and competition takes care of this.

You mean they all realize it’s a great idea and implement same fees?

Huh?

Avis car rentals tried to charge me €150 for a tank that was €2 off being full.

That is the last business Avis will ever get from me. And ideally from some of you guys reading this too.

> This policy has been discussed on HN before.

Section 5 is new. It covers posts, content, etc that PayPal finds objectionable.

To understand this in context, say I’m a website based business that posts conspiracy theories about JFK and UFOs. People pay for exclusive content via paypal.

If I get labeled as misinformation on 300 posts, I could owe PayPal a minimum of $750,000 (300 * $2,500). I’m not saying PayPal will do that, but that appears fair game given the terms being provided here.

A prudent course of action would be to get pre approval from PayPal before accepting PayPal payments.

To me, this is what the document suggests.

Section number 5 under prohibited activities is what I was mentioning. There's a different section for topics requiring pre-approvals.

What legal justification does PayPal use for keeping people’s money when they shut down their accounts? Even if the funds were obtained in some illegal way, they are still surely not PayPal’s. Banks can’t decide unilaterally to just keep someone’s money.

They recover their "reasonable costs" from your money, after you agreed to them doing that when you decided to use their service. I've refused to use PayPal as either a buyer or seller for years now; anyone still doing so honestly can't act surprised when something like this happens.

What is the alternative?

Why do they need a legal justification, practically?

They take the money, and there is nothing you can do. If you spend enough money on lawyers, eventually they would give you the money back, but you'd lose on that deal too.

Ethically and morally it's abhorrent, it degrades the power of the law, but they can get away with it. Fuckers.

different than Instagram it has already access to your credit card/bank account, so I think they can just charge you and then you have to fight with your bank to roll it back.

Possession is 9/10ths of the law

This is nonsense, and typical layman logic when it comes to matters involving abandoned property and theft when on another premises. It is not even remotely inline with reality. In almost any jurisdiction in the US, one has legal recourse when someone takes their money or property. Whether it's in the other's control or not, it's still just as equally defined as theft.

In this case, it's a reasonable approximation.

If property is the subject of a reasonable dispute-- e.g. whether a contractual term applies-- whomever is holding the property has the upper hand. Especially if the amount of property/money is small compared to the probable cost of litigation and especially so if one is unlikely to recover legal fees.

To be pedantic, if you take stuff you already have control over, isn't that embezzlement rather than theft?

In any case, I agree with https://news.ycombinator.com/item?id=33063096

It's a quote from Roger Stone, and likely a joke.

That saying is far older than Roger Stone and since GP didn't attribute it I fail to see why you would think he was quoting Roger Stone specifically.

> > Possession is 9/10ths of the law

> This is nonsense,

ORLY?

When PayPal closes people's accounts and keeps the money, in what percentage of cases do you think the people eventually get their money back?

My guess is far fewer than 10%.

It's not completely nonsense, but maybe it kind of dances around the point. 99% of the time people don't have any legal access whatsoever because it's much too costly. Practically, people only have legal protection in catastrophic scenarios, where they have no choice but to pay exorbitant fees. So good luck getting your property back in 9/10 cases.

Reply on news.ycombinator.com