Comment by kweks | Hacker News Reader

Comment by kweks | Hacker News Reader

Parent Full thread

A few examples of these clauses being exercised were on HN:

- https://news.ycombinator.com/item?id=29935515

- https://news.ycombinator.com/item?id=32739950

If it wasn't obvious, cherry-picking bits and pieces from various jurisdictions isn't legal; PayPal deftly deflects any legal challenges to their various dispersed entities making them essentially untouchable if you don't have unlimited resources.

If anyone is interested, in the EU, this is their playbook:

- Ignore all communications unless it's a C&D from lawyers

- Deflect responsibility to PayPal Luxembourg.

- They have, or have had literally 90% of LU lawyers retained, meaning your case will not / cannot be accepted by the majority of LU law-firms due to conflict of interest

- Deflect onto the CSSF (Luxembourg Monetary Watchdog)

- Respond to the CSSF that the complaining company is not based in Luxembourg, which results in the CSSF concluding that they are not the competent structure to rule.

- Case closed, your funds have been stolen, and PayPal has artfully dodged the relevant regulatory bodies.

+9000. This is a ridiculously good post! I knew PP was a bad actor, but not this bad. This step: <<They have, or have had literally 90% of LU lawyers retained>> How did you discover it?

Luxembourg seems like an even shadier place than Switzerland for money laundering -- the "legal" kind. There is a stock exchange in Luxembourg that is used for all kinds of back door listings to avoid regulation in other jurisdictions. It is is /similar/ to money managers using Caribbean Islands (Cayman, BVI, etc.) for their business registration.

We discovered it first hand - we run Lab401. PayPal seized ~50k from us (check the first link in my original post).

It took us literally a month of calling LU law firms until we finally found one that didn't have ties to / being the tentacles of PayPal.

Can you give some clues about the alternative to PP?

Credit cards - yes you might lose 20% of your customers - but can u find a payment processor to handle your business?

EDIT: the story from your other comments is pretty hair raising!!

>I knew PP was a bad actor

Okay so before I say anything that ends up putting my foot in my mouth, lemme just check something real quick…

http://web.archive.org/web/20001018034024/http://paypalsucks... well, this won't work…

http://web.archive.org/web/20001206210200/http://paypalsucks... neither will this…

http://web.archive.org/web/20010215013627/http://paypalsucks... ah yes, roughly the first time it went online.

http://web.archive.org/web/20200707092456/http://paypalsucks... …aaand the last successful crawl before hosting expiration/domain reparking.

Well, I can now confidently say:

We've known that for literally decadeS.

Edit, in fact, come to think of it, that—almost certainly—means:

People've linked PayPalSucks.com in the comments on Slashdot _since before 9/11_.

NOT a criticism, more an observation.

LU is not shadier than other places, probably even less. But Paypal is shadier than other banks (like, a lot shadier).

You wrote: <<LU is not shadier than other places, probably even less.>>

I disagree with first hand experience. LU is a money laundering state, simliar to Switzerland, or akin to Ireland for dodging corporate taxes. The EU would be a better place if it removed/cancelled all of this shitty economic behaviour!

"Interesting".

And I thought the practice of scaring me with "unusual activity on your account", then locking me out until I am sending them all the required proof of identity (photocopy of ID, proof of postal address, ..., that they demand and as a private corporation will handle and store and review this very sensitive set of data some sort of way by who knows who.... ).

When I sent what they asked for and asked them about the nature of the "unusual activity" and if they reported it to the relevant authorities (possible breach of a monetary account) the response was a big fat nothing. I thought to ask them to provide the evidence on the "unusual acctivity" after this as I plan to contact local authorities myself to report the hacker of my account or whatever the "unusual activity" prompting strict measures required was - must be serious and illegitimate! - but decided not to. Does not worth the effort.

Rather I closed my account for good and not looking back. I will not rely on them this way, I thought. And from the above list I believe I was right. I did not regret this so far in the past ca. 5 years.

Bye Bye PayPal.

If what you say is true, the company morally should be torn down and their executive jailed, but legally our society allows and even facilitates such completely immoral and unethical actions.

A society that rewards people and organizations for placing themselves above the law is a society on the way down.

The most disappointing element of this whole process was to see PayPal manipulating the entities that are meant to provide regulatory control.

In this instance the CSSF is rigorous, but ultimately rigid. They have clearly defined boundaries and protocols. The problem is that companies such as PayPal exploit this to their benefit - which means that they ultimately use the watchdog entities as peons to execute their illegal practices.

I think the issue is: Which tool offers the same benefits? As buyer and seller? I always had bad experience with paypal's resolution center. But what are the alternative if you don't want to spread your credit card everywhere, send and receive money, with an acceptable user experience?

There are services where you can get temp. cc numbers what 'wrap' your 'real' card. You can limit them to certain merchants and limit amounts, cancel them etc..

Can it happen that there is no competent court to rule? When Luxembourg CSSF or court claims they are not competent, that means the case should revert to your location.

I've actually dealt with this with many clients. There are ways to hold paypal accountable for your account, but it won't change their unlawful policies.

The terms of use for paypal have a mandatory arbitration clause that all disputes should be submitted to binding arbitration. This isn't necessarily bad. I've gotten clients money back every time so far. You just need to know what strategy you are pursuing. There are two ways you can go about it - File for arbitration or file in small claims court. One good thing about arbitration is that under the terms of use, and to a certain extent procedural rules, that paypal has to pay the costs of arbitration up front if you ask them. This means you do not have to pay anything for your claim to be heard. Here is the main problem at first - due to the procedural rules for arbitration, any party can have the action dismissed at their request if the claim is cognizable in small claims court where the plaintiff resides. Small claims court usually handles claims up to 5000 and there are certain types of claims excluded. To get around this, you need just to state your claim is worth more than 5000 to prevent your case from being dismissed . The small claims route works as well. Paypal is unlikely to send an attorney to represent them. You'll get a judgment but then will have to collect on it. Also you'll have to pay some costs up front. The reason this is typically so easy is because the reasons paypal gives for acceptal use policy violations are typically not grounded in any facts. The theft is so transparent that they are unable to defend the action in any serious way.

I find it a little insane that consumers in the EU shouldn't be able to pursue Paypal in their own countries.

They probably can, but PayPal is actively working to make it seem like they can't. All part of their craft.

That’s awful. So if CSSF isn’t the right approach, what is? Are there general civil courts for Luxembourg?

Nitpick, CSSF is the LU banking watchdog, and Paypal is a LU bank.

The CSSF is the "Comission for Surveillance of the Finance Sector". Paypal LU is a credit insitution, but not a bank.

It falls under the CSSF's jurisdiction:

"PayPal has the status of a Luxembourg credit institution and is under the prudential supervision of the Luxembourg supervisory authority, the Commission de Surveillance du Secteur Financier (the "CSSF"). The registered office of the CSSF is located at L-1150 Luxembourg (Luxembourg)."

That’s not correct, the CSSF classifies it as a bank, see https://searchentities.apps.cssf.lu/search-entities/search?&...

Very interesting, as the text I quoted comes from the PayPal LU site..

Reply on news.ycombinator.com