What the Hell Happened to PayPal? | Hacker News Reader

What the Hell Happened to PayPal?

thefp.com

59 pointspseudolus50 comments

I support regulations that would make it difficult for payment processors like PayPal/Stripe to cut off companies without due process (ideally, third party due process).

The reasons behind all of the bans listed in this article are all one-sided pure conjecture. A skepticism I've developed after interacting with "they hate me for my freedom" types is that they are often omitting key details in an effort to make themselves look like the victims. It's likely they all know exactly why they were banned, but divulging such matters would make them look bad.

I wish the author would have done more due diligence on their part and uncover the actual likely reasoning behind the bans. Some of the best investigative journalism is done when you let your subject tell their side, then confront them with facts that are counter to their claims.

PayPal's poor transparency around how they cut companies off is bad. But it can be the case that each of these people interviewed are also bad and would have been cut off if there were better regulations and transparency around how PayPal operates.

While I agree that the article doesn't do well to expose the reasons behind these bans. I think transparency and due process are the correct things to focus on. If we had both articles like this could not exist.

One thing to keep in mind is that Paypal and Stripe are Payment Facilitators, not payment processors. You do not have your own merchant account when you use them, you exist as a sub id on their master merchant account. I suspect this is why the rules are different than what you would see with an actual merchant account through a bank.

Checked out when it cited the scammer behind the "Freedom Phone" as a victim. Come on.

e: Their current site, for a laugh: https://www.freedomphone.com/

The whole article is a tire fire.

That's not to say that accountability isn't a serious problem with PayPal and companies in a similar position. It absolutely is. But this particular source has an overt Trumpist/antivax/right-wing slant.

And of course this is intolerably awful because only progressive, woke, leftist, pro-Government-covid-control sources should in any way be tolerated in their views? Only they're free of slant and emotional bias? Indeed. Why not analyse a source for its specific arguments and their evidence instead of its political tendency?

Same. I started with oh, they are talking to Theil. What does the king of the surveliance state have to say? When they followed up with Freedom Phone, it was clear what sort of story this was.

(This is in no way an endorsement of the PayPal dumpster fire)

Yes, that amazed me. Twitter preinstalled ? That alone would make me stay clear of them. And who really cares about tesla apps. A vehicle needing apps on a phone to me is a massive fail.

And honoring Must, give me a break. I am very glad he was born in South Africa.

> A vehicle needing apps on a phone

You don't need the phone app.

You can unlock and drive the car with a regular plastic card or a key fob as the access key.

This seems like just another opportunity to randomly bash at someone online.

> The Free Press is a new media company founded by Bari Weiss

this is the same crazy right winger who has been posting "The Twitter Files"

And she's jewish!

She calls herself a left-leaning centrist. But yes she is involved in the Twitter Files.

Source: https://en.wikipedia.org/wiki/Bari_Weiss

Yet if PayPal deemed FreedomPhone a scam, why did PayPal end up dispersing the funds to FreedomPhone rather than returning them to users. This just makes it less likely that users will ever see the product (however pointless and exploitative I deem that product) they paid for.

This article has a bit of a slant towards a particular audience, but the issues it raises are real and worthy of consideration.

PayPal owed him money, so they paid it. They don't owe him an indefinite business partnership.

We don't know if they deemed him a scam, but it certainly looks scummy to me, so I can't blame them on that one. If people knew it was a ~$100 phone from a company in China that virtually nobody has ever heard of being sold for $500, they probably wouldn't buy it.

> PayPal owed him money, so they paid it.

After a significant delay during which PayPal got to hold onto money that wasn't theirs as an interest free loan.

While, I would strongly recommend against anyone buying a Freedom Phone, that doesn't mean that the way PayPal handled this was acceptable or beneficial to users.

>If people knew it was a ~$100 phone from a company in China that virtually nobody has ever heard of being sold for $500, they probably wouldn't buy it.

I have never heard of the freedom phone before this but basing the justification for them being banned from using PayPal on the fact they resell a cheap tech product from China is a ridiculous position to hold.

Just be honest and say that you don't agree with their political agenda next time.

This is the first I've heard of them. What was Freedom Phone doing to earn them a ban?

Appears to be a ClearPHONE 220:

https://www.clearcellular.org/clearphone/clearphone-220-seri...

Because you think the phone is silly or disagree with their politics that's a reason for Paypal to ban them?

>To add insult to injury, PayPal held up $1.2 million in payments to Finman’s company. Eventually, Finman got his money, but the delay, he said, “killed all the momentum.”

And this is why I don't suggest PayPal to anyone. I work with physical goods in a local trade industry. High value but low risk stuff. We need cash flow and Paypal is too high risk as they hold funds too frequently.

Stripe has been great to us.

Are you in e-commerce? PayPal is a must have for e-commerce. Some companies try to abandon PayPal and see a sharp decline in sales. Being the first digital wallet gave them a first mover advantage that will never go away.

Only chance is enough people start selling online and see how PayPal treats sellers and stop using it as buyers.

Yeah we are in e-commerce. We've never had PayPal. I don't think many of our customers would know the difference. To them it's just a place to put some credit card details.

We're looking at moving to a much cheaper local alternative (typically 1% transaction fees) https://www.paymark.co.nz/products/online-eftpos/

I don't think PayPal has the same foothold on the market here in NZ.

We have this abomination https://www.polipay.co.nz/ it logs into your online bank account to make payments. I hope people start to realize how terrifying that is.

PayPal’s stronghold in the US is because eBay was one of the first ways to buy things online and using PayPal was the only way to pay. I’m sure PayPal didn’t have that sort of leverage in other countries where online sales grew in other ways.

eBay is going to stop supporting or offering PayPal next year.

I think the narrative is a little different.

eBay got big, and at the beginning you did the usual terrible American mail-order payment methods-- personal cheques and money orders. I can recall getting money orders because they'd usually clear faster and I might get my item in a couple weeks!

PayPal was one of several competitors in the early 2000s, but they were by far the most successful; I suspect this was because they did a lot of "we'll give you and the recipient USD5 as a referral fee" growth hacking.

Eventually, they merged with eBay and the "they're the dominant choice" became "they're the only choice."

Good point. What were the PayPal competitors in the early days?

The one I recall was Citibank's C2IT. They decided to offer an even larger referral bonus (USD 10 IIRC) so some people ran obvious-sham auctions basically advertising "we only take this, and here's the convenient referral link for me right here."

The claim that PayPal is "a must have" for e-commerce is misleading at best - the largest e-commerce sellers largely _don't_ accept PayPal (see, for example, Amazon) - and I would argue that isn't some weird coincidence.

> Some companies try to abandon PayPal and see a sharp decline in sales.

Removing PayPal is going to be way different than not having it in the first place, because you have cultivated a client base that expects to pay with PayPal.

In online music forums one of the frequent requests I see when new VST makers come out is 'when will you support Paypal?'.

The largest sellers aren't a reason to use PayPal. They can be assumed to have their shit together by now and can protect payment details from a breach. But for smaller e-commerce sites I'd never in a million years trust them with direct CC number entry. You need a proxy and in the US PayPal is the only dependable option for payers.

Don’t you have onetime virtual CCs in the US?

I have this on Amex business and it required adding the service. None of my personal credit cards have this.

Amazon accepts Venmo as of a few months ago.

  whois paypalsucks.com                                                                                               
   Domain Name: PAYPALSUCKS.COM
   Registry Domain ID: 42655783_DOMAIN_COM-VRSN
   Registrar WHOIS Server: whois.enom.com
   Registrar URL: http://www.enomdomains.com
   Updated Date: 2022-11-15T08:40:51Z
   Creation Date: 2000-11-14T21:06:26Z

Man, it's been a while.

To me as a European it was completely mind boggling, why anyone would voluntarily use this service. Then I was exposed to US bank sector stuck in 1990s (in my case BBVA) and had no other option than to use PayPal.

PayPal will die when US banks will reach 21st century and start offering same products and services as European ones.

https://news.ycombinator.com/item?id=33971577#33972336

Well Paypal and vemo are unregulated in the US, so they can do whatever they want. I think there has been some halfhearted attempts to regulate, but a after a few campaign donations, the pols pretend they never tried.

What to do ? Every time Paypal and friends do something like this, raise a complaint with your local and federal government. If enough people complain, maybe, just maybe, something will happen.

I feel as though the article is leaving some critical details out in order to push a specific viewpoint/agenda.

Testimonials from "victims" are only the side of said victims, with no details from Paypal or anyone else as to why this has happened. It's left to the reader to imagine a large conspiracy, when there may very well be good reasons that many of these people were banned.

I'm reminded of the term "Dopelar effect": if you throw a lot of bad information and ideas at someone quickly enough, they start to sound more reasonable. But if you slow them down, they don't.

I agree. When Paypal was founded, there was amazement within the industry that they were able to run a money transfer service without being completely overrun by fraud. I was told that Paypal's real secret sauce was their fraud detection algorithms. It was those algorithms that created a product that others could not easily duplicate. Perhaps the fraudsters are catching up with Paypal and their algorithms, and as a result, Paypal needs to block more and more legitimate businesses that they are unable to distinguish from fraudulent businesses.

The largest competitor in my field is suing another competitor (not me).

My Stripe account has been shut due to to my competitor sending in a copy of the lawsuit (not involving me) to Stripe falsely claiming I’m subject to the lawsuit.

Stripe staff in their IP notice claim department are unable to distinguish between real claims and malicious ones , and don’t seem to care either way.

He has not only taken my Stripe account down but also two other people using this tactic.

Specifically:

1) I have not been sued 2) I have not been named in any claim nor has my site been mentioned 3) I have not seen any evidence or the particulars of the claim against me. 4) nor have a received any letter from any lawyer

It seems it’s very easy to abuse Stripe's IP notice claim form by simply sending the case # and confusing Stripe's staff.

Stripe have done nothing so far and refuse to listen.

Avoid Stripe. This is a tactic will be abused in the future

After reading the article and then clicking through to its front page, the main conclusion I came to is: grievance sells, and the simpler the story told, the more effective it is at selling. When someone tries to tell me that some of the richest and most powerful people are the underdogs in the fight to protect my liberty, my BS meter goes off.

I canceled my PayPal account. There's no particular reason to keep doing business with them anymore.

I just recently signed up with them because they are the only payment for most Knobcloud sales (http://knobcloud.com) but now that I have it I use it almost exclusively.

Nothing, they have been doing that exact stuff for decades.

Disclosure: I have a PP merchant account, very small. It's the only payment service I've found that does not require me to maintain my own up-and-running web server. I can run my business from a passive web page. Once in a while I look for alternatives -- at least just to have a back-up -- but have not found anything yet.

When you say passive web page, do you mean a simple .htm file with no php (or other) server side language? Or do you mean it's fully managed by PayPal using a gui/admin portal?

Nothing that requires my own server. At the simplest, someone can just send me the amount of my price, and I send them their stuff. Otherwise, PP can create button code that I insert into my html.

If I could insert trustworthy code such as javascript into my page, that executes on the user's computer, that would be a fine compromise.

I'm not anti-tech, but I feel that spinning up my own server (even on a cloud computing instance) would be a lot of complexity for my tiny business. I don't even know where to begin, should I want to secure such a server. I'm a good programmer, but have not done that kind of work before. I also don't trust my own skills to protect my users' security.

Finalizing the transaction does occur at PayPal's site.

You can let someone pay you via PayPal without them needing a PayPal account (they can use credit card) and without you needing a web page. PayPal has a feature where you can create a payment link and email it to someone.

There are some payment gateways that do "hosted cart". You can give the customer a pre-configured link to the gateway's site and they see a pre-populated checkout form; everything PCI-compliance related takes place on their server.

Good.

The examples cited were scammers and grifters.

Some were, not all.

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