Limited Paypal..

Hey guys, so my Paypal officially got limited & locked today.. I have to provide them information as to how I'm getting these sudden big payments of $500+.
(I get them through my moneypak/mycash service where they send me their mycash prepaid codes and I send them the money back on their PP). I know that PayPal isn't fond of virtual traders, that's why Im hesitant in saying the story since the MyCash/MP money I'm giving to my customers (Like Shine, Theresa, etc.) are used so they could use it to sell/purchase virtual gold.
What should I say?
Also how long does this process take?

 

It probably looks like laundering/anti-laundering to them. Could take a while if you don't have a legitimate reason for your account's actions.

 

I just found out that the MyCash/MP money was utilized to sell bitcoins rather than RSGP.. would that change the situation?

 

Firstly, be careful of what Shine / Theresa are implicating you into. Using your service to cash in / out Bitcoin transactions can put you in a sketchy situation. If they are using your services for that and not disclosing it to you, and instead masking it as an RSGP transaction, that is VERY dishonest on their part.

Do not mention the word Bitcoin to Paypal if you ever want to see your account again. Just say you were accepting the payments for RS Gold. Essentially, you were accepting the payment and then paying your suppliers their portion for the order afterwards.

Will they allow you to continue using Paypal? Who knows, that is up to their risk management department. If you want my advice though, do not let people use your name to cash in/out cryptocurrency.

 

Oh , I wasn't aware that they were even more against cryptocurrency transactions as opposed to virtual game currency transfers. What if they ask for a screenshot (not sure if they will) of the gold being transferred? Shine confirmed to me that the exchanged was PP>BTC , so theres no RS gold transfer screenshot that he or I can provide :/

 

Paypal is a horrid company, honestly I have so many problems with them. I avoid using it at all costs minus sythe transactions which go directly to the bank.

I've been limited so many times and have to provide the same info over and over.

 

I know below is a wall of text. But for those of you who seriously trade for a living, or who run eCommerce businesses, much of the info below may be helpful (and yes, the shameless plugs may be helpful as well)

Banks, payment aggregators, and processors generally have a "hands off" approach to Bitcoin, meaning they don't want their accounts anywhere near it.

PayPal especially, as it complicates things on a regulatory and compliance standpoint.

The Financial Crimes Enforcement Network (FinCEN) released guidance two years ago to financial institutions (and businesses) which regarded Cryptocurrencies (and certain virtual currencies) liable for reporting and regulation. So exchanging real cash for a virtual currency like bitcoin, counts as money exchange. (just like FOREX).

To engage in money exchange, you need an MSB license (Money Service Business), which is easy enough to get (kind of), but an aggregator like PayPal, also transmits money on behalf of an aggregate number of users, which requires MTS licensure at the state level (which is time consuming, and costly to do). Because of the individual licensure across 50 states, as well as that of varying laws between countries (because the one of the value added props of BTC is that it allows for easier transfer of funds between borders) for foreign exchange, PayPal doesn't even want to touch Bitcoin with a ten foot pole because of the liability it causes (as well as the issues with AML & KYC compliance <--- look those up, and now you know why PlayerAuctions requires an insane amount of security checks for some people to even be able to transact).

Shameless plug, but this is one (very important) of many reasons why a lot of high volume sellers opt to use PlayerAuctions as a processor for virtual trades. Our banking relationships are established (even having undergone commercial underwriting), so that you're PayPal/Skrill accounts don't run the risk of becoming limited or closed. Having that done to your PP account, and then creating another one results in a vicious cycle that leads further down a black hole where all of your associated information gets funneled back to eCommerce risk networks.

@OP, sorry this happened. I would be surprised if you can remove the limitation/lock, and even if you did, your PayPal will now always have those flags appended to it which will obviously make trades in the future a hassle. The best advice I can give you, if you'r not wanting to use PA, is to switch to Skrill, and to be very careful with regards to engaging in transactions involving Bitcoin.

Indeed, to leave your finances in their hands is not ideal when dealing with digital asset exchanges. We have a special relationship with PayPal, which allows us to keep fees low, as well as to safeguard member's individual accounts who transact through us.

Outside of PA, PayPal has demonstrated a willingness to support real money trading, but at the price of a huge liability premium by tacking on an additional 15%. This reason, in combination with Blizzard's 15% commission on Diablo 3 trading is why the D3 market remained large on PA even after the RMAH was launched (our 10%, vs the 15% + 15% of the Blizzard/PayPal partnership). All this, with a direct partnership in place with a company who has the ability to track whether items were exchanged or not (so, I am frequently amazed when people balk at our commission rates, because it demonstrates a failure to understand the real economics of the business with regard to cost, risk, and profit margins. Espescially when they fail to compare it the alternatives: complete risk of loss (direct trading), or catering to corporate avarice (RMT supported by publishers & processors).

Knowing the risk profile of this industry, yes PayPal should take an additional cut due to their subordination to banks in order to protect their own bank accounts, however I would have placed this rate between 7% - 10% would have been fine. The additional 5% - 8% margin is for profit. Business owners would call this lucrative, gamers would call it greedy.

 

^ I actually read the above statement.


I wonder why the owner of PA actually takes time to write these things, god knows your filthy rich already.

 

Very tough situation, and difficult to find a cover story for doing that. You have to come up with a story of why you are receiving large amounts of money while also sending it out, without involving the word bitcoin, or moneypak redeemal services.

Would try something along of the lines of "was switching from world of warcraft to runescape, so I was selling all of my world of warcraft gold for payment methods that don't allow chargebacks, and purchasing runescape gold", as a last resort.

Good luck man.

 

In this case, like I mentioned above, it's very simple. He was selling Runescape Gold. The buyer gave him the Moneypak, he paid his supplier, and the supplier provided delivery to the customer. End of story, and technically it's exactly what happened (or should have happened).

 

Hubba, I dont think you will find a more suitable explanation than that.
They may limit you from moneypak use in the future, but this should get your paypal itself unlimited.

I actually told them I was trading in virtual goods when they limited me for excessive payments in a short period of time, and they unblocked me incredibly quickly. Didn't need to provide any proof of trades. I told them I could give them screenshots of many trades / chat logs if needed, but they didn't ask for it.

 

I could sove this with hubba if hubba redeemed my code and cause problems.I've also updated my requirements from receipts to 'receipts signed with signature' from now on.Thanks all guys posted.

 

I may just go with this then. However, I used paypal mycash, not moneypak.. if that changes anything.

 

doesn't

 

It'd be nice if "filthy rich" were the case, but the reality is such that while PA has a formidable aggregate marketshare for securing transactions, we are far from critical mass.

If we *wanted* to be filthy rich, we would likely follow the same margin model as Blizzard/PayPal with 30% commission rates. With ours being 1/3 of that, we operate in a very lean fashion (in fact, many RS sellers on Sythe, will have far more comfortable lifestyles than my own with what they make).

Despite the huge volume that goes through PA, this is the reality:
- Our margins are small
- Like any business, with a 50 person staff, we have normal sales, general & administrative costs (SG&A, or overhead)
- Since we act as a payment aggregator, WE incur all loss if fraud occurs:embar:
- In addition to SG&A costs, in order to provide the security we do for buyers and sellers, each transaction we process comes with associated fixed costs to keep the transaction safe (we lose money on every single order below $52).
- Orders also have "extended costs" associated with the after-sale support we provide. (we would save a ton of money if after the sale completed, everyone was left to their own devices. But we go the extra mile by supporting transactions with problems after a sale is completed).


The question is still begged, why I spend time posting here. I decided that was a fair enough question, so I made a separate post just for that: http://www.sythe.org/showthread.php?p=14332157#post14332157

 

Crazy, could you elaborate? Have you had any personal experiences with Paypal/bitcoin?

 

I am not an expert on the subject, but I've read my share of horror stories. Check out "Charlie Shrem" on Google. Everyone buying/selling BTC for $ on the Digital Goods forum should be aware that they are operating on shaky ground. Especially if they are a resident of the USA.

 

Worth the read, thanks. Essentially the guy got banned for two years irl because he was unknowingly (?) processing btc payments related to the silk road.

 

I think it was a 2 year sentence because he knew it was silk road related.
Read it a while back so I'm a little fuzzy on whether he knew it or not.

 

Shit bro im so sorry to hear that.... I guess thats why I dont see many people offering this service. 0.0

PA : * Thanks for what you wrote. It will certainly help people. I read it all.