Over the weekend I stumbled on a rather sad story having to do with PayPal, but it has a great lesson for those who have PayPal accounts or about getting one and I thought I must pass it on to you quickly.

Brad Gosse has been operating a verified PayPal account for the past nine years, in fact, he was one of the earliest people to sign up with PayPal when they started operation. Over these years his business had been absolutely legal and had obeyed all their rules. He hadn’t had any problem with them whatsoever.

Then, a couple of days ago, he received a mail from PayPal stating his account had been limited, with thousands of dollars trapped in it without any explanation. He was not contacted or questioned before they limited his account.

For your account to be limited means your account must not have more than $500 for a year. So that meant Brad’s money worth thousands of dollars was gone if he couldn’t reinstate it.

Quickly, he called them up and followed it up, and his account was reinstated to verified position again.

In shock as to how close he was to losing his money with PayPal, he thought he should withdraw part of it to his bank account. So he did just that. But a bigger shocker was awaiting him the following day.

PayPal completely suspended his account for 180 days (six months), again without first contacting him or letting him know why they were taking such action. After calling them up again to find out from them what the problem was, he was told there was unusual fund transfer from his account, and the account remained suspended.

Although Brad was lucky to have moved some of his money to his bank account, and also has other accounts that are not PayPal, he is still distraught because as a big time Internet marketer, he still has several thousands of dollars locked away in the PayPal account. You can read up his story from his site, which I have given at the bottom of this post.

But first, here is the bottom line of this story:

Brad is an A Canadian and operates his business from Ontario, yet he could be treated this way by PayPal. He understood their rules and had obeyed them religiously for nine years, yet he woke up one day to find his PayPal account had be limited, and then totally suspended.

This means everyone should be very careful about using PayPal account. In fact, in recent times PayPal has been notoriously reputed to closing people’s accounts at will without any explanation.

Once they notice large movement of funds in or out of your account, or see you accessing your account from different IP addresses, they wouldn’t try to reach you for explanation, the best they would do is to limit your account, suspend it, or completely ban you. If they limit your account and you cannot reach them or satisfactorily show the proof they will ask of you, there goes your hard-earned money!

My Recommendation

Use other alternative payment solutions to PayPal. It is true that PayPal is perhaps the most widely known online payment solution around today, and with Ebay, which they own, they are monopoly, however, there are also other payment solutions, which are coming up strong, and which you should try using.

There is 2CO.com, moneybookers.com, and there is Fastecash.com (if you are in Nigeria), to help you receive payments for the sales of your products.

If you like a program you want to sign up with as affiliate and they say on their sites it’s by PayPal they make payments, you can send them an email to ask if they wouldn’t pay by other means, like wire transfer or check that may be convenient to you. This is what I do, and a lot of times I get positive responses and I’m able to sign up.

If they insisted it’s only by PayPal they can pay, then try look for their competitors who are willing to accept your payment terms.

This is very important for Nigerians and people from other countries who are not listed by PayPal to use their system. Don’t try to get into PayPal through the backdoor like I’m aware many people are doing by using Chinese, India, etc, addresses to sign up with PayPal. This is like putting banana in a monkey’s mouth for PayPal, which will be happy closing your account and freezing your money.

There are many business opportunities you can do on the Internet without PayPal, therefore the risk of trying to force yourself to use PayPal when they did not list your country is not worth it at all.

If you must use PayPal, be sure not to allow your money with them to amass. In fact, don’t leave more than $500 at a time in your account even if it is verified.

That’s it! Hope this information comes handing. You can link this page from your site so that your visitors can get this information and be protected too from possibly losing their money in PayPal.

Please leave your comments or questions. And if you’ve any experience with PayPal that may help other people, please leave it in the comment.

If you are in Nigeria, I recommend you sign up with Fastecash for free and be able to take payments on your site. Follow this link to sign up: Fastecash Online Payment Solution.

Here is the link to Brad’s website: PayPal Suspending Accounts

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This entry was posted on Monday, November 2nd, 2009 at 11:34 am and is filed under Internet Marketing ideas & tips. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.