Is PayPal Cruisin' For A Bruisin'?

Has PayPal opened themselves up to a major class action lawsuit? I believe they have if some smart lawyer takes a look at their actions, or lack there of, in the last couple of years.

Maybe it's also time for one or more State Attorney General Offices to take a closer look at PayPal.

It appears that PayPal has engaged in Unfair and Deceptive Trade Practices and has not acted in Good Faith in their dealings with certain classes of account holders.

As the industry leader in the online payment field, PayPal has consistently and arbitrarily applied its Acceptable Use Policy ( AUP) and Terms of Service (TOS) on some businesses while completely ignoring others in the same businesses category.

PayPal has also encouraged and enticed PayPal account holders to enter into lending and line of credit agreements with PayPal Credit. In effect, PayPal has acted in many ways like an online bank.

They freely admit that when you open a PayPal account, you and they are entering into a Mutual Agreement, yet they view this Agreement as one-sided, one that they do not have to honor.

The refusal to give specific reasons for "violations of the PayPal AUP" while not applying the same standards to others is, in effect, voting for the success of one business over another.

Because of its position as a market leader, PayPal gives the impression to the general public that one business who has lost the privilege of accepting PayPal payments for no specific reason has done something wrong and is not to be trusted while allowing others in the same business category to continue to accept PayPal. Again, voting for one business over another.

This has caused irreparable harm and significant loss of income to far too many people going back for at least two years. That is a lot of financial damages for which PayPal should be held accountable.

For many who have lost their PayPal account privileges, this is what they see when they login:

"You can't use PayPal anymore
At PayPal, we value a safe community for our customers to do business.
We noticed activity in your account that’s inconsistent with our User Agreement and we no longer offer you PayPal Services.
Any bank or credit card information linked to your PayPal account cannot be removed nor can it be used to create a new account.
You can still log in and see your account information but you can’t send or receive money.
Any money in your balance will be held for 180 days, after which we’ll send you an email with instructions about transferring your money."

Even after 180 days, especially in cases where there was no charge-backs, they will hold your bank account and credit card information hostage, refusing to allow you to remove them from the PayPal account information but giving them continued and long-term access if they wish. Nor, are you protected from any breech of your confidential account information.

How many times have we seen news stories of major corporations being hacked and consumer information being exposed?

The potential liability to PayPal in that one area alone could be staggering.

PayPal tries to hide behind their requirement for Arbitration but refuses to provide the Account Holder with what activity they found to be inconsistent with their User Agreement and provide no appeal or review process, nor any Arbitration avenue that is readily found.

How do you enter into Arbitration if PayPal refuses to provide any specific reasons for their actions? Are they taking action against a specific account holder, or a class of account holders. By their actions, it is clear that their intention was to be applied toward a class or classes of account holders.

PayPal is not acting in Good Faith regarding Arbitration and is simply using the mere mention of it as an attempt to avoid legal recourse.

PayPal arbitrarily applies this "standard" to only some and does not apply it to ALL PayPal seller accounts in the same business category.

With very little effort any single person, limited to only using a publicly-available search engine and in a few minutes, can find at least 100 or more PayPal seller accounts in the same category of business for which this penalty was applied to others. It should be obvious that the number who have escaped this penalty may be in the tens of thousands.

With all of their resources they could easily have found these and many more sellers in the same account class if PayPal had wanted to be consistent with the application of their AUP and TOS policies.

It is obvious that PayPal does not intend to fairly apply their "standards" nor act in Good Faith in the application of their TOS.

It may just be time for one or more State Attorney General Offices to investigate PayPal's pseudo-banking practices in addition to the filing of any Class Action lawsuit intended to recover the substantial damages caused by PayPal's actions, and penalize them for their Unfair and Deceptive Trade Practices and failure to act in Good Faith in their business dealings with account holders.

It's too late for PayPal to address and "fix" these and many more violations to avoid liability. But it is time that PayPal be held accountable.