Money transfer, virtual currency, or money service -- Fraud or scam -- Complaint #14008189
Complaint Overview
Complaint ID: 14008189
Company: Paypal Holdings, INC
Product: Money transfer, virtual currency, or money service
Sub-Product: Mobile or digital wallet
Issue: Fraud or scam
State: Illinois
ZIP Code: 60502
Date Received: 2025-06-10T12:00:00-05:00
Date Sent to Company: 2025-06-10T12:00:00-05:00
Company Response: Closed with non-monetary relief
Timely Response: Yes
Consumer Disputed: N/A
Submitted Via: Web
Consumer Narrative
XX/XX/year> was the date that a payment reserve of {$20000.00} was placed on my PayPal business account due to a high potential of incoming disputes due to a rapid growth in sales of my business. This is reasonable since PayPal should take caution for potential fraud in rapidly growing businesses. However, my business is clearly an honest business though our dispute rate did end up being a little high. All claims and dispute cases have been closed and the store has only received 4 total claims/disputes in the months XXXX out of XXXX customers. Also, the last transaction that we processed through PayPal was on XX/XX/year> because of the multiple payment reserve that were placed on the account which held up our profits and caused us to stop processing orders altogether. We patiently waited and were compliant to every request that PayPal gave to show that we were legitimate sellers ( tracking information for each order, response to any existing disputes, identity confirmation, etc... ). Up until a couple of weeks ago I finally decided to call customer service and open a ticket to review the plasibility of the reserve and it came out rejected due to the following reasons : Claims and/or disputes - Excessive level or significant change - ( A high amount of claims or number of disputes filed against you ; A significant increase in the number of claims or disputes filed against you ). Refunds - Excessive level or significant change - ( A high amount of refunds transacted ; A significant increase in the number of refunds transacted ). After I requested for more information on the reason for the rejection of the appeal for the reserve, I was told that the information isn't accessible to me. However, from my perspective, the value of the potential disputes/claims/refunds in the future are significantly lower than the amount reserved ( {$20000.00} ) given that our last order was processed on XX/XX/year> and there hasn't been a single dispute since XX/XX/year> with only 2 disputes/claims in the month of XXXX and 2 disputes/claims in the month of XXXX. Our average order value for this store was ~ {$60.00}, meaning that the value of the disputes in XXXX are totaling to approximately {$240.00} and the value of the disputes from XXXX are {$0.00}. The reason of excessive level or significant increase in claims, disputes, or refunds are not plasible reasons for this reserve whatsoever given these statistics. If the concern was to cover for the potential value of future disputes, claims, or refunds, then clearly {$20000.00} is an absurdly high amount for this case. This is highly suspicious, as it is unclear why they would sustain this hold and double down on it, even after a customer kindly requests a reasonable review, and then refuse to provide plausible reasoning after rejecting the review. It calls into question the true intention of the reservation of my hard-earned money and what they are doing with the funds. This hold has caused me to suffer under debt for many months now, and I am kindly asking for this reserve to either be released or lowered significantly.
Frequently Asked Questions
What is Complaint #14008189 about?
Complaint #14008189 was filed against Paypal Holdings, INC regarding Money transfer, virtual currency, or money service specifically about Fraud or scam. It was received by the CFPB on 2025-06-10T12:00:00-05:00.
How did Paypal Holdings, INC respond to this complaint?
The company responded with: "Closed with non-monetary relief". The response was timely.
What is the risk level of this complaint?
See the risk assessment section for details on this complaint's risk profile.
How do I file a similar complaint?
You can file a complaint with the CFPB at consumerfinance.gov/complaint. Select the appropriate product category (Money transfer, virtual currency, or money service) and describe your issue in detail.
Can I see other complaints against Paypal Holdings, INC?
Yes, visit the Paypal Holdings, INC company profile at readthecomplaint.com/company/paypal-holdings-inc to see all complaints, risk scores, and analysis.
Disclaimer
This analysis is AI-generated based on publicly available CFPB complaint data. It does not constitute financial or legal advice.