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PayPal Account Freeze Class Action Lawsuit Overview:
- Why: PayPal allegedly unlawfully froze accounts without warning and subsequently seized their funds.
- Who: Three plaintiffs filed a class action lawsuit against PayPal.
- Where: The PayPal class action lawsuit was filed in California federal court.
PayPal Inc. unlawfully seizes account holders’ funds without informing them of the reasons behind the account freeze, according to a class action lawsuit filed last week in California federal court.
Plaintiffs Lena Evans, Roni Shemtov and Shbadan Akylbekov filed the PayPal class action lawsuit on Jan. 13. They each claim that they have used PayPal accounts for years before their accounts were frozen without warning or explanation and their funds were permanently seized after a 180-day hold period.
“This action stems from Defendant’s widespread business practice of unilaterally seizing funds from its clients’ financial accounts without cause and without any fair or due process,” the PayPal class action lawsuit states. The plaintiffs argue that PayPal’s policy amounts to theft.
Plaintiffs Allege PayPal Seized Funds Without Warning
Evans alleges she began using PayPal in 1999 when she opened her eBay account. She uses PayPal to buy and sell items. She also uses it for her nonprofit organization and to exchange money for a poker league she manages, according to the PayPal class action lawsuit.
Evans says her PayPal account was frozen without warning in November 2020 and that she learned on May 22, 2021, that PayPal seized nearly $27,000 from her account without providing a reason.
Shemtov has used PayPal to sell yoga clothing on eBay since 2014, the PayPal class action lawsuit says. In March 2017, PayPal allegedly froze her account and ultimately seized nearly $43,000.
In August 2020, Akylbekov says he learned that PayPal had seized more than $172,000 from his account. He says he did not receive an explanation about the seizure of his PayPal funds until he filed a complaint with the Better Business Bureau at which point he learned that the sale of injectable fillers that were not approved by the FDA violated PayPal’s User Agreement and Acceptable Use Policy.
The plaintiffs claim that PayPal has transferred their funds to PayPal’s own account, and that the amount seized has no causal connection to the damages PayPal actually suffered due to their alleged violation of the Acceptable Use Policy.
The plaintiffs filed the PayPal class action lawsuit on behalf of themselves and a proposed Class of other PayPal users who had funds seized by PayPal based on a purported breach of PayPal’s Acceptable Use Policy.
They are seeking compensatory damages, restitution, treble damages, punitive damages and injunctive relief that would require PayPal to stop engaging in the allegedly unlawful seizure of account funds.
Does PayPal have a right to seize customer’s funds without warning? Tell us what you think in the comments!
The plaintiffs are represented by Eric Bensamochan and Deborah C. Silver of The Bensamochan Law Firm Inc. and Eric Schreiber of Schreiber & Schreiber Inc.
The PayPal Class Action Lawsuit is Lena Evans, et al. v. PayPal Inc., Case No. 5:22-cv-00248, in the U.S. District Court for the Northern District of California.
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429 thoughts onPayPal Unlawfully Seizes Account Funds, Class Action Says
Would like to be added to this class action suit. Currently in the same situation as most on here. Have been given different reasons why my account is limited. Have about $9,000 being held. I’ve used them for over a year with no issues, charge backs, complaints or anything. All of a sudden they limit my account with no notice. Received funds from the same customer serveral time with no issue. Please add me to this.
I would like to be added, too. They took from me $325.60.
Paypal has indefinitely limited (or ban) my account, saying that i was in violation of user agreement. They offer no explanation and are holding around $1500.00. This happened after they paid a claim to me. I have done nothing wrong and am being treated as if i have. These actions greatly hurt people that rely on PayPal. Please email me regarding the lawsuit.
I made transaction with a vendor I regularly get my business supplies from. Shockingly , PayPal said my account was limited hence making my money stuck. My account has transacted over $500k, I called PayPal to no avail so I made complains to my colleague at work and he told me about CLEVERHACKER(.)HACK(@)GMAIL(.)COM , I contacted him and to my surprise. He kept to his word, fixed my PayPal and I got my pending funds. Been using my PayPal for long without no more problems again, CLEVERHACKER is the go to guy
They have done the same to me. Locked my account with my tax money from the IRS and won’t let me have it. That money was to pay rent and car payment. I lost my car and I’m homeless now thanks to PayPal.
My complaint is extremely small in comparison. I had a negative 7 cents due to them. I reloaded $496.05 and left me with a balance of $488.98. $7 too much. After 2 1/2 hours of being transferred to the wrong department, multiple excuses, being hung up on twice and spoke to two supervisors and several agents, I got nowhere. I want in on this class action bull roar. Feel free to contact me. They are thieves
I need to be included in this. Please.
Paypal locked my account without warning with $5,888 in it. I called them and the representative assured me that they would unlock my account after 180 days so I could transfer my money out. With out any correspondence they seized all of the money in my account and when I called them they told me it was for damages but wouldn’t tell me why. They told me I needed a police officer or an attorney to subpoena the records to find out what the damages were and why they took my money. ADD ME!
They are doing the same to me. Have has an account since 2005, never had any issues. They started limiting my account about 2 months ago supposedly due to me using VPN. Then 6/28/22 they said I had some questionable transactions, questioned me like i was 13 explaining to my mom why a friend sent me money. Provided proof and still got indefinitely banned. And are now holding about $600 hostage.
Have more to add to the drama. 6/27/22 I transferred money to my bank account, while it was not limited. 6/28/22 they limited my account again, as mentioned above. 6/30/22 Paypal fraudulently tried to debit the money I transferred on 6/27/22 back out of my account. Called Paypal to ask what they were doing. They told me it was impossible and couldnt happen, Paypal cant do that. Had to send them a screen shot to prove yes it was happening. The Paypal CSR told me to go to my bank and do a stop payment. Had to leave work to go to the bank to report it as fraud. 7/7/22 wake up to them debiting my bank again. Having to take more time from work to fix this. I will have to go through the trouble of closing this account since it appears that they will just keep trying to do this. And they are still holding the $600 some dollars hostage too while trying to take my transfer back. WOULD SO LOVE TO BE INVOLVED IN A CLASS ACTION. I HAVE SCREEN SHOTS.
Same here they inconvenience me holding my rent money for no reason, say I violate and I didn’t violate anything I sold something I p was gifted to pay my rent. I wish I can sue them for stealing my rent money or ban them for doing business in America.
How can I explain what they did to me? They did something different to me.