Do what I am doing, join in on the class action suit. Since every lawyer I've talked to that works on a contingency basis is afraid to confront Paypal in front of a court of law, your best recourse at this point is class action. Join in, and take all that there is from Paypal, this bullshit unethical company.
Want to know of a better fraud tip to make Paypal pay the deficit? Have yourself and a friend set up an auction for some kind of in-tangible good on eBay, Pay for it, and then wait till the funds reaches your friends bank account, then have you friend tell paypal that it was shipped ripped [enter a good excuse here] and if Paypal doesn't pay back a reversal, then have your friend reverse the charges from their bank account and Paypal will be forced to pay the deficit. Call your bank and tell them you delivered the product to the recipiant, and have them reverse the Paypal transaction. I am not inclined to discuss weather or not I have done this on these boards, but I can tell you that it works wonders!
Then have your friend give you in cash, the half portion of money Paypal just gave to you for free, and split that shit.
Do it for the community, trust me on this, it's a scam that requires that greedy P.O.S. company to PAY up for once, instead of requiring that their honest sellers Pay up for their inability to provide proper security for fraud losses done on services that they should be providing protection for.
I say fuck them over this way, it's the best way to do it. Then immediately close out your account.
While you're at it, take part in the class action lawsuit going on right now.
Click Here to sign up for the Jacoby & Meyers/Gerrard & Gibbs class actions suits against Paypal.
The Paypal contract has been deemed unconscionable by a federal Judge in San Jose California. The user agreement has been deemed to be used in an illicit fashion to insulate themselves (paypal) from consumer inquiries. The Judge also denied their ability to use their mandatory arbitration clause, since this as well as many factors has contributed to Paypal's unfair one-sided stance for their customers, which has also protected Paypal for these many many years from consumer inquiries.
Part of paying seller fees, requires Paypal to act on their end of the service as a Payment services medium. This unethical customer service practice, along with Paypal collecting interest from frozen funds is violating various State and Federal consumer protection laws. Since Paypal is not a FDIC insured bank, they've been working through a loophole all of these years, using their bullshit contract to protect themselves from consumer inquiries.
Whatever you do, DO NOT PAY THEM. Make sure you explain your situation at length with your debt collectors, and make sure to send a cease and desist letter.
Consumer laws protect you against collection agencies, and if any collection agencies damage your credit, you have all the rights in the world to sue the hell out of them.
A cease and desist may be the last resort as a tactic to get rid of them, read up on these laws pertaining to debt collectors. check on the internet for your state and you'll find what rights and avenues are available to you. You'll be much better off if you go to a government site that spells out your rights, obigations, and options.