Opinion: PayPal / eBay in Violation of their Own Hold Policy

In a further action to shun sellers in favor of buyers, eBay / PayPal instituted the following hold policy on transactions for eBay auctions where PayPal is used for the payment remittance:

Why are my payments being held? 

Payment holds for eBay items are an effort to increase marketplace safety. We hold payments when we suspect a transaction may be risky. Here are the most common instances in which an eBay item payment may be held: 

• You have been an eBay member for less than 6 months, and you sell an item for more than $100 
• You have an eBay feedback score of less than 100, and you sell an item for more than $100 
• You have a buyer dissatisfaction percentage* greater than 5% 
• You have an average DSR of less than 4.5 
• You have received fewer than 20 Detailed Seller Ratings in the last 12 months 
• You are listing your item in a high-risk category such as gift certificates, video games, cell phones, computers, or consumer 
• electronics. 

All things being equal, here's where the card's lie in my instance.  I've been a member of the eBay community for 10 years with a satisfaction rating of 100.0%.  Yet, the policy above which I have never explicitly agreed to resulted in the hold of nearly $1,000 dollars.  Perhpas $1,000 dollars is not a lot to eBay, but it is certainly money that I was counting on.  Now that eBay has considered me "risky" how does the hold get lifted?

When will PayPal release the hold? 

Your funds will be released when one of the following occurs: 

• The buyer leaves you positive feedback 
• 3 days pass after proof the item was delivered** 
• 21 days pass without a dispute, claim, chargeback, or reversal filed on the transaction 

So even though I have offered free shipping, and insured the item for the full face value at no extra expense to the seller, my money could potentially be held for 21 days (or longer).  But wait, I did everything right.

Sale Date: 04.06.09

Worst Case Scenario Hold release w no dispute (21 days): 04.27.09

Item ship date: 04.07.09

UPS arrival: 04.14.09 (seller unavailable to sign)

Final delivery: 04.15.09 

Positive Feedback Left: 04.16.09

So, according to eBay's own policy, my hold should have been lifted on 04.16.09, as soon as the positive feedback was left, but certainly not later than 04.18.09, 3 days after confirmed delivery, but no, my money remains on hold--likely not to be lifted until 04.27.09 which is the last date the hold clear can be applied according to the policy.  And what does eBay have to say when I have complained on numerous occasions?  At least I got a humanoid response.  PayPal support has been nothing but robots with form responses completely unrelated to the issue.

Please understand that this policy is not 
made to cause problems for eBay Members like you. I am sure you have 
treated all your trading partners exceptionally well, but then even you 
would agree that not all sellers are at your level of customer
satisfaction. Therefore, to improve the quality of a transaction 
experience on eBay, we have introduced this policy. Also, this will help
increase buyer satisfaction which, in turn, can mean more sales for you.
We have found that after 21 days the chance of a buyer dispute or claim 
significantly decreases.

As far as I can tell, this is an escrow scam.  I can't believe that after 10 years of being a member (9 years w/ PayPal) this is what eBay has come to--a bunch of greedy policy makers.  Brilliant!

Letter: Dear Paypal, how is my money today?

Dear Paypal, 

  I would like to check on the money that you are holding for a recent eBay transaction.  I tried speaking with your virtual agent, Sarah, but she carefully skirted around the issue by pointing me back to the eBay Learning Center when I kindly asked for the hold to be lifted.  Since it appears that I have to wait for the hold to be automatically lifted 3 days after delivery confirmation, or 21 days from the payment date, I would like to receive regular updates about how my money is doing.  

  You see, these days one never can be too sure what a pseudo-bank might be doing with one's money, which is why I chose to require immediate payment for my eBay item to begin with.  So, after paying you $27 for the convenience of putting a hold on my money in an account that bears a breathtaking .32% interest rate, I think I should be privy to exactly what you are doing with my money.  AIG seems to be still selling credit default swaps for instance, and to some toxic assets are as exciting a risk/reward opportunity as the next big penny stock run up.  I'd like some assurance that the big brains at eBay are not trying to squeeze every penny out of sellers like me by entering in to a risky proposition with my money by drumming up some "marketplace safety" spiel to make margin by putting large payments in to a 21 day escrow to compensate for lost sales-- or worse, funding ridiculous executive compensation to people who think its a good policy decision to keep my money for a month.

  How's this for a good idea: my Paypal account is attached to my credit card.  Should there be a dispute, you can charge back the amount of payment and put it in escrow until such time as the dispute has been settled.  That way, I get my money, and the buyer gets the same assurance.  Brilliant!  

Sincerely, Rob

Opinion: Has eBay officially jumped the shark?

So, I've been an eBay member since 1999. I have an exemplary feedback profile and tend to sell high ticket items because that's the only thing that can pull a worthwhile net profit selling items on the auction site. Imagine my unrestrained enthusiasm when a hold was put on the "instant" PayPal payment for my recent MacBook sale. This action is clearly not protecting buyers in the marketplace, but is once again alienating sellers like myself willing to give it one last shot. Nice going policy whores!  This was after it took me 4 hours and two attempts to convince eBay agents that my listing was not fraudulently inserted--thus delisting my item and reseting my login. Brilliant!

If you think there is merit to the ad campaign that is running now which states the average person has about $3,000 worth of unused stuff sitting around the house, consider how much of that you would actually see if you auctioned it off--especially if it was many smaller items. Given the shipping cost, time, and ridiculous fees collected for auctioning items on eBay, unless you have one item worth $3,000 that is lighter than 10 lbs, why bother? If you just need the space, take your items to Goodwill and opt for the tax write-off instead. If you need the money, sell it on Craiglist--hey no Paypal holds there! If you want to try selling it on eBay, best of luck to you. Even new sellers are treated better than 10 year veteran sellers with 100% positive feedback. Total BS.

Final tipping point? The help link for the topic "Why is Paypal holding my money" from the http://contact.ebay.com/ws/eBayISAPI.dll?ContactUsNextGen page does not exist.