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PayPal Limited Account

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  • PayPal Limited Account

    I used to be the sole director of a limited company (Company A), which had a PayPal account that I can no longer access (PayPal have blocked access to it, so cannot even log in).

    Company A was dissolved in August 2016 because it became insolvent.

    I am also one of two directors of Company B, which was incorporated in May 2014, in a completely different industry, and we have held a PayPal account in the ltd companyís name since day one.

    We decided to clear some stock on eBay in the run up to Christmas, and have just over £2,000 in our company PayPal account, but on Monday evening PayPal limited our account and sent us an email advising the account (belonging to Company B) has been linked to the PayPal account for Company A which apparently owes PayPal some money.

    The email suggests that if the money owed by Company A is paid, then PayPal will reinstate the account belonging to Company B.

    What I would like to know is, are PayPal legally allowed to hold Company B to ransom for money owed by a company that no longer exists?

    I have sent PayPal a couple of emails since Monday advising them that Company A was dissolved two years ago but yet to get a reply, so I was wondering whether itís worth sending them a letter before action to get our £2,000 released (although Iíd much prefer to get our account reinstated).
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  • #2
    You can't force them to continue the account, but they cannot seize B's money in this way. I find them a very odd lot to deal with.

    I'd probably continue with a formal dispute rather than going to court just yet.

    Comment


    • #3
      Originally posted by gazfocus View Post
      What I would like to know is, are PayPal legally allowed to hold Company B to ransom for money owed by a company that no longer exists?
      Paypal will argue that you as a director represent a risk to their business, even though you are operating under a different legal entity.

      The 180 day hold is within their terms as it protects them against chargebacks.

      Did you not receive any notifications about the debt at the previous company? Paypal are normally pretty on the ball when an account has a negative balance. They usually send a lot of emails, letters and then employ debt collectors and solicitors.

      Comment


      • #4
        Unfortunately, when the previous company folded we had to vacate the office we were renting. We didnít owe any money to the landlord but it was not feasible to stay there after the company folded and we didnít want to run into issues of the new company being at the same registered address.

        I did submit a dispute with PayPal yesterday advising them that Company A has been dissolved for two years now, and they emailed back today saying that the steps to restore the account have been altered. Logging into the account now states that thereís outstanding balances on two accounts that use Company Bís domain in the email address but I donít recognise either email address.

        Comment

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