You might be aware that PayPal MyCash cards can be found in many stores and can often be bought with a credit card.
Some people have been using these for manufacturing spend: they buy the cards, load the card value to their PayPal account, then withdraw the money to their bank account.
Not surprisingly, PayPal isn’t a fan of this behavior. Last week, PayPal sent the following email to many of their customers who have been buying these cards and using them in ways not as intended. Below, names have been removed to protect the (not so) innocent and bolding has been added for emphasis:
Dear __________,
We like to keep things safe and secure, including your PayPal account. To do this, we regularly check the activity on our customers’ accounts.
We’re not sure you’re aware but it appears the MyCash has been used for deposits to your PayPal account, and then those deposits have been withdrawn.
The MyCash feature is for making deposits to your PayPal account for retail purchases.
If we continue to see this activity of using the MyCash with your PayPal account for cash withdrawals, we may have to limit or close your PayPal account.
If you think we’ve made an error, here’s how to contact us.
1.Log in to your PayPal account.
2.Click Contact Us at the bottom of the page.
3.Click Send us under Email Us.
4.Follow the instructions to complete the steps.
We value your business and appreciate your attention to this matter.Thank you for being a valuable member of the PayPal community.
Sincerely,
PayPal Compliance Department
PayPal, an eBay Company
Now to find a safer way to unload those funds…
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[…] have received a warning from PayPal saying not to deposit MyCash cards and then withdraw the cash (details here). Specifically, PayPal may have warned: “If we continue to see this activity of using the […]
I got this warning today. I’ve only unloaded ~$600 in the last 3 months while loading 4k every month. Do I need to stop all loading on this account or just the withdrawals?
It is just the withdrawals to bank accounts that they are worried about.
Ah but if an account is only receiving funds from other accounts transferred in are they going to limit that account from withdrawing funds to their bank account?
That should be OK
Kind of old news as they do this pretty regularly. I got shut down almost 1 year ago for doing this. Money held for 21 days and then check issued.
I started with Paypal recently. I find it next to useless because I am always getting card denials so I cant use it for normal spend. Every time I do a big withdrawal(even for legitimate non-MS purchases and only MS I do is to load serve) I get a block on my card so my next transaction no matter how small is denied and I have to call in to get it unblocked.
Based on my experiences with these I think they are auto generated and once you stop the bad behavior they stop the threats……..you have sending accounts and you have receiving and bank withdrawl accounts…….
1.5 yrs ago i was maxing this in 2 accts and my wife got sudden death cancel. No reconsideration. Took 6 months to get the $1000 from the acct. I had to submit financial info as if i were buying a house. My wife spends every cent she can from my account now!
How are people unloading these? I would never withdraw directly or by ATM but instead always used my PayPal business card for legit purchases and they just withdrew the max about of cashback. Is this the action that PayPal is issuing warnings against? I would be surprised if they were able to tell the nature of a transaction at a retailer, unless they are looking for suspicious amounts in particular.
A lot of people (including me) were simply transferring money to their bank accounts.
What about an account that is only receiving funds from other PayPal members and then withdraws that to their bank account? Surely that is not against their T&C?