To quote the Something Awful page, why Paypal closed the account (as usual there is a serious disconnect between what a site menas and paypal thinks):

"we have received more than one report about suspicious behaviour from your buyers" says paypal. SA response: I AM NOT SELLING A SINGLE THING. What part of "donation" is difficult to understand? I even selected "donation" on Paypal's site when generating a link for this website.

The SA forums are currently hosted here: SA temp forums

from The Inquirer:

All your donations are belong us
PAYPAL HAS frozen a relief effort set up by popular web site Something Awful.

This brilliant wheeze will delay payments to poor people from hurricane Katrina. The good folks at Something Awful, themselves victims of the hurricane, decided to put their mouths where the money is and set up an account to take donations for the Red Cross.

Something Awful has a history of helping out, and has raised tens of thousands of dollars in the name of charities before, and will probably do so again.

This time, it may have made a mistake by choosing Paypal. SA received $20,000 in less than half a day, and then Paypal decided to shut the fund down. What's the problem? "We have received more than one report of suspicious behavior from your buyers."

I guess you are not shocked to find that SA is not actually selling anything.

Paypal is demanding "proof of shipping" information to the aggrieved parties, conveniently listed in a table on the site. The number of scammed parties listed is all of zero long, and if you want to submit an explanation, you need to pick at least one from the list of no aggrieved parties. It appears there is no one you can call, no one you can mail, just a form that is broken.

Something Awful was screwed by the storm. Not that money is at all critical right now to the thousands dying in the street. So the SA relief fund has had it's account locked, the $3000 donated by Rich Kyanka, the site owner, is sitting and in the Paypal coffers, and all they asked for was 2.35% for the service.

BoingBoing

The owner of somethingawful.com, a fairly large counter-culture website, started a collection drive for Hurricane Katrina survivors via Paypal.

It appears that Paypal has locked him out of the collections account and is refusing to cooperate. His drive opened only today and accrued $20,000 in less than 24 hours (although, as a journalist myself I am keeping in mind the possibility that Paypal is simply investigating the account for swelling so fast -- this is still bullshit, pardon my french).

All of the somethingawful.com's normal content is gone (their servers were in New Orleans) and there is nothing on there that isn't safe to view at work.

Slashdot

"SomethingAwful's forum denizens, on the call of site admin Richard "Lowtax" Kyanka, raised over $20,000 dollars to be donated to the Hurricane Katrina relief efforts. This was done via a PayPal donation link, and PayPal has now frozen the account on a twofold basis: one, that there have been reports of "suspicious behavior" from the "buyers," and two, that no shipping records have been provided for the donations."

,

My emails finally reached a human, I just received word (a word, the word "done") that Bugmenot has removed adland.tv from their listings.

yeay.