Further proof that Paypal sucks bigtime: Freezing Katrina funds

The goons over at SomethingAwful forums, known for being a brash, childish, silly, sometimes harsh, lively community, decided to give to the people of New Orleans and started a fund drive. Their servers are hosted by the guys behind the interdictor livejournal from New Orleans where web cams, photos and horror stories from inside the city have been keeping lots of people up to date of what is really going on down there since this horrible situation started.

So, having their credit card servers offline in New Orleans, the Something Awful goons had to rely on an outside company to bucket the cash from their fund drive, and they picked Paypal.

Turns out the silly goons have generous bleeding hearts and gave $3,500 AN HOUR to the fund drive, just beautiful to see and making them the 'Uncontested Greatest Community on the Internet', but then what did Paypal do? What would paypal do?
Why, close the account as soon as it clocked past $20,000, of course. The account is closed without warning, the funds are frozen and paypal is showing their true colors once again. Read the whole sad affair at Something Awful.

Be careful when you use paypal. At the very least remove your money from it. They can and will screw you over, it's not a matter of "if", it's just a matter of time.

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Dabitch's picture

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.


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.


"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."


Dabitch's picture

Heated discussion about this is currently going on in the EBay forums here where some idiots say things like this in response to people who explain that SA forums have given money to charitable donations in the past and have a good trackrecord: "How do you know that? Did you follow the money around? This looks like a scam to me and I am glad that Paypal took action. In fact, Paypal should be congratulated for acting so quickly. ", and get snapped back at with things like " I would just like reiterate the point made that Something Awful is a more reputable site than ebay.". True that.

Google News Cluster about this so far (Just us and The Inquirer, hopefully more news orgs will pick this up).

James_Trickery's picture

Yet anotehr idiot who shouldn't be operating heavy machinery such as computers hooked to the internet spews moron-wisdom in the Ebay thread:

No matter, I reported them to the RED CROSS and filed a complaint their ISP. The link on the www.somethingawful site that says 'Red Cross Donations' does not go to the REAL Red Cross website.

They reported a paypal donation link to the Red cross? What a dickhead. Further down there is someone with more internet smarts: "The biggest "scam" here is PayPal. Please folks, donate directly to the Red Cross, if possible, without using PayPal as a middleman." Amen! Paypal skims 2.35% of the top of everything, which would be $470 - but I guess they got greedy and took the whole $20,000 pie instead. (Paypal is under no obligation to release those funds, ever, if they 'suspect' fraud or just have a funny feeling or are in the mood according to their terms of service.)

James_Trickery's picture

PS - in a further disconnect Ebay (PAYPAL) have loads of scam-type items on sale taht supposedly will send all their profits to the red cross. Most likely they never will for example HURRICANE stickers. Ebay (PAYPAL) lets that crap slide, but shut down 20k destined for the red cross without even bothering to have a human check the account (and perhaps make the funds only payable to the red cross, or call Something Awful that owened the account or anything else at all!)

Dabitch's picture

Metafilter thread you should read it for the comments.: SomethingAwful.com , which has been running on fumes since Thursday because they're hosted in New Orleans, added a Paypal donation link for Katrina relief to their barebones status update site yesterday, raising more than $3,000 an hour. Paypal then froze the account for "suspicious activity," preventing over $30,000 in donations from reaching the Red Cross.

Paypal aren't making friends over this one. And why is it that Paypal now claims that they can't free the donations to the intended charity because "we do not have a tie to the Red Cross," but can only send them to United Way?More paypal in the news: Katrina Relief Fund account frozen by PayPal at Bit-Tech.net , and PayPal Blocks Hurricane Relief Funds at BetaNews.

caffeinegoddess's picture

Wow...I am flabbergasted. This is totally unacceptable. I know paypal is crap but this really takes the cake.

blondino's picture

I don't think anybody could have foreseen an event like this.

Dabitch's picture

The paypal freeze or the flooding of New Orleans?

Because if you mean the latter, I'm guessing you're not a National Geographic subscriber. (linked is an article describing pretty much exactly what happened in New Orleans published October 2004)