Frozen Account Sours PayPal's Reputation With Indie Devs

For the third time in about a year, PayPal has frozen the account of an independent developer for six months, presumably because preorder activity triggered red flags. PayPal rarely says why in this case, even to the account holder, leaving its actions to appear arbitrary and bureaucratic, if not portrayed as mean-spirited.

Minecraft had $US750,000 frozen last September; the makers of Project Zomboid had their account locked in May, requiring a clever workaround to get the game to customers. Now Xenonauts, the X-Com remake, has had funds frozen for 180 days.

Developers Goldhawk Interactive say only $US4300 is locked away from them, and that the amount does not threaten completion of the game. That's not to say they don't need the dough.

"There's enough left in our corporate bank account to get the game finished," designer Chris England wrote on the Xenonauts site. "Whether we'll be able to implement all the 'nice-to-have' features on that budget (such as our new UI style) remains to be seen, but we'll be able to complete it to the original spec on the funds we currently have.

"However, losing our only source of income is obviously going to be disruptive to the project, as we were getting a good source of income from pre-orders up to this point," England said. "It's also not the ideal way to mark the start of my full-time work on the project. However, I'll keep you guys posted on how things turn out."

Independent games developers aren't necessarily targeted or monitored by PayPal. Craft sellers and eBay vendors have also complained of the same sanctioning. But games developers they do tend have robust communities that pay attention and publicise — loudly — occurrences such as these.

At any rate, to the gaming consumer, this has little direct effect other than to engage their outrage and sympathy. Goldhawk will honour all preorders; demanding one's money back from PayPal is probably not a good idea as it seems to confirm their belief that suspicious activity was taking place.

Enemy Known: Xenonauts vs Paypal [Rock, Paper, Shotgun]


    In australia boy paypal is a nightmare when u reach past the thousand point due to stupid money laundering and anti terrorist funding laws. Paypal locks your account and then forces you to provide a range of personal information, is this the issue?

    Simple. Dont.use.paypal.

      Use what instead?

        you're welcome!

          Hey, yeah... no.

          Brief glance tells me that all of these "options" fail the ubiquity test.

    It would take less than a couple minutes to google the company and see that these were indie game developers. How lazy is paypal?

    Ever since i started using Paypall a couple of years ago, i haven't even had one problem with it.

    I don't see the need to change. However, i guess i'm not the one that is getting over 9000 dollars in my account.

    They really need to be regulated by the government, like a bank.

    Or, maybe existing laws are able to get them; they just need to be taken to court.

    pretty sure it's illegal to freeze funds without informing the account holder as to the reason why. That money in the account is legally their property, and what paypal is doing is tantamount to theft...

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