[s-cars] Fw: Paypal

[ccohen5]

Bingo - some of that float is in Paypal's accounts for at least a day,
sometimes more, especially with foreign transfers and drafts.

Colin
----- Original Message -----
From: "Kirby Smith" <kirby.a.smith at verizon.net>
To: "Brett Dikeman" <brett at cloud9.net>
Cc: <QSHIPQ at aol.com>; <ccohen5 at compuserve.com>; <s-car-list at audifans.com>;
<quattro at audifans.com>
Sent: Friday, May 03, 2002 9:03 AM
Subject: Re: [s-cars] Fw: Paypal


|
| Interesting.  I was under the impression that Paypal transfered money
| from one credit card account to another.  Other than the float
| surrounding transactions in progress, why would Paypal need to hold
| cash?
|
| kirby
|
| Brett Dikeman wrote:
| >
| > At 7:10 AM -0400 5/2/02, QSHIPQ at aol.com wrote:
| >
| > >The advent
| > >of the paypal debit card (US only) just adds icing to the cake, in
under 1
| > >hour, anyone can have US dollars in hand from a UK/EC paypal payee.
| >
| > Yes, but there's this minor little problem.  Paypal isn't a
| > bank...which means they're not under a single item of federal bank
| > regulations, and further, your deposits are NOT FDIC INSURED FOR
| > -YOU-.  If the bank where Paypal stores your money goes under,
| > great...Paypal is covered.  If Paypal itself goes under or is cooking
| > the books(or has an accounting failure/problem), FDIC insurance won't
| > do you a damn bit of good, because it's a pooled account, and the
| > FDIC insures it for Paypal, not you.  Paypal states this, along with
| > the fact that they "believe" your money is safe from creditors.  Any
| > time you see fuzzy language in a legal document or PR statement,
| > warning bells should be going off left and right.
| >
| > IF(and I repeat, IF) Paypal went belly-up tomorrow, you'd be in a
| > very uncomfortable position.
| >
| >    Pretty unlikely(I really doubt paypal is going anywhere any time
| > soon, they seem to be doing quite well), but nothing's for sure in
| > this world.  The CFO where I used to work came from being CFO at a
| > company that tried to do the same thing as Paypal but
| > failed...probably because they didn't have a prayer with PayPal so
| > well established in the market.
| >
| >    I don't recall the company name off the top of my head, but
| > basically, a whole bunch of people lost everything in their accounts
| > because the company suddenly stopped accepting transactions and
| > stopped answering the phones/email; people simply couldn't get to
| > their money.  Some got their money back(I think people who noticed
| > things going sour and called right away did, and then they completely
| > stopped answering the phones, gee, I wonder why)...but a number of
| > people didn't, and the whole thing was very slimy.
| >
| >    At least when a bank shuts down, your deposits are insured AND it's
| > YOUR account, not a pooled account that belongs to someone else(who
| > no longer exists or is being pursued by creditors, etc)...with a
| > private company, all bets are off; sure, they might break laws and
| > get caught, but you'd never see your money again.
| >
| > Brett
| > --
| > ----
| > "They that give up essential liberty to obtain temporary
| > safety deserve neither liberty nor safety." - Ben Franklin
| > http://www.users.cloud9.net/~brett/
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