PayPal Freezes MineCraft Dev’s 600k Euros

By Quintin Smith on September 10th, 2010 at 3:12 pm.

What's in the castle? Money, I suspect.

Sadness. According to a post on MineCraft developer Notch’s blog, PayPal have limited access to his PayPal account due to “a suspicious withdrawal or deposit”. That’d be the same PayPal account people drop money into when they buy MineCraft. In the post, Notch says that there’s more than €600,000 in there, and if PayPal decide something untoward is going on they’re going to keep that money.

This news comes hot on the heels of Notch stating his intent to use that money to start his own development studio, which could only be a huge boon for PC gaming. “I’m sure I’ll get it sorted out,” says Notch, “but this is kind of frustrating.”

In PayPal’s defense, a PC indie developer racking up 600 thousand euros is pretty suspicious, albeit only in a “What brand of racehorse steroids did Notch import that made him this amazing” kind of way. Notch! Our hearts and prayers are with you. Thanks to RPS reader Dan Lowrie for the heads up.

, , .

180 Comments »

Sponsored links by Taboola
  1. pupsikaso says:

    GET THE TORCHES, MEN! SACK THE PAYPAL INFIDELS!

  2. Tei says:

    I will send a email to paypal, asking for unlock him. :-/

    o7

  3. wm says:

    What? That’s surely not for PayPal to decide. The police, sure. But a private company? Sue them, Notch.

    • Ignorant Texan says:

      Under the US Patriot Act, it is their responsibility to with-hold the funds and notify the relevant authorities.

    • Rinox says:

      Under the US Patriot Act, just about anything is possible. :-(

    • Ignorant Texan says:

      To the eternal shame of me and my country, you are sadly correct, Rinox.

    • ezuz says:

      One of the reasons I have no interest to move, live or travel to the U.S.

      Can say the same for at least 15 other friends of mine.

    • Warskull says:

      This has nothing to do with the Patriot Act, Paypal has been pulling this bullshit forever. They play with their legal status since they technically aren’t a bank. They’ve been doing this forever, someone claims fraud, they freeze the whole account and keep all the money. They end up on the bad end of a lot of fraud and they way they make up for it is by keeping legitimate customer’s money.

      Example:
      http://www.somethingawful.com/d/news/further-proof-paypal.php

      I suspect Paypal will keep the full 600,000 euros. Hopefully, Notch can cause enough of a fuss to either force paypal to give the money back or sue the living crap out of them.

    • Ryan Curtis says:

      Paypal of course are not a US company .. albeit that they are a wholely-owned subsidiary of one. I think however that ebays eagerness to follow the Homeland diktat might make them forget that a seperate legal entity is a seperate legal entity and that Paypals first loyalty is to the government of the country in which it is registered.

  4. ChaK_ says:

    Well at least they control the money they “have”.

    i’m sure it’ll be solved in 2/3 mails

  5. Samuel Bass says:

    I find it odd that Paypal is often heralded as the harbinger of a “post-paper money / post-banking world” yet are about as opaque and unaccountable as any other financial institution.

    Here’s hoping Notch gets his hard earned zenny back.

    • Dinger says:

      I find it odd that people continue to use Paypal in both the payable and receivable directions. Seriously, you’re giving a third party access to your financials on the basis of a password and agreeing to let them do whatever the Hell they want with it?*

      *Also known as agreeing to resolve all differences via confidential binding arbitration.

    • Premium User Badge

      VelvetFistIronGlove says:

      No, they’re more opaque and unaccountable than many other financial institutions, as PayPal is not subject to many of the regulations that govern banks.

      Here’s another example of PayPal’s fine policies that happened to a friend of mine.

    • Wulf says:

      Yes, but playing devil’s advocate, in their favour PayPal are quite nutty about security, they don’t want to be the centre of a scandal, no company does. Therefore they keep a good handle on their site, which is more than you can say for most sites where you’d have to give out your debit/credit card details to pay. Frankly, between openly sharing my credit/debit cards where just about anyone can find them, and sharing them with PayPal who’re appreciably paranoid, I’d choose PayPal.

    • Butler` says:

      “Paypal’s outlook is that every single one of their customers is a liar, a cheat, and a thief.”

      Amen.

    • BAReFOOt says:

      As somewhat of an expert in psychology, I can tell you, that this is projection combined with the egocentric arrogance of a evil madman. Or in other words: They simply think that everyone must be like them.

      It’s like those who always think their partner cheats on them. Because they cheat on her/him constantly.

    • DJ Phantoon says:

      And justify their cheating with previously stated idea that partner is cheating on them, making it a game of revenge.

  6. Butler` says:

    Having dealt with them as a business in the past, PayPal will do what the hell they want. And in their own time.

    • Junior says:

      True, the key thing here, is that Paypal doesn’t want to steal 600,000 euros with the internet watching.

      RPS reporting on this story is just a small yet critical part of the process, things will resolve themselves neatly with the whole world watching.

      The important thing is that we don’t STOP watching these people who promise to care for our money.

    • Ezhar says:

      Same, after having been stung by their un-service twice (moving countries is not supported by their system for example) I’ve simply stopped using them for anything, even credit card payments though them. Yes that means I can’t buy some stuff like Minecraft, but look where that got them now.

      If you must use them, transfer the money into a real bank account the second it goes into their horrible system and never let any amount accumulate there – they just get greedy if you do.

  7. Stijn says:

    Huh. Surely you’d want to transfer the money from your PayPal account to your actual bank account every so often? It seems strange to let all that money just sit there.

    • Wilson says:

      @Stijn – Yeah, you would have thought, but I guess it’s one of those things where it’s easier not to bother, and you’ve got no reason to think of it as a concern. If Notch does continue on with PayPal after this is sorted, you can bet he’ll be more diligent about moving the money out in future.

    • Dean says:

      Maybe if we were talking a few grand coming in a few euros at a time… but over half a million in there… having some sense and not wanting to leave that sort of money with somewhere that gives you nearly zero rights over it is one thing, but not wanting the interest you’d get from having that in a proper bank account is shocking…

    • Kid A says:

      His account has actually been limited for a few weeks now, according to comments he’s made on Twitter and /v/ (yes, he posts on 4chan). That 600k (pre-tax, pre-PayPal’s cut – which they’ll still be taking after shafting him over) is from sales in the last 2-3 weeks. That’s the kind of money this guy is making.

    • Butterbumps says:

      Well, considering that one of the things involved in setting up this new studio he’s planning is hiring “a business guy”, I think we can assume this kind of fiasco won’t be happening in the future.

    • Ignorant Texan says:

      Paypal, while not a bank, falls under the US Patriot Act. With a name like Markus Persson, he obviously has ties to some freedom-hating terrorist group. That they are keeping his money and extending the float has ABSOLUTELY NOTHING to do with it, I’m sure.

    • qrter says:

      This surprised me too, who keeps 600k in their Paypal account? Especially when Paypal is pretty infamous for not being the most reliable company in the world. The internet is rife with horror stories about them.

    • YogSo says:

      @Ignorant Texan: “With a name like Markus Persson, he obviously has ties to some freedom-hating terrorist group.”

      As soon as he tells them where his sister Una is hiding they will give him the money back. Nothing personal, just bussiness. :P

    • Shih Tzu says:

      @Stijn – Actually, the dev says he was withdrawing regularly once a week. The $600K came in just recently due to a spike in sales (and presumably is what caused Paypal to limit the account), before he had a chance to withdraw. But yeah, this serves as a pretty good lesson to indies that Paypal is not your friend, or if it is, it’s your friend who’s always been kind of a dick and now has borrowed your car and crashed it into a tree while drinking.

  8. Rinox says:

    What? I was going to buy Minecraft tonight. Is it still going to the Paypal account or is there an alternative now? I don’t want to wait too long to craft my mine…

    • frymaster says:

      the 600,000 euros he’s talking about are what’s gone into his account in the 3 weeks since it’s been locked

      this means:

      a) you can still buy it, and

      b) he’s had an insane level of sales recently. 60,000 copies in under 4 weeks.

    • Rinox says:

      Yeah but I don’t really feel great about dropping more money in that paypal account when he can’t access it.

    • Premium User Badge

      lhzr says:

      i paid for MC more than 3 weeks ago. still got nothing and he didn’t answer to any of the 5 emails i’ve sent him. so yeah .. buying it won’t necessarily mean you’ll actually get to play it any time soon.

    • Casimir's Blake says:

      I had NO such problems, and in fact paid for the game twice. Yeah, I bought a license for a friend.

      On both occasions, the accounts were IMMEDIATELY unlocked and we were able to download and play the alpha.

      You do realise that you don’t actually receive a download via e-mail? You have to log onto http://www.minecraft.net with the credentials of the account that has paid for MC, and it will then tell you that you have a full account and have access to the alpha version (web or download).

    • Premium User Badge

      lhzr says:

      @casimir: yeah, this wasn’t the first copy i bought either. it was the third and didn’t have any problems with the first two purchases.

    • Casimir's Blake says:

      @lhzr: Ah context always makes a difference! I’m willing to bet that your third purchase may have been made while Notch’s server was heavily overloaded. I reckon he’s getting desperate to change it by now! Try and e-mail him again, but do check his blog, he’s been bloody busy lately: http://notch.tumblr.com/

  9. LeFishy says:

    He actually takes it out regularly. This sum has accumulated since the restriction was placed.

  10. OgTheClever says:

    As a matter of fact he was withdrawing from it weekly, it’s just that he’s been on trips for the last couple of weeks and this is the money which has only built up during this time.

  11. Hippo says:

    I don’t think people should start e-mailing PayPal. Not yet. I mean, if they decide to keep the money then obviously we should get medieval on their asses, but at the moment angry e-mails from a bunch of random internet people might only make the situation worse for him.

    • qrter says:

      I don’t think e-mails from anonymous internet people would help at any time, really. Why should Paypal care?

      At worst, it’ll be something that ends up in a courtroom, sadly. E-mails won’t help anyone there.

    • Mr. Brand says:

      I think an e-mail to Google Checkout, urging them to open up merchant business in more countries than the US and UK, would be an even better idea. It’s clear that PayPal won’t change.

  12. Derp says:

    Those 600k Euro is only the money he made in the past 3 weeks. His account has been locked for 3 weeks and is being reviewd. He made WELL over 600k euro in total. Anyway, there is a patch coming out tonight with compasses.

  13. Steve says:

    According to his twitter, he does withdraw everything every week. Sales have just been that crazy since they locked the account.

  14. Reapy says:

    This sucks… but I’ve been reading stories about paypal like this for YEARS, and I’m kind of shocked people still use them at all… but then again I’ve never set up anything that needed payment via the web, so maybe they are just too convenient or cheap to pass up.

    • Butler` says:

      They’re convenient but certainly not cheap, especially considering the beyond-terrible customer service they offer.

      What they offer is a household brand that consumers are familiar and comfortable with using to give money away to relative strangers.

      Which is why they do everything to protect that image.

    • Jon says:

      I’m afraid to say that I set up a PayPal website.
      The reason people choose PayPal is because there ISN’T a good competitor. About the only real alternative is Google Checkout, and they’ve matched PayPal’s pricing scheme, not improved on it.
      PayPal is the only company you can reasonably expect people on the internet to trust their money with for small to medium businesses.
      They also have a relatively easy to use API (better than Google’s), and a large amount of documentation (mostly as a result of their large number of customers).

    • DJ Phantoon says:

      Yeah but Google already owns all of your personal information.

  15. Ravenger says:

    There have also been cases of legitimate Paypal payments to Steam being reversed because of Paypal’s anti-fraud measures.

    Bad enough, except that if it happens Steam will lock your entire account until the dispute is settled. Some people have been in a catch 22 situation where both Steam and Paypal deny responsibility to fix it.

  16. salejemaster says:

    fuck you pay pal, serious like, I cant even BUY the damn game coz paypal doesn’t recognize where I live as a countrey, here’s to hoping the cup finally spills and he makes a diffrenent way of buying the game so I can finally play!!!

  17. Skurmedel says:

    I would be worried if I were in the same situation. Pay Pal has done some pretty shift shit towards other merchants in the past.

  18. Zyrxil says:

    Hopefully Google Checkout or Amazon Payments can gain traction and replace Paypal. Ebay is really such a piece of shit company these days.

  19. cliffski says:

    This kind of problem never happens with these guys
    BMT Micro
    and
    fastSpring.

    They are payment providers that provide services for indie devs. You can even phone them up and speak to real people. They take a bigger cut than paypal, but in my opinion, it’s worth it. I wouldn’t want a customer to have to ever talk to paypal about something, thats just asking for frustration.
    I’ve used about 8 different payment companies over the years, and I’ve found those 2 to be the best ways to getting money from direct sales.

    • Butler` says:

      Don’t you have enough of a sales history to set up a proper online payment system from a bank?

    • salejemaster says:

      @cliffski I think BMT Micro is preatty cool never had trouble buying games with that service!

    • pupsikaso says:

      But do those companies offer as many payment methods and in as many countries as PayPal? The reason why it’s so popular is because you can pay just about any way you can, and from almost any country.

    • Mr. Brand says:

      FastSpring offer all the usual cards and PayPal as options, but the money go into the seller’s FastSpring account instead. Then they can transfer to a real bank account (although I think PayPal is an option for the brave).

    • cliffski says:

      Thats the beauty of them. You can use BMT, and then handle paypal for you. So people who like paypal can use it, people who hate it, can use their credit/debit card or check, and you can get on with programming :D

  20. Emphursis says:

    Well, hopefully when he gets it sorted out and starts a proper company, he will be able to avoid PayPal completely and set up his own payment method.

  21. Ysellian says:

    A part of me can understand Paypal, but the bigger part of me doesn’t understand how paypal is even allowed to do this. Surely it’s the police that handles such tasks?

  22. Hippo says:

    What he should immediately do is to set up an alternative system and at least temporarily shut down the paypal option. Paypal is obviously convenient enough that it should remain an option (but only after this current mess is solved), but he’s selling 4000 copies a day at 10 euro per copy, and that’s 40 000 euro going into his locked account every single day. Not a great idea, considering Paypal _might_ actually try to grab the money.

    (that said, he can certainly afford a serious business lawyer, so he’s perhaps not that worried)

    (also, I certainly did not enter an incorrect captcha phrase)

  23. Sigma Draconis says:

    A dick move on PayPal’s part, but they’ve always been suspect. Though, I do expect Notch to get this sorted out without too much trouble.

  24. Davee says:

    Wow. I bought it late last night, it must have been a close call and among the last transactions :O

    And yes, PayPal is very suspicious. About anything that isn’t small sums – a mate of mine got a call asking if a 300(ish)-euro transaction he had made from his PayPal account to another place was legit/his intention or not – he said that it was and there wasn’t any more hassle – but still ;)

    • Ysellian says:

      It’s suspicious, but I must say needed for an online money payment service. All you need is a password from someone and he could go off with hundreds if you’re not paying attention. My creditcard company calls me aswell when things seem a bit iffy.

      But this seems a bit different. This seems like Paypal think the guy from Minecraft is the criminal.

  25. ScubaMonster says:

    How convenient for PayPal. That’s an easy 600K euros in their pocket.

  26. ScubaMonster says:

    If PayPal keeps the money I hope he sues them. That is wrong.

  27. Navagon says:

    Bloody unbelievable!

    Well, not totally unbelievable. This sort of behaviour is why I never leave any money in my Paypal account. Online purchases result in the funds being taken from my bank account. You simply can’t trust Paypal, even if there is seldom any better alternatives but to use them.

  28. Kazang says:

    What the deuce?
    600k in 3 weeks? That’s and obscene amount of money for a one man show indie game.

    I can see why they would be suspicous as I’m sure paypal and such systems are regularly used for shady shenanigans.

  29. JohnnyMaverik says:

    I’m sure it’ll be unfrozen soon, PayPal aren’t going to keep the money, not only because it’d be very bad press for them, but also… well why would they want to? This kinda shit is normal.

  30. ReV_VAdAUL says:

    Hopefully Paypal will sort things out soon but don’t be certain they will, as with the Something Awful thing mentioned above they may decide to simply refund the money to customers and cause notch a whole load of hastle.

    Also Paypal’s CEO seems to be a bond villain: http://www.alternet.org/story/147058

  31. Freud says:

    I can’t imagine it will be a problem. That’s why Notch is such a perfect front for Al Qaida.

  32. Lukasz says:

    I am not surprised that happened.

    We are talking about 600K euro made in 2 weeks or so. By a single person.

    Of course they were worried. If it is a fraud they are gonna pay. Not a person whose paypal account was stolen.
    This happening is one of the drawbacks of having high consumer protection on your bank accounts.

    Hopefully Paypal resolves it in timely fashion (and i mean a week or less)

    if not then torches and pitchforks gentlemen!

  33. A-Scale says:

    600 fucking thousand Euro? WHAT? How did he make that much with a relatively unknown indie game?!!?

    • ReV_VAdAUL says:

      While it has been consistently very popular I believe a guy who does Modern Warfare 2 youtubes or something with thousands of viewers started doing minecraft videos and a lot of his views liked what they say, spurring the €600k in 3 weeks of sales.

    • Vinraith says:

      It was the subject of a post on the TF2 blog, as well, which increased its exposure considerably. Even before that, though, it’s one of the better known indie games out there simply on word of mouth.

  34. Bas says:

    I just bought access to Minecraft yesterday. That must have been the final straw, sorry for destroying your financial security, hopes amd dreams Notch!

    • Navagon says:

      Dammit, Bas! Why did you have to turn out to Osama Bin Ladin in a dress?!

  35. Brumisator says:

    SO… paypal police themselves and their users… and can decide to KEEP THE MONEY FOR THEMSELVES?

    WTF!!!???

    • Dark_Oppressor says:

      Relax. Paypal is looking into it and will take care of everything. Just relax… that hold…. on all your monies…

  36. Vinraith says:

    This kind of thing is actually why I generally like Paypal. They have very tight security, which has saved me account from being stolen on at least one occasion, and their fraud resolution system has gotten me back my money from a number of bad ebay deals. I can understand why this amount of earning, in this amount of time, would read to them as suspicious. I’m sure it’ll get worked out, I don’t know what this hysteria about “Paypal keeping the money” is but it’s baseless. For one, they’re not crooks, and for another, they’re not idiots. They know that’d be a PR disaster, even before it was a legal one.

    • Ysellian says:

      yeah I’m pretty sure a service like paypal is worth more than 600k.

    • Jake says:

      I do most of my business through paypal and I really like the service, it’s fast and convenient, a lot more so than international cheques etc. But then again I have never had a fraud problem, and certainly never lost any money, if I did, that might change my opinion pretty quickly. I would expect this issue to be resolved pretty quickly though surely.

    • Brumisator says:

      You know, Justice is about stopping evildoers and not harming innocents.

    • caesarbear says:

      “I don’t know what this hysteria about “Paypal keeping the money” is but it’s baseless.”

      Not at all. PayPal’s business is cash flow. They don’t make their real profit from penny and schilling (?) their customers. Providing 600k in liquidity, even if only for a month, reaps interest. One easy way for PayPal to hold on to the cash that flows through them a little longer is to claim fraud concerns. Think about it. What actual work is PayPal doing right now to “investigate” Markus Persson and Minecraft.net? If they really wanted to know they could contact authorities. After that, what possible steps could they take in determining Notch’s criminality? Hire a private investigator? They’re doing no such thing. This is a memo sitting on some bureaucrat’s desk and it doesn’t get resolved until that bureaucrat arbitrarily decides to release the account. Background checks take days. This is clearly a cash grab.

  37. Mugi says:

    Been there., done that, lost that. Granted me it as not a loss of 600k $ it was a loss of 1500$ For me back then it was ALL money I had, was almost driven out on the street as yes this was a payment from an registered US company to me. They had problems sending international bills so they asked if they could pay me over paypal, which I agreed to.

    When I got the payment paypal blocked my account instantly and talked about money laundry and so on. Yeah the job was a serious one for a mayor gaming site.

  38. burglebox says:

    Go here and log in to help support our buddy Notch:

    https://www.paypal-community.com/t5/Watercooler/Markus-Persson-creator-of-Minecraft-has-funds-wrongly-frozen-by/m-p/98902/highlight/false#M2897

    The more publicity this gets the better. I’ve never heard of a credit card scammer or identity thief getting the support of 130,000 plus fans (and legitimate customers)

  39. Dalai says:

    PayPal complaint filed.

  40. bananaphone says:

    Was going to post the same link.

    They really are an awful bunch of shits.

  41. fartron says:

    Since Notch isn’t in the US, the patriot act applies neither to him nor his banking in this case.

    • Ignorant Texan says:

      Since Paypal is based in the US, I’m sure they are not taking the chance.

    • Alexander Norris says:

      The US doesn’t actually care what the legally-defined boundaries of the USA are, nor do they give a shit about anyone’s sovereignty except their own, in case you hadn’t noticed.

    • Ignorant Texan says:

      As Mr Norris states, and since Notch and his business are not based in the US, and Paypal is, it does fall under our Orwellian-named US Patriot Act.

    • caesarbear says:

      I hate to bust up the Ameribashing, but this “investigation” was not initiated by the US government. It was PayPal. The Patriot Act forces companies to comply when the government asks. No business or person has to worry about complying with the Patriot Act during normal business activity. If anything, the Patriot Act in this case should help PayPal recognize whether Notch is a money launderer. Not that I’m a fan of the Patriot Act, but this is entirely the arbitrary will of PayPal.

    • Ignorant Texan says:

      Transfer of money involving 10k and up USD require notification of US banking authorities. The relevant statue was passed during the Reagan Administration as part of the War on Drugs. As an United States citizen who has had to deal with this personally, I can attest that it involves a hold, usually 7-10 days, while they wait to hear if it is a legal transfer. Money transferred to a foreign national is not exempted. While I’m sure that Paypal is not unhappy to have the float they currently enjoy during the required notification process with Notch’s money, they also have a firm legal justification in this matter.

    • caesarbear says:

      All of those notification laws existed before the Patriot Act as you mentioned (and exist in most Western countries btw.) The Patriot Act if anything, should expedite the processes, not turn 7-10 days into 3 weeks. The law is being used as smoke screen in this case.

    • Ignorant Texan says:

      Oh, I wholeheartedly agree that Paypal is doing what they can to avoid forking his money over for as long as they can. Notch can easily prove he’s not part of some ‘criminal’ or ‘terrorist’ organization. Paypal is not a bank, they aren’t subject to most US banking laws. They are subject to state laws and the Patriot Act. The whole Patriot Act sub-thread began when people asked how Paypal could justify playing ‘police-man’.

    • elmuerte says:

      Notch is from Sweden, and thus most likely using PayPal Europe, which is a actual bank based in Luxembourg.

  42. distrbnce says:

    BRB mining coal

  43. Prophet19 says:

    I say we bomb paypal’s e-mails/phone lines with complaints lets show them who there dealign with.

  44. Hippo says:

    I just discovered that I can move lava around in buckets, like water (and create lava springs). I’m getting all kinds of weird ideas now…

  45. Lucas says:

    Step 1: don’t do business with PayPal!

    I did buy Minecraft because they just acted as the credit card middleman, but I refuse to open an account or otherwise do business with them. I hope Notch gets this sorted out ok and then jumps ship ASAP.

  46. PHeMoX says:

    I hope he’ll get that money back.

  47. Nick says:

    @lhzr
    minecraft.net
    login
    download

    You’re welcome.

    • Premium User Badge

      lhzr says:

      uh, thanks, but as i replied to casimir, having already gotten two copies of mc, i know how the process should work. thing is, it doesn’t.

  48. Jeroen Beekman says:

    It’s already going on for two weeks.

  49. olybenjamin says:

    My paypal account was frozen with $600 in it for “suspicious activity” I haven’t used it since. PayPal is a shady, terrible way to do business and if you’re keeping money in it I strongly recommend removing it as quickly as possible.