Dreams, falling: PayPal freezes Dreamfall Chapters funding

PayPal is doing their best to garner as much positive press as possible right now, by… oh. Hahaha. No, they’ve just screwed things up again.

Judging by the Twitter feed of Dreamfall Chapters developer Red Thread Games, PayPal has frozen that particular company’s account and is refusing to release the money donated towards them through PayPal… until the game actually comes out. Which is amazing, considering that’s basically the opposite of how crowdfunding is supposed to work.

“I’m not sure it’s legal, but they’re trying to hold the money until we ship. Luckily we’re in a good place financially,” read one Tweet four hours ago, which unfortunately did not signal the end of Red Thread’s woes.

Since then, the team has apparently had to dig through the internet in order to find a number to actually call to reach customer support, but this still didn’t resolve the issue. On the upside, recent Tweets have been more encouraging – one of them reads “Another #JOURNEYCON update! @AskPayPal has been in touch & hopefully we can continue ticket sales soon. We will update again in the morning.”

So, hopefully, this won’t be the longest journey for The Longest Journey‘s episodic sequel. Unfortunately, they’re not alone in this – Nyu Media’s Yatagarasu recently hit similar problems, with PayPal considering the money “reserved” and refusing to release most of it until they had verified copies of paid invoices post-release, and I’m damn sure I’ve heard about other crowdfunded games slamming into exactly the same hurdle in the past. Skullgirls was just one of many. SomethingAwful’s fundraiser for Hurricane Katarina victims went the same way. This is, obviously, unbelievably idiotic.

I can understand PayPal’s desire to protect customers when you factor in both money laundering and rip-off campaigns, but there has to be a better way to deal with these things than to lock off the accounts of anything that raises a fair bit of money (while presumably earning interest on said money), make it almost impossible to resolve the issues, and only sort it out when a media shitstorm arises – and yet this seems to be PayPal’s modus operandi. I understand that crowdfunding is a new thing, and that people not delivering on their promises is a possibility, but when companies (and, indeed, charities) are relying on the funds raised to deliver what they’ve promised… well, it’s a completely unacceptable state of affairs.

On the other hand, everyone could just stop using bloody PayPal. I realise that’s not always a possibility, but it looks like the alternative is going through hell to get your money.

UPDATE: PayPal have responded by offering us the following statement:

“Our Customer Service team reached out to Red Thread Games and we’re pleased to report that the issue has been resolved. As we’ve mentioned before, PayPal is still working on our process to best address the needs of crowd funding businesses while adhering to laws and regulations around the world. It’s a top priority for us to get this fixed once and for all.”

We can but hope this actually will be fixed before long.