Why do I use such harsh words about an entity that I have fondly described as “making JPMorgan Chase look like a community bank’?

The story starts at the need to hold my high school graduating class 25th reunion. After steering committee conference calls, a survey out to classmates and the selection of an online event registration system (Eventbrite won out over Eventbee), it was determined that we needed a PayPal account to take in all of those electronic payments that would be created during the registration process for our 25th reunion soiree.  So, our plan of attack was IRS Tax ID, bank account at TD BankNorth and finally, the PayPal account.  I thought the last of those options would be the easiest.  Then again, I also thought that Darren Stevens on Bewitched was straight.

Having opened a few PayPal accounts in my day, I knew to have my ducks lined up in a row. I had Tax ID, address, bank account info, etc. The challenge started when one is forced to categorize themselves as an entity and  in a pseudo-MCC exercise, but beware, instead of the thousands of MCCs, PayPal has like 22 categories – and if you don’t select the right one, the wrath of Meg Whitman comes down upon you.

When looking at the five choices to start with, I knew that we were not incorporated, we certainly were not a Government Entity, and the Tax ID did not correlate to Individual, Sole Proprietorship or Partnership, so I selected Non-Profit Organization (which theoretically, we are, according to IRS rules we don’t have to file a tax return unless our revenues are above $25,000).

The next step in the “Quest for Confusion” was to select the category, of which PayPal presented us with 27 (TWENTY-SEVEN) options.  Twenty-seven.  Vingt-sept, if you’re in Paris. 

 So, of the 27 categories, I found no ‘club’, no ‘social organization’, nothing.  I again was forced to select “Nonprofit”.  Now, I wasn’t looking for a special rate because of this ‘nonprofit’ status (which apparently is 2.3% instead of the standard 2.9%), I just had no other selection as an option.  So that’s when the fun began:

Dear Noble 1985 Alumni Club,
As part of our security measures, we regularly screen activity in the PayPal system. During a recent screening, we noticed an issue regarding your account. PayPal requires accounts within the charity / non profit category to provide us with some additional information regarding their organization. Upon a recent review, your account was identified as falling within this classification. Until we can collect this information, your access to sensitive account features will be limited.  Please take a moment to provide us with this information so that we can restore your access as soon as possible.

After providing a bunch of documentation and requesting that they disregard the nonprofit designation, I received another mainframe-generated email:

Hello Noble 1985 Alumni Club,
We are writing to you in regards to your PayPal Account.  PayPal appreciates that you have chosen us to accept payments for your organization.  As part of PayPals Compliance Program, we request that entities wishing to accept donations on behalf of a charity or other non-profit organization provide evidence of their legitimacy.  Please provide the following information:

1.  Evidence of tax-exempt status and/or registration with any applicable regulatory bodies governing your jurisdiction.
2.  A valid URL for the organization
3.  A brief organizational summary or Mission Statement.

My response to PayPal (showing the stress of a class reunion only a month and a half away):

Noble High School 1985 Social Club requests that you change our status (or request) from non-profit to ‘profit’ so that we may begin accepting payments through PayPal.  We will not be pursuing a 501(c)3 designation at this time due to the expense and time constraints. We are simply an organization that is arranging a 25^th class reunion.  Could you please remove the limitations on this account so that we can move forward.  Your bureaucracy makes Chase look like a community bank.

Regards,
Noble HS 1985 Social Club

FYI, apparently when you compare PayPal to the most hated bank in the country, they lift your limitations within 24 hours. So for those of you reuniting in the future and looking to accept electronic payments, it’s good to use the terms “Bureaucracy” and “Chase” to get things done in PayPal-land.