Stripe holding $47K for "elevated risk" — been 4 months, what are my options?

Really hoping someone here has been through this because I'm losing my mind.

I run a small SaaS for real estate agents. Been using Stripe for about 18 months, processing maybe $30-40K/month. Chargeback rate under 0.3% the entire time. Then in June, out of nowhere: "We've identified elevated risk associated with your account." No specifics. They said they'd hold funds for "up to 90 days."

90 days came and went. I've sent probably 15 emails. Every response is copy-paste garbage. It's now been 4 months. They're holding $47K of my money. Had to take out a personal loan to cover expenses.

What actually works here? CFPB? Demand letter? Arbitration? I can't afford a lawyer but I also can't afford to lose $47K.

Went through this last year with $31K. CFPB complaint did nothing. Demand letter got a slightly better response but still no release. What actually worked: filing for AAA arbitration. Got my money within 2 weeks of them receiving the demand.

Following this. Same boat, 6 weeks in, $22K. The anxiety is unreal.

I've dealt with a bunch of these. Quick rundown:

Check Section 13.3 of Stripe's Services Agreement - mandatory arbitration clause. Before you can file arbitration you have to give them 30 days notice. So step one is a formal demand letter citing that section. Send it certified mail to their legal dept at 354 Oyster Point Blvd, South San Francisco CA 94080, and also email complaints@stripe.com.

Include specific amount held, timeline, your low chargeback rate, and state you'll file for arbitration if not resolved in 14 days.

One more thing - under their agreement Stripe pays arbitration fees for claims under $75K so the actual filing only costs you around $200. The threat alone resolves like 40% of cases I've seen. Stripe's legal team actually reads demand letters unlike support.

@SarahE_Counsel thank you. Do I send the physical letter AND email, or just one?

Both. The physical certified mail creates a paper trail and shows you're serious. Keep the tracking receipt.

@MikeK_Founder when I filed arbitration they reached out to "discuss resolution" which basically meant "we'll release if you withdraw." Got it in writing first obviously. No apology, no explanation, just corporate speak about "completing their review." Whatever, got my money back.

Once you have it, move to a different processor. I use Helcim now.

Not legal but business advice: set up a backup processor NOW before you need it. I have Braintree configured and ready to go. Costs nothing until you use it. Also sweep to your bank daily so they can't hold much if they decide to freeze you. The "elevated risk" thing is often triggered by algorithm, not human review. Doesn't matter if your metrics are perfect.

Good thread. The strongest legal claim here is usually conversion - Stripe is exercising dominion over your property beyond what the contract allows. Their agreement lets them hold funds for "reasonable" periods but 4 months with a 0.3% chargeback rate isn't reasonable.

Mike, start documenting everything now - the loan terms, lost opportunities, all communications. You'll want a clear damages calculation if this goes to arbitration.

small claims won't work btw, they'll invoke the arbitration clause to dismiss. also $47k exceeds the limit in most states anyway

UPDATE: Sent the demand letter last week. Got a real response within 4 days (not copy-paste). They're now saying they'll release in "2-3 weeks pending final review." Still vague but at least it's movement. Giving them until Nov 10 before I file.

nice! fingers crossed. sending mine tomorrow

GOT IT BACK. $47,247.82 hit my account yesterday. No additional communication, just the transfer. About 3 weeks from demand letter to funds.

Moving to Square as primary, keeping Stripe as backup only. Never keeping more than a few days balance in there again.

Thanks everyone.

Just found this through google. Same situation, $18K held 2 months. Sending the demand letter today. Thanks for documenting everything.