After being throughly trashed by crowd sourcing techies here and everywhere for freezing the paypal account of Regretsy.com, PayPal has issued a statement acknowledging the error of their ways. Calling it a "resolution", Anuj Nayar, Director of Communications, PayPal writes:

Last night we became aware of an issue with one of our account holders, Regretsy.com. Though we can't comment specifically on the account due to our privacy policy, we can confirm that the funds have been released and we are working directly with the account holder on this matter. Just like anyone else, we believe strongly in helping those in need, especially around the holiday season. We are making a donation to Regretsy to help their cause, and we're truly sorry this occurred.

For background, we have clear guidelines for any business that uses PayPal to accept donations. For example, we require certain documentation to prevent misuse of the donated funds and, if the recipient claims charitable status, to determine whether they are properly registered. We do this to protect our customers and to protect our business. As a regulated payment service, we're also required by law to follow these guidelines.

We appreciate that this can be an inconvenience, but we have a responsibility to all our customers - both donors and recipients; and buyers and sellers. In this instance, we recognized our error and moved as swiftly as possible to fix it.

First up Paypal... The only reason Regretsy still has an account is the ridiculous list of conditions attached to closing the account... besides it was frozen.

Secondly... Regretsy doesn't need your money. They raised enough of their own

Thirdly... Resolutions are made at New Years. Need a suggestion? How about this year I resolve not to be such a douche bag

Fourth... No, actually, you don’t have clear guidelines regarding businesses accepting donations to perform charitable acts. “Subject to review” is pretty much the same as “depends on which way the wind’s blowing”

Next.... What an marketing opportunity for another online payment company... Are you listening Google Wallet

Meanwhile, over  at  web host Hostropolis , Regretsy.com server continues to contend with the little extra load.