Paypal Shafts Indie Developer, Withholds Donated Money

It was one of the year's feel-good stories when Lab Zero Games raised over $800,000 so they could make more content for indie fighting game Skullgirls.

It's one of the year's saddest stories, then, that Paypal is being really weird with the studio's money.

Most of the contributions to Lab Zero's IndieGoGo campaign were paid via PayPal, but given the size of the amount, the net payment giant wanted the Skullgirls developers to "take on the risk" if a large number of backers decided not to actually pledge. Something the studio obviously couldn't do.

So PayPal froze Lab Zero's account, locking them out of their cash and preventing employees from being paid (part of the cash was to pay the wages of the developers needed to create the content).

Following complaints, including one lodged with the Consumer Financial Protection Bureau, PayPal have since opened up the account, though they're still holding $35,000 as "collateral".

Skullgirls DLC Character vote | The Campaign united us, The Voting will destroy us [NeoGAF]

Skullgirls funding held by Paypal [GI.biz]