Help- Etsy refunded completed orders

[PinCoStore]

Hi!

In November 2024, we received notification that we needed to confirm ID with Etsy.

Me and my sister jointly run the business, so we decided to change the account to her name. We submitted both IDs via the online portal within the 60 day timeframe. When we called Etsy as we had not received any money into our bank account, they said not to worry as they were sorting the issue. Unfortunately in Jan 2025, Etsy put our store in vacation mode, and refunded all completed transactions from November 2025. 

When calling Etsy, they asked us to resend the ID instead via email rather than via the online portal, which we did. The account was now verified, but the funds that were previously on hold in our account has disappeared (Etsy used this to refund buyers for completed orders). This is a loss of over £800.

I have tried several times to call/email Etsy, but they are unable to help. All they advise is trying to recoup the money from buyers by messaging each one individually (over 50 orders). 

1. Why did Etsy automatically cancel all completed orders and refund buyers? Etsy can keep funds in their account upto 180 days, so do not understand why after 60 days, this happened.

2. Where in Etsy’s T&C’s does it mention refunding completed orders if ID is not verified? We were never told this in email or phone correspondence, nor is it found anywhere on their website.

3. Why is Etsy making me recoup funds from sellers? As stated above, the 60 day deadline only breached due to Etsy’s fault in their online portal, which they acknowledged. We submitted all documents within the timeframe, and they were able to see this on their side.

Has anyone been successful in requesting and receiving funds inappropriately taken by Etsy?

Thanks

[CoquetteBath]

well, it is never been permitted to change the ownership of a shop.

so doing that may have been the first mistake.

you can/could have shown your sister as a shop member, but as a co-owner, I think that's not permitted as a change.

Only Etsy can determine why your orders were refunded. I also see a few other concerns (to me) but since that's not the ask...not sharing.

good luck resolving this.

[GroundZeroCreations]

This is very strange. First, to the best of my knowledge Etsy does not allow ownership of a shop to be transferred to another person. Even though you say your sister and you both run the shop, changing the name of the owner is not allowed. This is what Etsy policies says:

"Can I Transfer My Etsy Account to Someone Else?
No, you can’t transfer your Etsy account to someone else. If you have sold the business you run on Etsy to someone else, you can’t transfer your Etsy account to the new owner. Instead, the new owner must open a new Etsy account and shop.

We recognize that it's not uncommon for a small business owner to buy or sell a business. However, for security reasons and legal requirements, account transfers are not permitted on Etsy, as outlined in our Terms of Use.

If Etsy believes that an account transfer has occurred, the account may be suspended without notice."

So trying to do that may be why you are experiencing this problem. 

[bradgoodell]

Ouch!  As the others have said, Etsy doesn't permit the transferring of shops.  By attempting to do so, you triggered rules and regulations of the INFORM Consumer Act.  That makes your shop appear to be operating illegally.  Which triggers Etsy to refund your customers.  

Unfortunately, I don't think there is a way to fix this.  

[Adorabilities]

If they think it's operating illegally, wouldn't they close or suspend the shop?

Also, being advised to contact past customers to get payment for refunded orders is very strange advice.

[bradgoodell]

@Adorabilities  Just realized the shop was still open, so that is pretty odd.  

[GlassyFields]

I'm sorry this happened to you.

As others have said, Etsy does not allow transfer of a shop ...

Among other reasons, that makes sense for security reasons (bad actors might be able to use as a loophole to take over shops)

It's a pricy lesson learned

My SIL and BIL make gorgeous and exceptionally well-crafted jewelry but are not interested in selling online. We've toyed with the idea of selling in my store and always decide it's just too problematic ... any proceeds would look like income to me for tax purposes plus it would be selling items not made by me (I suppose I could list them as shop members. I'd have to do all the selling work (photography, listing, responding to messages, packaging/shipping) or give them my Etsy password which is a risk to me. (I trust them but what if they made a mistake that affected my store ... now what ... what if I made a mistake relating to one of their items).

Etsy just isn't set up for dual ownership.

I think I get where you were coming from. A project with my sister sounds like fun. 

I hope the lesson learned benefits both of you going forward.

[irmaKdesigns]

@PinCoStore "When calling Etsy, they asked us to resend the ID instead via email rather than via the online portal, which we did."

Etsy has no phone support.

Has anyone verified ID lately and could confirm it's via email, not Etsy portal? Possible scam?

As others have mentioned, Etsy doesn't allow account transfers, yet your shop is opened, which means Etsy verified your sister's ID and allowed the transfer? (???!)

[PristinityJewelry]

Yeah, there is a lot about this one that is tripin' my radar.

[PinCoStore]

Hi all

Sorry for not clarifying! No, I resubmitted my ID and the account and profits are all under me. There is no longer dual ownership of the business and she is no longer part of it.

The shop is open as I have kept it under my name.

Etsy does have a callback service on their website, so yes. I did speak to Etsy Support and they asked me to submit the documentation via email. Once I did this, the shop was re-opened.

My questions aren’t about the shop ownership, but assistance with the orders that Etsy refunded that had already been completed. I am still no nearer to getting this resolved.

[GroundZeroCreations]

@PinCoStore 

You initially mentioned that you and your sister jointly run the business and decided to transfer the account to her name, submitting both IDs through the online portal within the 60-day window. Now, you’ve resubmitted everything, and the account is solely in your name. It’s great to hear your shop is active again!

Regarding the refunded orders Etsy issued, it’s unlikely you can recover those funds. Be cautious about following suggestions from Etsy’s seller support, as they rely on a third-party company that often lacks knowledge of Etsy’s policies.

After extensive research, I found no indication that buyers are legally required to reimburse sellers for refunded orders in the U.S. Attempting to pursue them for payment might even lead to reports of harassment.

Unfortunately, this seems like a loss you’ll have to absorb as part of doing business. It’s frustrating and unfair, but sometimes there’s little we can do.

Wishing you the best of luck!

[CraftyCornishMaids]

Etsy can only pay money to verified accounts

They gave you 60 days - so 60 days it is.

Etsy are not allowed to keep it, so they refunded the buyers

Your dispute is with etsy, so you can try to appeal, but as you tried to change the owner of the account, which is against etsys policies, then I don't hold out much hope.

[PinCoStore]

Hi!

As stated, I resubmitted my own ID several times via the portal within the 60 days. Not my sister’s. Even if transfer was requested, this didn’t go though, so wouldn’t be contravening policy.

A comment above states not to use advice given by Etsy’s seller support as they are a third party and unaware of Etsy policies. This is a company contracted by Etsy. It doesn’t make sense that a seller wouldn’t listen to the advice they gave!

How would I appeal this decision directly with Etsy? Will I need to file a claim in the UK for the loss of funds? I have emailed and called so many times, but have not received any response. The customer service is truly shocking!

Thanks