You are completely right. The problem is certainly not "fraud monitoring", and it's not a problem specific to Paypal either.

The problem is in the attitude. Being French, I'm well-trained in dealing with soulless bureaucracies; but with the French administration (or probably any public administration in most countries) there is always a way to escalate the issue; and if you were right, you very usually win.

But these companies are judge, jury, police and executioner. This can't go on forever.