I'll post the full update from elsewhere.
"I recently sold a rifle on Gunbroker and used Square to accept payment for the rifle.
My funds had not been deposited into my account in 7 days.
I emailed them asking why and here is what they said...
"I apologize for the delay in reaching out to you. There was some research I had to perform regarding your account. Everything appears in order however, the transaction you recently processed for the firearm sale on Gunbroker.com is the reason your account was suspended and referred to my desk. Section 6 of the Merchant User Agreement which prohibits Internet, mail, or telephone order transactions for firearms or weapons. Those types of sales put a stop to all deposits.
Because this transaction for $1625.00 was for a firearm that was sold when the card was not present, I need to ask you to agree to abide by the Agreement and no longer process transactions of this nature. All you will need to do is respond to this email agreeing to no longer process mail, telephone, or Internet transactions of this type using Square. You can use Square for any other type of transaction not listed in the section I referenced above.
To read more about the User Agreement, please see: https://squareup.com/legal/ua
Please respond before 4 pm PDT tomorrow (Friday) since I do not work weekends and would like to help you resolve this matter quickly. You can respond after that but I only check email once on Saturday and Sunday. I appreciate your patience and cooperation throughout this inquiry.
David Square Account Services"
"And the email I sent back
I do not understand why there is a restriction on a legitimate sale of an inanimate object. I think this is absolutely ridiculous.
I agree to not use Square for this type of sale ever again.
But I also agree to never use or recommend this service again.
I thank you for your time, and understanding."
Here is their website
Here is their Support Email
I will update when I get an answer back.
Small Edit: I wrote this in a comment below. I feel it adds to this.
People vehemently avoid PayPal because of their history with firearms.
I am merely trying to point out the obvious.
I have the possibility of loosing quite a good bit of money from this little predicament I find myself in.
Here are two quotes from people on other forums that add to the aggravation.
"This is odd because my local forum just had a group buy of 100 AR15 lowers @ $250ea go through without issue with Square.
It wasn't with GB but with a firearms manufacturer."
"Never had an issue with square and I'm an ffl.
I swipe and punch stuff in manually. When we switched to square we made it very clear what we were and what we sell and they were ok with it."
Now, if they are bothering me about this and those two are fine I have a HUGE
problem with their business practice.
They have unfroze my account.
This is a response to an email someone sent in
We regret that you will not be using our services, but we’d like to clarify our policy on firearm sales. Due to federal and state regulations, we prohibit firearms and weapon sales when the transaction is not made in person. Mail order, phone, and internet sales of weapons, where the credit card number is manually-entered into Square, involve situations where we, and the weapons merchant, cannot confirm the identity of the buyer. Our policy, however, does allow in-person transactions for firearms and other weapons when the credit card is swiped on our card reader. In addition, parts, ammunition, and other accessories are permissible for card-not-present transactions. More information about Square’s Merchant User Agreement can be found here: https://squareup.com/legal/merchant-ua
 Section 6 provides additional details regarding prohibited businesses. Please let us know if you have any questions or concerns.
Full Edit and conclusion.
A little update. The buyer cancelled the sales so all is well.
I just wanted to inform you of the bug.
I would like to apologize for my harsh words.
I was told by many people that Square had all the legal right in the world to simply keep my funds.
I was extremely angry and acted out of impulse.
I still hope to do business with you guys in the future.
and I understand that it is more about the possibility of CC fraud then it is the actual firearms.
If you would have worded your response a little different I think that is what you meant, right?
(POST ANTI GUN UPDATE... I SURE WAS WRONG ABOUT THAT ^^^
I am looking into http://www.gopai.com/index.html
They are endorsed by the NRA and the NSSF."
This was BEFORE they changed to being outright anti-gun. I had a gut feeling and it was 100% correct. So sorry if it offends you.
But the truth is that they are anti-gun.
The CEO "Dorsey has said his dream job is to be mayor of New York City, and has offered high praise for the man who currently holds that post, fellow tech billionaire Michael Bloomberg.
Bloomberg has been a major voice in favor of gun control, leading the group Mayors Against Illegal Guns.
"I think that Mayor Bloomberg has done an amazing job, and I and a lot of Silicon Valley look to him as a guiding light because he's completely rethought what it means to be mayor," Dorsey told CNN in March."