Fairlay should not only return the frozen funds, but also provide compensation if it was done in their error:

-failure to communicate to customer while communicating information to other channels
-said they will give a phone call, but didn't
-have arbitration listed in TOS, but don't actual provide it
-didn't provide any information to the cause and nature of the incident, nor a timeline for resolution

They will need a very solid explanation for the lack of transparency in their actions.  Most services and exchanges return funds for violation of TOS, and just ban the account.  Even then, unless an exchanged is defrauded (via hack or other means), freezing money indefinitely and keeping it is stealing.  It would only be acceptable to transfer it to the damaged party or the legal system jurisdiction overseeing the manner.