Because they're so cheap they have to worry about spammers and other sorts of abuse. It's more cost effective for them to refuse dodgy-looking accounts.

The big question is, were you using real information or did you put in fake info?

They're still in business because they're cheap and pretty reliable. But being cheap means there are things you can't get with them but can with others. For example, you can't pre-pay for the entire year ahead of time.