Version: Zen Cart v1.3.8a/v1.3.8. Upgraded from 1.3.7 with a full uninstall/reinstall of the modules.

In the module config I have it set to "Require Confirmed Address = yes"
however I got an order today that was unconfirmed.

Logs of this order:
http://pastebin.ca/1504017
http://pastebin.ca/1504018

I placed another order myself with my unconfirmed PayPal account (I can not figure out how to confirm my address with PayPal) and it went through too.

Any ideas what is wrong?