Not receiving traffic from Google (penalized?)

I have a problem with a site (http://windowsphoneupdate.com) I bought from someone here on DP.
The site is receiving some nice traffic, but traffic from Google is not coming in. I have done a variety of improvements on the site. You can read my improvement diary here.

I am under the impression that this site may have been penalized for some reason. I checked manual actions but it doesn't show me any information, nor do the messages in GWT.

Here is a screenshot of search traffic (Analytics):


And here is a screenshot of GWT:



What could be wrong with my site? I think I tick most of the boxes to get at least some decent search traffic from Google. And it should rank on at least a few longtail keywords.

 

@deam do you know why the user was selling?

 

He moved focus to other business opportunities and forgot about this site for a while.
In the whole sale he was completely honest about everything and even got me some extra advertising income. So I doubt he is holding back something, if that is what you are suggesting..

 

did you checked the site for penalties before buying?

 

Yes, I did.. It seems the site is just sandboxed for whatever reason. I followed all the guidelines, lets hope it recovers in next Google update..