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Censorship The Almighty Buck

PayPal Freezes Cryptome's Account 253

Posted by kdawson
from the gov-com-business-model dept.
grimwell sends in the news that after Cryptome's little run-in with Microsoft and NetSol, the activist site has now had its funds frozen by PayPal. Cryptome founder John Young notes, "Google lists thousands of instances of this asymmetrical high-handedness." "We have reviewed your PayPal Account, and due to the excessive risk involved, we would like to begin parting ways in a manner that is least disruptive to your business."
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PayPal Freezes Cryptome's Account

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  • What's a Paypal? (Score:5, Interesting)

    by symbolic (11752) on Saturday March 06, 2010 @02:34PM (#31382014)

    I have, and will continue to, refuse to conduct business with online entities that do not support a non-Paypal option. I have never used Paypal, and I don't anticipate that this will change.

    • by Anonymous Coward on Saturday March 06, 2010 @03:44PM (#31382710)

      If this were a federally-regulated bank they would not be able to do this.

      • Re: (Score:2, Insightful)

        I for one support PayPal's decision, not because I don't like Cryptome, but because they are a private business making a decision that the feel suits them best.

        • Re: (Score:3, Insightful)

          by Anonymous Coward

          Why you need to support, or even express your support?
          True any private business can screw over its consumer, but why support this decission? Unless you are affilied with paypal there is no purpose. If you are, you should have declare it.

          • Re: (Score:3, Insightful)

            I have no affiliation with PayPal.

            I should have been clearer. I support their right to make this decision, and, if they were a federally regulated bank, they could have done the exact same thing. Read the info on Cryptome's site.

          • by Toonol (1057698) on Saturday March 06, 2010 @05:19PM (#31383562)
            A similar question can be asked about those people posting critical comments of paypal.

            A similar question can be asked about the 98% of slashdot comments that consist of people's opinions who don't have a direct involvement with the subject. Sometimes people simply like to converse about a subject.
        • Re: (Score:2, Insightful)

          by earls (1367951)
          I support your stance for being radical (in this environment) and honestly idealist.
        • Re: (Score:2, Insightful)

          by pitchpipe (708843)

          I for one support PayPal's decision, not because I don't like Cryptome, but because they are a private business making a decision that the feel suits them best.

          It's weird that you agree with a decision by a corporation just because it is a private entity. If they decided to bring a bulldozer over to your house and demolish it would you support that because "they are a private business making a decision that the feel suits them best"?

          • by earls (1367951) on Saturday March 06, 2010 @04:30PM (#31383144)
            Hey, let's play a game called "make up hypothetical situations to support our arguments." In this corner they're bulldozering our house. In the opposite corner they're buying us a mansion. WHO WILL WIN!?!
            • Re: (Score:3, Funny)

              by Terrasque (796014)

              Is this a trick question?

              Chuck Norris, of course.

        • by wizardforce (1005805) on Saturday March 06, 2010 @04:34PM (#31383172) Journal

          Paypal may be able to refuse to do business with whomever they like but so do we. Every time Paypal pulls a stunt like this, we as private individuals have a right to call them on it.

          • Re: (Score:2, Informative)

            I'm not saying you don't. I'm calling them on it, too. I am refusing to do any further business with them. This is a very stupid stunt on their part, but they are legally entitled to do this stunt (rtfa and the saga on Cryptome's site). Does that make it right? No. The law is retarded and is known to be subverted. Does PayPal have the right to do this? Yes. It sucks, and I wish John was able to get those donations to help him with the costs for the site, but it doesn't change the fact that PayPal has a righ

          • by Dogtanian (588974) on Saturday March 06, 2010 @06:15PM (#31384004) Homepage

            Paypal may be able to refuse to do business with whomever they like but so do we. Every time Paypal pulls a stunt like this, we as private individuals have a right to call them on it.

            Oh yeah, this pisses me off too. Every time something like this happens, someone will say that they're a private business that has the right to do what it likes- but usually in the context of someone having criticised that company and expressed in a way that seemingly implies that any criticism of their actions runs counter to that principle.

            They're entitled to conduct their business how they wish (within reason), and they're entitled to ignore the negative opinions. But they're *not* entitled to expect protection from legitimate criticism, opinion and discussion expressed by others, nor from the effects of such criticism on them if they choose to ignore it.

            Same with "you think XXXX product sucks? No-one was putting a gun to your head and making you buy it!" type posts. No- the company is free to sell a products, and people are free to buy it- and others are equally free to express their opinion and advice as they see fit. They don't like that? Tough.

          • Re: (Score:3, Interesting)

            by ShieldW0lf (601553)
            Inasmuch as they rely on PayPal, the fault lies with Cryptome for allowing PayPal to take over responsibilities that they could not be trusted with. They should have planned things better. Groups whose goal is to increase their capital cannot be trusted. In the end, they will always take more than is justified, scorch the earth behind them and bring your plans to ruin.
      • If this were a federally-regulated bank they would not be able to do this.

        to bring the American Economy to it's knees instead.

         

      • Re: (Score:3, Informative)

        by ktandaeo (116154)

        Banks do this all the time. Any merchant provider can stop your processing and withhold all your money due to "risk" at any time.

        Federally-regulated means nothing.

        • by MrMr (219533)
          Depends on which federation we are talking about.
        • by antic (29198)

          A start-up in the US recently had their account withheld by Citibank because of the content of some YouTube videos on their blog. This sort of situation isn't unique to PayPal.

      • Yeah, but they would get free money (aka “bailouts”) instead.

      • Re: (Score:3, Insightful)

        by clarkkent09 (1104833) *
        I don't know about 180 day freezing of funds, that sounds extremely fishy to me. But the part about not doing business with potentially risky clients? Try opening a merchant account with a major bank and see that you will get rejected or have your account closed in a second if they smell something risky in your business regarding things like a slightest hint of potential copyright liability or legal adult content, or any other legal type of business that they disapprove of.
    • Re:What's a Paypal? (Score:4, Informative)

      by spottedkangaroo (451692) * on Saturday March 06, 2010 @04:13PM (#31382978) Homepage
      you don't have to have a paypal account to make a payment with paypal. You can make a payment *through* paypal as a regular old boring ccard transaction.

      It's the merchants that really get shafted...

      I noticed that paypal is really the only option for selling software in the webos appstore. That's pretty depressing imo.

    • by Kenja (541830) on Saturday March 06, 2010 @04:31PM (#31383156)
      Frankly, most small web sales companies (talking about one person selling items via a web page) simply can not afford the fees involved in normal credit card transactions.

      PayPal is inexpensive and most people never have an issue with the service.
    • Alternatives? (Score:2, Interesting)

      by Reverberant (303566)

      I have, and will continue to, refuse to conduct business with online entities that do not support a non-Paypal option. I have never used Paypal, and I don't anticipate that this will change.

      I know people hate PayPal (and for good reason), but there is one reason why I continue to use PayPal for my web sales: the PayPal debit card, which means that I have near instant access my my received funds. It works great for me since I sell physical products, so if my cash flow is low, I can take the money from an order and immediately use it to purchase more inventory. I have Google checkout and Amazon Payments accounts that I can use for backup, but both of those hold on to your money for a set period;

      • by Cylix (55374)

        Until they hold your money hostage.

        Sure they can give it to you freely, but they could also freeze your funds for months based on suspicion.

        I have near instant access to my funds and I use a check card. It is called a bank and mine has functioned like that for ages.

        • Until they hold your money hostage.

          True, which is why I would love to hear about alternatives.

          I have near instant access to my funds and I use a check card. It is called a bank and mine has functioned like that for ages.

          The bank that holds my business account takes 24 hours to clear an in-state check and 48-72 hours to clear an out of state check. They also don't offer website cc processing. If you know of a Massachusetts bank that offers that service, I'd love to hear it.

    • by AmigaMMC (1103025)
      Same here. I own a business and I do not accept Paypal because too many people got their businesses ruined by PayPal for blocking their funds for reasons PayPal won't even give. Unfortunately they are not a bank and cannot be regulated by current US Laws, but I think that any entity that handles people's money should be regulated for those people's protection.
    • by meerling (1487879)
      So what you're saying is you'll punish a business or organization that is being harassed for whistleblowing because a non-regulated bank (by activity if not labeling) has cut them off from it's services for questionable and possibly collusional activity with the corporation that was the focus of whistleblowing of possible illegal and probably underhanded activities.

      Do you advocate the raping of females that wear short skirts also?
    • by rhook (943951)
  • Lucky bastard. (Score:4, Insightful)

    by acarey (34175) on Saturday March 06, 2010 @03:37PM (#31382642)

    I'd give anything to get a letter from PayPal like that. For us mere mortals, it takes about 30 click-throughs to close an account. PayPal is the Worst Thing In The World.

    • Oh, and if you don't have a credit card associated with it, but you have a balance of even $1.20, first you have to associate it with a credit card to establish...something.. about your claim to the pittance, then you can begin the closeout process...

    • by dbcad7 (771464)
      Try making a change and making it stick.. I changed banks 5 years ago, and last time I used paypal they tried to charge the old account even though I had changed the account to the new bank right after I switched.. They made me look like an a**hole to the person I ordered from, and started a fraud investigation on me, when it was all there in black and white.. This is why I just can't stand to use them.. I would rather direct charge my card.. I have also used Google checkout a few times, and that was painle
  • Oh great. (Score:3, Interesting)

    by Cow Jones (615566) on Saturday March 06, 2010 @03:39PM (#31382676)

    We just donated a few weeks ago... I really hope that money doesn't end up in Paypal's pockets.

    • by slim (1652)

      Per Cryptome - all donations have been refunded.

      Regardless of what happened, it wouldn't have ended up in Paypal's pockets, in the long term (although as other /. comments note - it can be in excess of 6 months). Either it gets refunded, or it eventually is unfrozen.

      • Re: (Score:3, Interesting)

        Can Paypal earn interest on it in the interim?
        • Re: (Score:3, Informative)

          by Anonymous Coward

          Their T & C say they can even keep the money without refund, so interest is the last of your worries.

          (the Xorg foundation lost $5k in this manner.)

  • by kaptink (699820) on Saturday March 06, 2010 @03:49PM (#31382764) Homepage

    Paypals AUP states as part of its AUP "prohibited activities" that you may not receive payments relating to the *sales* of goods that "infringe or violate any copyright, trademark, right of publicity or privacy or any other proprietary right under the laws of any jurisdiction". Keyword here being sales. Given that cryptome does not actually sell anything and paypal is used for donations only makes this act by paypal to be somewhat unwarranted I would have thought. Even tho companies tend to do as they please. Will be interested to see what happens.

    • Re: (Score:2, Insightful)

      by bhtooefr (649901)

      PayPal, being a business, also has the right to refuse any business they want.

      Freezing funds gets screwy, though.

      • Re: (Score:3, Insightful)

        by cawpin (875453)

        PayPal, being a business, also has the right to refuse any business they want.

        Freezing funds gets screwy, though.

        They lose a big chunk of that right when they spell out, in a TOS, what they can and cannot do. If they do outside those bounds they, just like users, are in violation of that agreement.

      • by number11 (129686) on Saturday March 06, 2010 @04:28PM (#31383138)

        PayPal, being a business, also has the right to refuse any business they want.

        That is true. But this is money they have already accepted from Cryptome's donors that PayPal is stealing.*

        *Even if they eventually give the money back, they are stealing the use of the funds for half a year. I'd accept a different word if they pay Cryptome interest at the prime rate.

      • Re: (Score:3, Insightful)

        by Skapare (16644)

        Businesses have no right to break the law. PayPal thinks the laws do not apply to them.

        We need to be expanding the boycott of PayPal and the boycott of businesses that use PayPal as the only means to pay. Maybe we should also go further and boycott those that merely include PayPal as one of the options.

      • Re: (Score:2, Interesting)

        by wizardforce (1005805)

        PayPal, being a business, also has the right to refuse any business they want.

        Not if it is a contract they don't. The GP might be a bit pedantic with the AUP but it does bring up questions regarding Paypal's doings in this case.

  • Paypal and fraud... (Score:5, Interesting)

    by hadesan (664029) on Saturday March 06, 2010 @03:59PM (#31382848)
    With heightened visibility comes more scrutiny. Paypal and their more shady customers probably don't want anymore light shown on their activities. Better for paypal to dump cryptome to protect their "more lucrative" albeit more less forthright customers...

    Here is a lovely site for some light reading... http://www.paypalsucks.com/ [paypalsucks.com]

    Also an interesting story on a new scam in Boston on a scam using facebook, twitter, and Paypal http://www.boston.com/news/local/breaking_news/2010/03/6000_fall_prey.html [boston.com]

    • Re: (Score:2, Insightful)

      by stimpleton (732392)
      Pay Pal Sucks [paypalsucks.com] comes up everytime there is a story about Pay Pal. Suspiciously, the "Alernatives To Paypal" section is but one vendor. In fact the "Alternatives" button leads you to the vendors website.

      A list of various alternatives would be fine. But just the one, it passes discredit to the whole site. Are the stories even real?
      • by Aladrin (926209)

        I don't know if the stories on that site are real, but the stories in general are. I've been a customer of more than 1 company that got screwed by Paypal.

  • by DustoneGT (969310) on Saturday March 06, 2010 @04:14PM (#31382996)
    There was also a recent story about a blogger who had his Citi account closed because he was controversial. Could this be a new trend? Could there be a back story here? I mean law firms of the big players might threaten to sue the bank of an enemy to make life difficult. Let's call this BLAPP, Banking Lawsuit Against Public Participation.
  • by zogger (617870) on Saturday March 06, 2010 @04:18PM (#31383032) Homepage Journal

    I don't want an alternative to payapl to buy stuff, because plastic cards work for that or postal money orders, that's the existing alternative, but an online "donations only" service, so it could be used for micro or "minimal" payments would be interesting. Something with a much smaller transaction fee, and geared to only non profit orgs to receive funding. The service itself could/should be a non profit org as well.

    • by fyoder (857358)

      There needs to be an alternative for small businesses and regular folk to collect money, something that has no monthly fee and only takes a small percentage (the smaller the better, obviously) of the transaction. No one has come up with anything to replace paypal for this. Why, I don't know, given that paypal seems to be inviting competition by pissing so many people off.

  • This definitely sucks for cryptome. But has PayPal actually done anything wrong?

    It seems to me that PayPal isn't trying to be evil here; rather, they made a business decision that cryptome wasn't an organization they wanted to do business with. Businesses make such decisions every day -- car rental companies in Canada, for example, often refuse to rent cars to anyone under age 25 -- so why is it different when PayPal does the same thing?

    (For the record, my company only takes payments via PayPal, but I'm e

    • by Fnord666 (889225)

      Businesses make such decisions every day -- car rental companies in Canada, for example, often refuse to rent cars to anyone under age 25 -- so why is it different when PayPal does the same thing?

      It would only be the same thing if the car company agreed to rent a car to you, took a week's worth of rental from you in cash, then said that since you were under 25 they were prohibited by policy to rent the car to you. Furthermore they would be holding your cash for six months while they investigated why you w

  • it is one of the bad reputation registrars in such cases, along with godaddy and 1&1. they should have gone with a more reliable and by the book registrar like enom

  • we would like to begin parting ways in a manner that is least disruptive to your business.

    Well, they could start by NOT grabbing the money for 180 days. I wonder how paypal would feel about it if someone held onto money owed to them for 180 days just because they could.

    • by shentino (1139071)

      When a company gets big enough to start pushing people around willy nilly, it's big enough to invite antitrust scrutiny.

  • Why don't cryptome post an account number where people can wire donations to? Yes, there are fees to a wire transfer, but for many they are not that huge, and many people probably won't mind.

    If the possibility existed, I'd wire them €50 in a moment, and wouldn't even mind €10 fees...

  • Here we are again (Score:3, Insightful)

    by Arancaytar (966377) <arancaytar.ilyaran@gmail.com> on Saturday March 06, 2010 @06:05PM (#31383934) Homepage

    ... didn't this just happen to Wikileaks?

  • by jonwil (467024) on Saturday March 06, 2010 @07:33PM (#31384542)

    I dont know the specifics of this case but in some cases they may do the "freeze the account until a full ID check has been done" because they have detected activity that would require the filing of a US government "suspicious activity report". Because normal PayPal sign-up does not involve carrying out the ID check you get with regular banks, anytime transactions happen that would require a SAR (which requires disclosing full details of the account holder), PayPal has to freeze the account and conduct the ID check so they can file the SAR.

    Any transaction over $10,000 requires a SAR, as does a series of transactions between A and B that total to more than $10,000. There are other triggers but I cant find any sources of info on those.

  • Try GunPal Instead (Score:4, Informative)

    by Kartoffel (30238) on Saturday March 06, 2010 @08:40PM (#31385010)
    Not trying to advertize, but if PalPal's politics rub you the wrong way, try GunPal instead. http://en.wikipedia.org/wiki/GUNPAL [wikipedia.org] https://www.gunpal.com/ [gunpal.com]?

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