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PayPal Freezes Support Account For Bradley Manning 580

Posted by timothy
from the we-don't-like-you dept.
An anonymous reader writes "The online payment provider PayPal has frozen the account of Courage to Resist, which in collaboration with the Bradley Manning Support Network is currently raising funds in support of US Army Pfc. Bradley Manning. 'We've been in discussions with PayPal for weeks, and by their own admission there's no legal obligation for them to close down our account,' noted Loraine Reitman of the Bradley Manning Support Network (Support Network). 'This was an internal policy decision by PayPal. ... They said they would not unrestrict our account unless we authorized PayPal to withdraw funds from our organization's checking account by default. While there may be no legal obligation to provide services, there is an ethical obligation. By shutting out legitimate nonprofit activity, PayPal shows itself to be morally bankrupt.'"
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PayPal Freezes Support Account For Bradley Manning

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  • Again? (Score:3, Insightful)

    by Nuno Sa (1095047) on Thursday February 24, 2011 @04:11PM (#35304174)

    Can't those idiots be sued?

    • by Shikaku (1129753) on Thursday February 24, 2011 @04:13PM (#35304198)

      For what?

      They aren't a bank.

      • Re:Again? (Score:5, Informative)

        by nospam007 (722110) * on Thursday February 24, 2011 @04:21PM (#35304316)

        They are a bank, incorporated in Luxembourg.
        Complaints are to go to:
        http://www.cssf.lu/en/ [www.cssf.lu]

      • Re:Again? (Score:5, Insightful)

        by Ecuador (740021) on Thursday February 24, 2011 @05:46PM (#35305862) Homepage

        That is the biggest problem. They claim they are not a bank so as not to be regulated as a bank in the US, so they are allowed to screw customers by freezing funds at their discretion, not giving enough fraud protection etc.
        What is amazing though is this: I was reading an article on consumerist (http://consumerist.com/2010/05/keep-paypal-from-using-the-default-atm-debit-setting-to-save-on-bank-fees.html) and someone from Paypal got offended because they were called an "unregulated bank" by the author. So they posted this little tidbit:

        we're not regulated as a bank in the U.S. (we don't hold deposits or issue credit)

        Whoa, there, cowboy!
        First of all, what do you call the funds in the Paypal account? IMHO the only reason they are not called a "deposit" is because Paypal can freeze it at will!
        Secondly, if they are not issuing credit, WTF is "Bill Me Later"??? Just because they don't CALL it credit, it doesn't mean it is not!

        • by gordguide (307383) on Thursday February 24, 2011 @08:38PM (#35307844)

          "Not a Bank" might not be the absolute correct phrase, at least in terms of what we think of as banking. Broadly speaking, the reasons Paypal gives as "not a bank" would not be enough to be considered 'not a bank' in most countries.

          However, those reasons Paypal cites are the same ones that allow certain banks worldwide to avoid reporting rules. There are banks in some countries that are used to launder money or avoid reporting income, and they can do this because they are not subject to certain reporting rules which can be summed up thusly: if you don't pay interest or make loans, you don't have to tell regulators who your customers are ... thus numbered bank accounts and offshore tax havens.

          Since the US has vastly different banking rules than most nations, I don't know exactly where that puts Paypal ... I don't think you can avoid reporting rules, interest payments or no interest payments, loans or no loans, with a US bank.

          However, I do know that Paypal originally incorporated in the state of Louisiana specifically because of that state's lax banking regulations. As it was organized at first, apparently it would have been illegal in most states at the time. No idea if that's changed substantially in the meantime.

      • Re:Again? (Score:5, Insightful)

        by AK Marc (707885) on Thursday February 24, 2011 @05:48PM (#35305888)
        They are a bank. They are just what happens when you don't regulate banks.
    • Re:Again? (Score:3, Insightful)

      by Anonymous Coward on Thursday February 24, 2011 @04:14PM (#35304210)

      cant those idiots stop getting used?
      go for another service, personally i recommend google checkout mainly because it has the biggest chance of getting useful.

    • Re:Again? (Score:4, Insightful)

      by Yaur (1069446) on Thursday February 24, 2011 @07:13PM (#35307070)
      If they (paypal) are already holding the assets how is this not extortion?
  • Wow (Score:4, Insightful)

    by Charliemopps (1157495) on Thursday February 24, 2011 @04:13PM (#35304192)
    There really is no excuse for this at all. We're all entitled to a fair trial and the best legal defense available to us. This signifies that Paypal doesn't support the constitution or the rule of law. Shameful.
    • Re:Wow (Score:4, Insightful)

      by memnock (466995) on Thursday February 24, 2011 @04:17PM (#35304248)

      Paypal is a private entity. Unfortunately, it's not doing anything illegal or unconstitutional, as far as I can tell, by choosing not to do business with someone. What Paypal should do though is return the funds and those donors decide what to do with their own money, not choose for them.

      As an aside, I've never and never will, use Paypal for anything. I can send a check to a PO BOX. That's not secure, but I don't think of Paypal as secure either. If I want to be anonymous, I can send a money order. Stop giving Paypal business is my opinion.

      • Re:Wow (Score:5, Insightful)

        by causality (777677) on Thursday February 24, 2011 @04:43PM (#35304814)

        There really is no excuse for this at all. We're all entitled to a fair trial and the best legal defense available to us. This signifies that Paypal doesn't support the constitution or the rule of law. Shameful.

         

        Paypal is a private entity. Unfortunately, it's not doing anything illegal or unconstitutional, as far as I can tell, by choosing not to do business with someone.

        Too many arguments go like this. I believe it misses the real point being made. It was already well-established by the summary that Paypal has no legal obligation here.

        If you truly support the Constitution and principles like rule of law and due process, then you adhere to them even if the government is not going to use force to make you adhere to them. Anywhere that there is a choice in the matter, you get to see what people really believe in. Paypal wouldn't even provide a copy of the relevant portions of their policy.

        The funny thing is the implied hypocrisy. If any of the decision-makers at Paypal did find themselves in violation of the law, they'd never surrender their rights to due process. They'd want to know which law they are being accused of having broken. They'd want the prosecution to have to prove every claim it makes. But in their own little kingdom where they both make and enforce the rules, they want the ability to arbitrarily shut anyone down without ever having to demonstrate that they violeted the rules or even citing which rules would apply.

        In my opinion, they're assholes and if you do business with them, it is because you want assholes to prosper. Like you, I have never onced used Paypal and because of behavior like this, I never will. This is not remotely the first example of pathological behavior from this company.

      • Re:Wow (Score:5, Informative)

        by Enderandrew (866215) <enderandrew.gmail@com> on Thursday February 24, 2011 @04:59PM (#35305122) Homepage Journal

        I work for PayPal, but don't have any knowledge of why this decision was made first hand.

        I can say that in many past cases where a non-profit's funds were frozen, and everyone makes a stink about how evil PayPal is, it comes down to the fact that after the Patriot Act, PayPal is obligated by law to make sure non-profits file extra paperwork to prove their status. I think Xorg's funds were frozen for a while and everyone interpreted as PayPal hating open source, when in reality they just forgot to file paperwork.

        This certainly could be PayPal refusing to do business with anyone associated with WikiLeaks after Anonymous tried a DDoS attack on api.paypal.com, but it could also be another technicality.

      • by Grishnakh (216268) on Thursday February 24, 2011 @05:44PM (#35305828)

        As an aside, I've never and never will, use Paypal for anything. I can send a check to a PO BOX. That's not secure, but I don't think of Paypal as secure either. If I want to be anonymous, I can send a money order. Stop giving Paypal business is my opinion.

        Unfortunately, that's not a viable option for many people, such as people who sell goods online.

        1) Most buyers don't care about the problems with Paypal, they want to pay for stuff and get it quickly. Accepting only money orders is not a realistic option when you're running on online store; not only is a PITA to process them, but most buyers don't want to bother with going to the PO and paying an extra dollar just to send you money (plus an envelope and a stamp). They'll simply go elsewhere to someone that accepts credit cards or Paypal. Furthermore, international buyers can't do money orders.

        2) Accepting credit cards with a merchant account is expensive as hell, and only makes sense for larger online sellers (where the lower per-transaction fees at high volumes more than make up for the monthly and other fees). Small sellers can't afford merchant accounts.

        3) The only other alternative to Paypal is Google Checkout. But just like Ebay, chicken and egg: tons of people have Paypal accounts, and no one uses GC. So only accepting GC again will cut out much of your customer base.

        Unfortunately, you can't run a business with excessively high ethics. You have to compromise somewhere. For instance, suppose you're a brick-and-mortar store with a merchant account to take credit cards. But you think that Mastercard and Visa charge way too much in fees. Either you use them anyway, or you do cash-only, and go out of business because so many people these days don't use cash.

        It sucks, but Paypal is pretty much the only game in town when it comes to online transactions between small entities. They make it very easy for a small online seller to set up shop and accept payments; their fees are relatively low (2.9% + $0.30 per transaction, and only 1% extra for currency exchange, no monthly or other fees) compared to merchant accounts. They also make it easy to print prepaid USPS and UPS shipping labels to send your goods, without having to sign up for an additional account or pay monthly fees like Encidia and stamps.com do, and they get you better shipping rates too.

      • by SmallFurryCreature (593017) on Thursday February 24, 2011 @06:01PM (#35306114) Journal

        The true motivations of this guy are very clear, "we can circumvent the constitution by making everything private". Privatise everything and EVERY thing can be regulated without it coming down on the state. Right to have shelter? Sure you do, not out problem the renting industry doesn't want to rent to you. Right to counsel? Sure you do, not our problem you can't afford to pay for a private lawyer. Right to speech? Sure you do, not our fault you can't afford a spot on private television.

        It is very effective and the Mafia knows this. Control the basics and you control the town. You don't have to pay protection money, your garbage just won't be collected by the private company they just happen to have a say in.

        But they say, it says nowhere that your freedoms have to be available. Yes indeed, that is because they made bloody sure of that. It is how the system work. You are free from the state you elect and own yourself to the company store instead, that you don't elect.

        Private enterprise is the chain that binds free men. Next time you see a repubilican claim that something should be run by private industry or go un-regulated, look further.

        Remember, that republicans love freedom, their freedom to chain YOU. Because it is abundantly clear that Paypal indeed is not required to provide service to all, no US bank is. Doesn't that say it all? It means an essential service can be denied NOT after due process but simply because a board of directors decided to. In many ways I prefer outright dictatorship, at least the controls are clear then. Who made Paypal do this? Paypal has no morals on way or another, so which hidden master pulled its strings?

    • Re:Wow (Score:4, Insightful)

      by Nidi62 (1525137) on Thursday February 24, 2011 @04:25PM (#35304424)

      There really is no excuse for this at all. We're all entitled to a fair trial and the best legal defense available to us. This signifies that Paypal doesn't support the constitution or the rule of law. Shameful.

      Nowhere does the Constitution say that you have the right to have an online money-transfer system facilitate a non-profit in taking donations for a legal defense fund. They are a business, they have the right to refuse service to someone. If Amazon suddenly said "sorry, we aren't going to carry any of your books anymore", are you going to sue them for violation of your 1st Amendment rights against free speech?

      Besides, as he would be tried under court martial since he is a uniformed service member, the military has to provide him with counsel(a military officer). He can of course hire additional civilian lawyers if he so desires. But, if this infringes on his constitutional rights, then that would mean that anyone who did not have a non-profit taking donations for them would have been deprived of their rights as well. And(to get really pessimistic), the Constitution says nothing about the quality of your counsel, only that you have the right TO counsel.

      • Re:Wow (Score:5, Insightful)

        by Schadrach (1042952) on Thursday February 24, 2011 @05:18PM (#35305436)

        Big distinction -- they took the money from donators, and are refusing to pass it over the those whose account it was supplied to.

        PayPal can certainly refuse to deal further business with this fund, that is their right. But they should be required to either release the funds collected to the legal fund, or refund it to all donators, such that said funds can be donated through alternative means.

    • by Enderandrew (866215) <enderandrew.gmail@com> on Thursday February 24, 2011 @05:02PM (#35305168) Homepage Journal

      Your understanding of how the Constitution works is shameful.

      The Constitution is designed to protect freedoms. Here a private business has the right to refuse or offer service as they see fit. You would suggest that they be obligated to provide service to anyone against their will because it fits your wishes.

      Whether or not PayPal offers a financial service to a website doesn't change whether or not he will receive a fair trial.

  • by corbettw (214229) <corbettwNO@SPAMyahoo.com> on Thursday February 24, 2011 @04:14PM (#35304212) Journal

    Don't get me wrong, I have no problem using PayPal as a buyer if that's how a merchant has their account set up (though I'll only use credit cards through them and won't ever, ever, link a bank account with them). But who in their right mind would ever use this fucktards as their clearing house for financial transactions? Just get a merchant account and use your bank's credit card processing services, or go with someone like Google Checkout or Authorize.net. Using PayPal seems like you're just begging to have your accounts seized and funds raided because someone there doesn't like you.

  • "Land of the free" (Score:3, Insightful)

    by unity100 (970058) on Thursday February 24, 2011 @04:19PM (#35304282) Homepage Journal
    you are free to do anything in a capitalist economy. see, the catch is, everything costs money, and those with bigger money, can determine how much free can one be.

    such is the lesson of this incident, apart from the paypal's staggering lack of spine. roadside pimp may be having more spine and honor than paypal in regard to principles.
  • by mewsenews (251487) on Thursday February 24, 2011 @04:19PM (#35304286) Homepage

    PayPal shows itself to be morally bankrupt

    But not financially bankrupt!! Cha-ching!!

  • by pla (258480) on Thursday February 24, 2011 @04:22PM (#35304338) Journal
    I cannot imagine why any sane person or organization would use PayPal as a bank-like entity after their many, many, MANY abuses of their "not a bank" status.

    Seriously... It surprises more to hear about people successfully getting their money out, than stories like the FP.

    Really simple, folks - Just stop using them. Period. They have the right not to serve us, and we have the right not to use them. Exercise that right, and put these bastards permanently in the red ASAP.
    • Seriously... It surprises more to hear about people successfully getting their money out, than stories like the FP.

      That's because all you hear is the squeaky wheel. By some weird thought process that has lead you to believe that there are no wheels that aren't squeaking.

    • by tlhIngan (30335) <<ten.frow> <ta> <todhsals>> on Thursday February 24, 2011 @05:58PM (#35306050)

      I cannot imagine why any sane person or organization would use PayPal as a bank-like entity after their many, many, MANY abuses of their "not a bank" status.

      Seriously... It surprises more to hear about people successfully getting their money out, than stories like the FP.

      Really simple, folks - Just stop using them. Period. They have the right not to serve us, and we have the right not to use them. Exercise that right, and put these bastards permanently in the red ASAP.

      So how are you supposed to accept credit cards then?

      No one else lets you accept credit cards from random strangers without having to follow some really weird and arcane rules to satisfy the merchant account rules. Google Checkout doesn't (it requires you be a store), not sure about Amazon Payments, but I think it's similar as well.

      Face it - the only real reason people use Paypal is because it's pretty much the only way Joe Average can transfer some money to John Smith via credit card. Sure you can go to the post office and get a money order, mail it off, hope it arrives a week later, ... rigamarole, but that seems idiotic in this day and age of fast and easy e-commerce.

      And the other options aren't much better - western union? egold?

      Until someone manages to find a way to allow two random people on the internet send random amounts of money via credit card, Paypal's it. You want to put them out of business? Set it up in Paypal's niche.

      It's also why eBay bought Paypal - because they're very synergistic.

      And here's another question - why did they use Paypal? Why couldn't they set up their own merchant account? Or use Google Checkout? Or Amazon Payments? Most likely, either the fees are higher (Paypal may charge a lot, but credit card processors aren't cheap, either), or they didn't qualify. If they didn't qualify, Paypal ends up being the only way to accept credit cards.

      So why are people falling into the same trap again and again? Google Checkout and Amazon Payments should also work, as does a merchant account...

  • by Dachannien (617929) on Thursday February 24, 2011 @04:24PM (#35304386)

    So far, the only nominally credible journalistic outlet reporting on this story (and indexed so far by teh Google) is Huffington Post, which appears to be reporting solely based upon the press release.

    This would be a great opportunity for some actual journalism - to find out why Paypal actually suspended access, what the reason behind the checking account access requirement is, whether or not there's government pressure at work here, and whether or not there's something that Courage to Resist knows about but isn't saying in their press release.

    Or, we could just blindly accept everything Courage to Resist says as the unvarnished truth.

    • by blair1q (305137) on Thursday February 24, 2011 @04:42PM (#35304808) Journal

      Or maybe a little googling:

      http://techcrunch.com/2011/02/24/paypal-on-cutting-off-courage-to-resist-this-has-nothing-to-do-with-wikileaks/ [techcrunch.com]

      Summary: CTR set their account up incorrectly. PayPal asked them to fix it. CTR refused and lied about the situation to the media.

      Since dirt travels faster than explanation, PayPal will always look like dirt to someone who's encountered this botched story.

      • And further readings shows Paypal now says it was a misunderstanding and all is well now. [thepaypalblog.com]
  • by MickyTheIdiot (1032226) on Thursday February 24, 2011 @04:34PM (#35304616) Homepage Journal

    I work for a non-profit that does nothing remotely controversial and we have had to deal with the exact same issue. PayPal forces EVERYONE to withdraw from a bank account by default. They make no distinction about who they are dealing with and they care less about non-profit status. Because they are a quazi-monopoly on ebay payment they pretty much force people to do what they want if you want to buy or sell on ebay.

    If you want to be outraged, be outraged that the they use their monopoly status to force their fingers into bank accounts, not that the made some political move they actually didn't make.

  • by macraig (621737) <mark.a.craig@g[ ]l.com ['mai' in gap]> on Thursday February 24, 2011 @04:40PM (#35304740)

    So now Bradley Manning's ability to mount a strong defense is directly affected by corporate behavior having nothing to do with the judicial system. Gee, who knew that "business" could affect "justice" so directly? Does anybody really still think that simple campaign finance reforms are reformation enough?

    Corporate behavior can be as dangerous to democracy and ethics as any military campaign.

  • by Simozene (899342) on Thursday February 24, 2011 @04:53PM (#35305036)
    We need to stop pointing our fingers at PayPal and start pointing them at the US Government. I am sure political powers put a tremendous amount of force on PayPal to shut down the account.
  • easy solution (Score:5, Informative)

    by MooseTick (895855) on Thursday February 24, 2011 @05:00PM (#35305130) Homepage

    "They said they would not unrestrict our account unless we authorized PayPal to withdraw funds from our organization's checking account by default"

    Set up an account that only has PayPal deposits in it. Transfer that money daily to another account they do not have access to. At the wost, paypal can only take back the money they have deposited for that day. Problem solved and everyone's happy.

  • by mister_dave (1613441) on Thursday February 24, 2011 @05:13PM (#35305358)

    They said they would not unrestrict our account unless we authorized PayPal to withdraw funds from our organization's checking account by default.

    This is standard procedure for Paypal [paypal.com], in the UK if not the US:

    For security purposes or as part of the Verification process, you may be asked to add a bank account to your PayPal account and confirm ownership of this bank account.

    You can confirm your bank account by following these steps:

    • Log in to your PayPal account at www.paypal.co.uk
    • Click 'Profile' at the top of the page.
    • Click 'Bank Accounts' in the 'Financial Information' column. (Don’t see this step? Follow the alternative set of instructions below.)
    • Select the bank account you wish to confirm, then click 'Confirm'.
    • Click the ‘Set up Direct Debit’ button.

    "Direct debit [thesmartwaytopay.co.uk]" is the authority to withdraw money from your bank account. Lots of people do this with their utility bills.

  • by spinkham (56603) on Thursday February 24, 2011 @05:24PM (#35305552)

    I thought this was a news site? The fact that Paypal is a bunch of unethical business is not news.

  • by Anachragnome (1008495) on Thursday February 24, 2011 @07:33PM (#35307246)

    I didn't really have a "hero" when I was a kid, nor did I as I was growing up, primarily because all of the "heroes" I was told I should look up to were either fictitious (and thus inherently biased) or simply bullshit. Even as a kid that was pretty obvious. I did have people I looked up to, people I emulated as being role models, such as Gandhi and Martin Luther King Jr., but they focused on the symptoms of what was really a cancer that needed to be excised--they never addressed the root of the problems they made so much noise about.

    I do have a "hero" now, and have since the day I heard about him. Bradley Manning. He found himself in possession of something that could actually be used to address the root of those problems and did what he though would best serve that goal, as well as do what he took an oath to do--protect his country, not the government, but his country...at all costs, up to and including his life.

    Say what you will, but any way I look at it Bradley Manning knowingly risked his life to provide the citizens of this country, as well as the rest of the world, with KNOWLEDGE, knowledge that I think is crucial to our understanding of those we employ to run our country, and by extension, a large portion of the rest of the world (another issue entirely). It is one thing to speak out, it is another thing entirely to risk one's life in order to speak out. He knew the risks and weighed them carefully, I am sure.

    Many do not understand his actions simply because they wouldn't do such a thing themselves--put themselves in harms way for the betterment of others. That in itself, in my mind, is a symptom of exactly what he is trying to fix--the selfish ambivalence pervasive in our society that allows our elected leaders, as well as corporations, to do pretty much anything they want. That selfish ambivalence is a product of the misinformation and lies we've all been handed, as well as the omission of data from the public domain. The release of those cables is a huge step in dealing with such issues.

    That being said, fuck you Paypal. I've never been a customer and I never will because of shit like this (that also rules out doing business with anyone that requires PayPal transactions).

    Anyone have any idea if Courage to Resist has set up a SECURE (and by that I mean "unfreezable") means of donating? I'd like to donate.

  • by Old Wolf (56093) on Friday February 25, 2011 @01:53AM (#35309668)

    If anyone complains about an account then PayPal freezes it, without explanation to the account holder. They've always done this, and not just for high profile accounts. The only solution is to not use PayPal if it would inconvenience you to lose all the funds on your account.

"Card readers? We don't need no stinking card readers." -- Peter da Silva (at the National Academy of Sciencies, 1965, in a particularly vivid fantasy)

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