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The Almighty Buck Your Rights Online

Paypal Charged Under PATRIOT Act 314

Posted by Hemos from the fighting-them-man dept.
A reader writes: "Yahoo has the story: Paypal has been charged under the PATRIOT act for accepting and profiting from transactions with illegal gambling sites. According to their new rules they will no longer allow gambling payments due to the higher chargeback risk. It's good to see them charged for something, even if they have never had to atone for the thousands of customer dollars they have stolen." I know of a number people who've had problems, but I will say that I've had no problems with PayPal - on both my personal account and on the Subscription side of things.
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Paypal Charged Under PATRIOT Act More

Paypal Charged Under PATRIOT Act

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  • PATRIOT Act? (Score:5, Insightful)

    by MeanMF ( 631837 ) on Monday March 31, 2003 @04:12PM (#5633386) Homepage
    Yet more evidence that the PATRIOT act had little or nothing to do with actual terrorism...

    • Re:PATRIOT Act? (Score:5, Funny)

      by swingkid ( 3585 ) on Monday March 31, 2003 @04:15PM (#5633413)
      well, it terrifies me, if that counts

    • Re:PATRIOT Act? (Score:5, Insightful)

      by archeopterix ( 594938 ) on Monday March 31, 2003 @04:20PM (#5633467) Journal
      Yet more evidence that the PATRIOT act had little or nothing to do with actual terrorism...
      Yes, and this holds true even if you don't like PayPal. Two evils clash again, mixed feelings arise. To all who rejoice because of this: you may be next.
    • unless of course you happen to have a loose definition of terrorist...
    • The description of Paypal's crimes seems to be for trafficing money know to have been aquire illegally and/or transfering money to people for illegal activities. I thought this was money laundering. How have the laws changed? Did the Patriot Act give a bigger penalty for this?

  • oh yea.. (Score:2, Insightful)

    by Anonymous Coward
    ..those americans SURE like the word patriot...

    • Re:oh yea.. (Score:3, Insightful)

      by Dutchmaan ( 442553 )
      ...so did the French during the Regin of Terror...
      • hehe.. I knew I'd get modded down for that one!

        Americans would think I was bagging on them, and French would think I was bagging on them...

        So much for stating facts in relation to history.

    • There's nothing wrong with the word 'patriot', but I find something inherently offensive about the way that it's being used as a political toy to manipulate public opinion. It's the same with all of Bush's "god" stuff.

  • PATRIOT (Score:5, Insightful)

    by Anonymous Coward on Monday March 31, 2003 @04:13PM (#5633396)
    How is illegal gambling a matter of national security unless "terrorists" are directly profitting from it?

    • Re:PATRIOT (Score:5, Informative)

      by larry bagina ( 561269 ) on Monday March 31, 2003 @04:22PM (#5633480) Journal
      Gambling is a *huge* money laundry machine. Nevada cracked down on it, but offshore/foreign gambling sites don't have as many rules.


      If you've got a big stash of illegal cash (drug money. crime money, terrorist money), what better way to legitimize it than claim you just got really lucky?

      • Re:PATRIOT (Score:3, Interesting)

        by nelsonal ( 549144 )
        My favorite method involved a wealthy playboy, a card counter, and a dealer on the take, the playboy loses, the card counter wins and the three split the laundering fee. The biggest idiots in money laundering were these weed growers back home who tried to plow millions in profit through a combination driving range batting cage in a town of 10,000. Lets see at $2/bucket of balls everyone in town is buying two buckets a week for all of the season. Any tax investigator could see that the place was always em

    • Re:PATRIOT (Score:2, Funny)

      by Zeebs ( 577100 )
      I KNEW IT! You are a terrorist too! Officer officer!!! Das fuhrer, I mean the president will not be pleased.
      • Correct me if I'm wrong, but isn't it der fuhrer?

        Haha, grammar nazi correcting German. For some reason that just strikes me as funny.

    • Re:PATRIOT (Score:5, Informative)

      by Palos ( 527071 ) on Monday March 31, 2003 @05:03PM (#5633771)
      It was amended to the Patriot act like many other things before it was finalized, because no one would actually oppose the patriot act, and it everyone knew it would be approved quickly. The actual regulations concerning gambling fall under the "Bank Secrecy Act" part of the bill. More details can be found here [gtlaw.com].

  • This was coming all along... (Score:5, Insightful)

    by Str8Dog ( 240982 ) on Monday March 31, 2003 @04:13PM (#5633400) Homepage Journal
    PayPal has been used for quite a while in the grey market... DSS hacking hardware, Drugs by mail, Betting... It was only a matter of time they got busted for it. They are profiting on illegal activities.
    • Depends where you live. Remember, gambling isn't illegal _everywhere_, and paypal is an international entity, althoug it is based in the us.

      • Re:This was coming all along... (Score:5, Interesting)

        by Str8Dog ( 240982 ) on Monday March 31, 2003 @04:24PM (#5633497) Homepage Journal
        I think that argument is coming to an end soon. Claiming international entity to cover for the fact you are processing illegal transactions is BS legal double speak. The fact still remains this company is based out of CA and will be procecuted as such.

        As for the US Mint Post, that is not the same thing. The US Mint does not have direct knowledge of any transactions and they dont skim a percentage off the top.
        • I think that argument is coming to an end soon. Claiming international entity to cover for the fact you are processing illegal transactions is BS legal double speak. The fact still remains this company is based out of CA and will be procecuted as such.

          By this same token are not the credit card agency's also in breach then? I wish such a lawsuit would be levied against Visa, or at least Citicorp.
        • As for the US Mint Post, that is not the same thing. The US Mint does not have direct knowledge of any transactions and they dont skim a percentage off the top.

          The $5000 check I'm about to write to the U.S. government disagrees with that statement. Bloody taxes.
        • US Mint does not ... skim a percentage off the top.

          The US cash money supply is kept at a fairly constant rate of inflation. Same thing.

    • Re:This was coming all along... (Score:5, Insightful)

      by ryanr ( 30917 ) <ryan@thievco.com> on Monday March 31, 2003 @04:18PM (#5633453) Homepage Journal
      Yes, now they can go after the US Mint.

    • Re:This was coming all along... (Score:5, Funny)

      by Qzukk ( 229616 ) on Monday March 31, 2003 @04:22PM (#5633483) Journal
      They are profiting on illegal activities.

      In other news, the US mint was raided by the FBI today for producing materials which were often used in illegal transactions, as well as possessed by many terrorists and potential terrorists.

      "We feel that by striking now, we can keep this stuff out of the hands of people who do bad things," one agent said, under condition of anonymity. While stuffing evidence into large bags, he added "This stuff is the root of all evil." The agent declined to comment on rumors that Washington DC area banks would be the next targets of anti-terrorism action, stating that he "didn't want to tip off the bad guys."

      The Homeland Security department heads were unavailable to comment. When pressed, their secretaries indicated that they were currently in a meeting to determine how to confiscate all of "this air stuff" the terrorists seem to be breathing.

      • Re: Funny... (Score:3, Insightful)

        by Cryptnotic ( 154382 )
        But every time a $20 bill changes hands, the mint doesn't take a 1-2% cut, unlike PayPal.

      • Okay, the bit about confiscating air might be amusing, but the bit about not producing money any more isn't. This is coming. I'm sure of it.

        It seems to me that we are only a hair's breadth from becoming a cashless society. And I have little doubt that it will happen in the interests of national (rather than personal) security.

        • Don't bet on it. Mass hystaria my grip the like of Joe sixpack, but the people with the most money aren't buying it. The dissapearance of US currency as a printed bill would cause the richest of the rich to loose faith in the US dollar and take their currency business to Europe. You think our economy is bad now? The people running the show at the federal reserve aren't stupid enough to let that happen.
          • The people running the show at the federal reserve aren't stupid enough to let that happen.
            Never underestimate human stupidity.

            Besides, how would a cashless society hurt the richest of the rich? It seems to me that a society where everybody's liquid resources are all kept on computer would hurt the poor more readily.

        • Re:Don't laugh (Score:3, Insightful)

          by swb ( 14022 )
          I was thinking the same thing, but then it occurred to me that it would not only be really unpopular, but would not prevent a black market in -- you got it -- money!

          Besides, they don't have any good substitutes for it. SmartCards require electronic readers and can be hacked, traditional mag stripe cards suffer those defects as well as needing access (at least occasionally) to a whole infrastructure. And neither one is economically viable for $.50 purchases.

      • Re:This was coming all along... (Score:4, Funny)

        by Guppy06 ( 410832 ) on Monday March 31, 2003 @05:42PM (#5634090)
        I think you mean the Bureau of Engraving and Printing [treas.gov]. Nobody uses Sacagawea dollars, not even terrorists.

    • Re:This was coming all along... (Score:5, Interesting)

      by whm ( 67844 ) on Monday March 31, 2003 @04:31PM (#5633564)
      If my bank charges a transaction fee for checks I write, and I write a check for black-market goods, is my bank "profiting on illegal activities"? How is that logical?

      Whether they are legally a bank or not, PayPal's role in the transaction was as a bank, and they are profiting on the transaction, not on the goods. It should not be the responsibility of PayPal to audit all transactions.

  • PATRIOT charge? (Score:5, Funny)

    by ryanr ( 30917 ) <ryan@thievco.com> on Monday March 31, 2003 @04:14PM (#5633410) Homepage Journal
    So what happens now, they get the death penalty?

  • It's all in the name (Score:5, Funny)

    by Anonymous Coward on Monday March 31, 2003 @04:15PM (#5633412)
    Put patriot in front of something and it doesn't work as advertised:

    Patriot Missle
    PATRIOT Act

    etc..

  • The right thing to do for the wrong reason (Score:4, Insightful)

    by StandardCell ( 589682 ) on Monday March 31, 2003 @04:16PM (#5633431)
    Paypal has had it coming to them for a long time. A stiff penalty may wake them up somewhat. The real question is, will Paypal's policies improve sufficiently to correct their behavior and unethical withholding of funds?

    I hate to be a cynic in this case, but probably not. The magnitude of the average consumer's problem is likely far larger than the Patriot act allegations.

  • remember.... (Score:5, Informative)

    by RobertTaylor ( 444958 ) <roberttaylor1234@noSPAm.gmail.com> on Monday March 31, 2003 @04:17PM (#5633437) Homepage Journal
    PayPal = Ebay

    Just keep that in mind when boycotting PayPal by buying your stuff from ebay using nochex :)

  • Laugh or Cry? (Score:5, Insightful)

    by micheas ( 231635 ) on Monday March 31, 2003 @04:18PM (#5633448) Homepage Journal
    I don't like PayPal. So seeing them nailed under the Patriot act if kind of funny, But, using the Patriot act this way is confirming the worst fears of everyone aout this act.

    It is truely sad when the fight for our rights is being led by companies like PayPal.

    • Re:Laugh or Cry? (Score:2, Informative)

      by stratjakt ( 596332 )
      You mean your right to profit from drug sales, offshore gambling, ponzi schemes and wire fraud?

      PayPal is a great litmus test to get some precedent behind PATRIOT.
      • Yeah, sure, if you call "a great litmus test" something that has no inherent qualities that are illegal. Next are they going to charge the street corner under the PATRIOT act, since thats where many drug transactions take place? Or charge the Mint for producing the cash used in the transaction in the first place?

        Once the precedent is set, can I use the precedent in my murder trial? They can charge the gun with murder instead of me!

      • Re:Laugh or Cry? (Score:4, Informative)

        by elmegil ( 12001 ) on Monday March 31, 2003 @04:27PM (#5633526) Homepage Journal
        All of those things were illegal before PATRIOT and didn't need PATRIOT to prosecute them. PATRIOT allegedly is about stopping terrorism.

        Whatever you might say about PayPal and whether it was knowingly an accomplice or not, I can't figure out for the life of me how what they did could be construed to be terrorism.

      • Now all we need is reading a book (reverse engineering words back into thought) as a test for the DMCA, and they'll be on equal footing.

  • Huh? (Score:3, Insightful)

    by XorNand ( 517466 ) on Monday March 31, 2003 @04:18PM (#5633455)
    It's good to see them charged for something, even if they have never had to atone for the thousands of customer dollars they have stolen.

    It's good to see that Joe Smith was charged with felonious assault, because I *did* see him jaywalk that one time.

  • Hate them for hurting consumers, or like them because the Patriot act is totalitarian? Well that looks like a draw. I'll have to go to my backup.

    It's a monday, and mondays are... mondays. We haven't had any scapegoat stories so far today, so I guess this'll be it.

    So, in response, I believe that the crimes that Paypal has committed to the online community are grave enough to warrant actions of this sort. They got what was coming to them. Go USA.

  • Uh, no (Score:5, Interesting)

    by The Bungi ( 221687 ) <thebungi@gmail.com> on Monday March 31, 2003 @04:19PM (#5633459) Homepage
    It's good to see them charged for something, even if they have never had to atone for the thousands of customer dollars they have stolen.

    I've never had any problems with PayPal, though I know about and recognize the horror stories about people having their money borked wholesale by the service, and how their accountability is next to zero.

    But I don't think I share the submitter's glee about PayPal getting screwed - the "PATRIOT Act", which is supposed to be fighting terrorism.

    In any case, I've said it before and I'll say it again - PayPal is NOT a bank. If you must use them, never "deposit" money with them and always, always use credit cards.

  • Knowledge of a Criminal Act (Score:4, Insightful)

    by nuggz ( 69912 ) on Monday March 31, 2003 @04:19PM (#5633460) Homepage
    Interesting, they transfered money, they admit that.
    But was there a criminal act?
    Online gambling is not illegal everywhere.

    Did paypal knowingly transmit funds from a crime? Doubtful.

    Did they intend to commit a criminal act, even more doubtful.

    Just because you got screwed over by PayPal is no reason to support unjust legal harrassment.
    • Online gambling is not illegal everywhere.

      Doesn't matter. It's illegal in damn near every part of the US. That's the definition of jusrisdiction. It's why these online gambling companies can't even operate in Vegas - because if someone with a computer in AZ gambles on the site, they'd get shut down.

      Did paypal knowingly transmit funds from a crime? Doubtful.

      If they transmit funds that were acquired from an offshore account to an account or address in the US, then they pretty much know. Do you think p

  • Earlier today on NPR... Was looking for a cite on the web to submit, and sure enough there it is on the front page.

    I'm of mixed minds... I really am. I refuse to do business with PayPal; your money is probably safer if you email your bank account number to a Nigerian billionaire. On the other hand, USAPATRIOT is nothing short of an abortion of justice (with all of the mess that implies).

    Tell you one thing though... You can kiss micropayments goodbye. The only way a micropayment system wouldn't run afoul o
  • On another note, they just recently (last week or so) stopped handling transactions for porn. Porn and gambling at the same time?! They're gonna lose a ton of $$ from this (especially the porn). Lucky for them that they have access to EBay's deep pockets.
  • Such a thing is AGAINST THE AMERICAN WAY! Why, we all know to gamble INSIDE the country so that Uncle Sam can buy more bombs for Iraq. so they must be charged under the PATRIOT Act, even though they don't have any connection to terrorism, they're terrorists for robbing the US of much needed money -- which is all going to tax breaks after all.
  • Paypal is a nightmare to deal with when there's a problem. The best part of their scam is that e-bay wont listen to your complaints of fraud until 30 days have elapsed. (which is not unreasonable, since sometimes its just a miscommunication.) But paypal wont do anything for you until you file a complaint wwith e-bay. and they wont do anything for you if 30 days have elasped. Nice scam!

    the other paypal headache is that they will not let you get you money back if something you buy is not the same thing

  • PayPal's side (Score:5, Insightful)

    by Sanity ( 1431 ) on Monday March 31, 2003 @04:23PM (#5633490) Homepage Journal
    I emailed PayPal customer support over their apparent politically motivated freezing of whatreallyhappened.com's PayPal account (see here [whatreallyhappened.com] for the wrh.com account). To my surprise they responded quite quickly, but said that under the terms of their privacy policy they couldn't discuss the issue with me, but that there was another side to the story.

    What Paypal does is actually quite difficult, and I suspect it is a constant battle for them to prevent their service from being used illegally, and without them getting landed with massive liabilities. This is primarily due to the braindead way that credit cards work. I suspect that people that have had bad PayPal experiences might simply have become victims of the fact that Paypal has to be extremely aggressive about fraud just to survive.

    Before everyone hangs them out to dry - perhaps stop to think, for a moment, what their side of the story might be.

    • You have a good point. I use their services occasionally, but as soon as I receive any funds I transfer them into my bank ASAP. They run a pretty high risk business if you ask me.

    • Re:PayPal's side (Score:5, Insightful)

      by Guppy06 ( 410832 ) on Monday March 31, 2003 @05:51PM (#5634159)
      "and without them getting landed with massive liabilities."

      Their strategy for this involves their legal department repeating the phrase "We're not a bank! Really!" over and over again.

      "I suspect that people that have had bad PayPal experiences might simply have become victims of the fact that Paypal has to be extremely aggressive about fraud just to survive."

      No, they're extremely aggressive about hiding fraud. If you have a problem (such as being defrauded by a seller), PayPal will tell you "not our problem, deal with the seller," conveniently neglecting to tell you about the "dreaded C-word" (chargeback).

      PayPal doesn't want anybody to know about fraud because they don't want anybody to know about credit card fraud policies. When the buyer issues a chargeback, PayPal loses money, and it's more cost-effective for them to hide and/or sidestep fraud than to combat it.

  • Your bad (Score:5, Funny)

    by sevensharpnine ( 231974 ) on Monday March 31, 2003 @04:24PM (#5633492)
    I know of a number people who've had problems, but I will say that I've had no problems with PayPal - on both my personal account and on the Subscription side of things.

    Careful now, Hemos, the advertisements go on the TOP of the page, and the stories go on the BOTTOM. Please be more careful in the future.
  • The auction service operator said a letter received Friday from the attorney's office claims PayPal violated a part of the law that prohibits transmission of funds known to have been derived from a criminal offense or intended to be used to promote or support unlawful activity.

    And thus, the burgeoning aspirations of the Underpants Gnomes come to an end....

  • God bless (Score:5, Funny)

    by greygent ( 523713 ) on Monday March 31, 2003 @04:26PM (#5633511) Homepage
    God bless John Ashcroft for protecting us from "roulette terrorists".

  • Gambling sites, eh? (Score:3, Funny)

    by fobbman ( 131816 ) on Monday March 31, 2003 @04:27PM (#5633522) Homepage
    Taking money from gambling sites? The terrorists HAVE already won, but that's only because they bet on red.

  • Keeping gambling with the government... (Score:5, Interesting)

    by FunWithHeadlines ( 644929 ) on Monday March 31, 2003 @04:27PM (#5633527) Homepage
    ...where they think it belongs. Note these quotes from the article:

    " The auction service operator said a letter received Friday from the attorney's office claims PayPal violated a part of the law that prohibits transmission of funds known to have been derived from a criminal offense or intended to be used to promote or support unlawful activity."

    Oooh, sounds scary! Those evil PayPal people are criminals, huh? Well, let's see the details:

    "EBay, San Jose, said the attorney's office offered a complete settlement of all possible claims and charges covering a purported amount of earnings PayPal derived from online gambling merchants between Oct. 26, 2001, and July 31, 2002, plus interest."

    Ah, so we're talking about gambling! Sure, let's keep that revenue with the state-run lotteries, and riverboat casinos. We don't want to share our gambling takings with anyone else. So let's crack down on non-government gambling sites. What's that? "Online" gambling sites? Why that's the magic combination: the evils of the online world, and the evils of gambling. Let's get a big stick to use on them:

    "Hey, look, we got this here PATRIOT act we can use on 'em!"

    "PATRIOT act? They ain't terrorists."

    "They are terrorizing our bottom line, it'll work."

    ----------

  • I CAN'T BELIEVE IT!

    Why don't we just burn the Bill of Rights? That PATRIOT act has just about taken away all the rights we used to enjoy.

    From the article: The auction service operator said a letter received Friday from the attorney's office claims PayPal violated a part of the law that prohibits transmission of funds known to have been derived from a criminal offense or intended to be used to promote or support unlawful activity.

    Now how am I supposed to go about transmitting funds that are known to be derived from a criminal offense or are intended to promote or support an unlawful activity??? The Founders must be rolling over in their graves!

  • PayPal (Score:2, Insightful)

    by Anonymous Coward

    I dunno about paypal. I've never had any problems with them, but this new User Agreement is fucking LONG and split into like 13 pieces spread over many files. And here's the best part:

    At the BEGINNING it reads:

    We may amend this Agreement at any time by posting the amended terms on our site. Except as stated below, all amended terms shall be effective 30 days after they are initially posted on our site.

    So you think, okay, if they put something bad in there, I'll at least have 30 days until I read it

    • Re:PayPal (Score:3, Insightful)

      by stratjakt ( 596332 )
      I've noticed a lot of states are requesting Homeland Security funds to "control protestors". The NBC reporter covering the story said with a straight face something like: "Many of the protestors target the same facilities as terrorists and therefore we need funds to protect them.".

      The word terrorist is being thrown about by every talking head to get his message on TV, and will soon have no meaning. But what they're talking about is absolutely valid.

      Think about it. A terrorist (a real one) attack would
      • Yes, because I'm sure if the protesters had been staging a 'die in' in NYC when the WTC's were hit, they would have kept laying there and blocking traffic, not have been running for their lives like everyone else was. Maybe if you chose an example that was plausible your arguement would have merit.
    • Then again, I've noticed a lot of states are requesting Homeland Security funds to "control protestors". The NBC reporter covering the story said with a straight face something like: "Many of the protestors target the same facilities as terrorists and therefore we need funds to protect them.".


      A tidbit like this truly deserves a proper citation. Got URL?

  • Hmmm... (Score:5, Funny)

    by jpmahala ( 181937 ) on Monday March 31, 2003 @04:30PM (#5633560)

    "It's good to see them charged for something, even if they have never had to atone for the thousands of customer dollars they have stolen."

    Sounds like someone has a bit of a grudge, eh?

  • Electronic Currency (Score:4, Insightful)

    by mugnyte ( 203225 ) on Monday March 31, 2003 @04:32PM (#5633566) Journal
    Currency is a tool, a means for improving the barter system. Electronic currency would at frist seem to only the same requirements. But alas, no.

    Credit card companies, banks, etc., have all be indoctrinated with the restricting domestic "illegal" activites, in the areas that demand it. Paypal has just graduated into the same realm. No crying foul here. Electronic or online currency/exchanges/banks are indeed going to be responsible for tracking, preventing, and reporting on any activity a government wants.

    If this scares you, then realize the standard has been in place for quite some time; purchase histories are fair game during federal investigations. Even anonymous cash itself has been under this pressure for quite some time, from serial numbers to embedded symbols. Someone at a certain level wants to know how the money flows.

    mug
  • Paypal is a un-wonderful company that has all the power and info collecting abillity of a bank, with NONE of the responsibillities and government oversight.

    The 'PATRIOT Act' is a misnamed mishmash of constitutionally questionable definitions, 'laws' and knee-jerk, chilling-effect punishments.

    There are *already* laws that could take Paypal down for fraud, wire fraud, etc. (If the Justice department wasn't a gigantic mangina, bending over for monopolies and such.)

    Leave the BS filled PATRIOT Act out of

  • diversification is not the key for internet companies. find something that works, and stick with it.

    buying paypal was absolutely retarded on ebay's part. way to many problems with it right now. i mean come on, is it a bank or not? paypal thought they would be the western union of the digital world... NOT.

  • Not Charged (Score:5, Informative)

    by bellings ( 137948 ) on Monday March 31, 2003 @04:43PM (#5633639)
    According to the linked article (which neither the editor nor the submitter took the time to read, apparently) Paypal has not been charged under the PATRIOT act. Instead, "the U.S. Attorney for the Eastern District of Missouri claims the company's PayPal operation violated part of the USA Patriot Act", which is an entirely different thing.

    Wake me up when the bat-shit insane puritan who runs the Justice Department decides to file real charges, instead of just sending out thinly veiled extortion letters.
  • I am torn on this one. I use PayPal and have transferred a lot of money back and forth - but never at one time (meaning many small - max under $1000 transactions). They have been just fine for me.
    It is great if you have a household of shared rent and bills and you want to easily pay one central person without any paper checks.

    But I don't think that it is fair that PayPal is allowed to bypass the bank laws for the most part.

    I do know (not personally as in "my mother" but personally in the sense that I have "spoken" with them on the net via e-mail and discussion boards) people that have had 10s of thousands of dollars get locked up by PayPal.
    I trust PayPal for my small $300 transactions, and I even have it hooked up to my bank without too much worry on my part. But from what I have heard of others, I would not keep large sums of money in there (the few people that I know had over $50K in there when it was frozen and then basically taken from them).

    To be fair, the people I know that had their money taken were doing illegal things - so it became very hard for them to seek legal action against PayPal. It would be amusing to approach the athorities and try to explain that PayPal stole from you money that you were not going to claim on taxes and was obtained via non-legal ways.
    Whether or not PayPal kept that money when they realized what was happening, or if they just freeze any high $$ accounts (I had heard that they freeze them all if they are high $$ and/or high traffic so that they can investigate them and then unfreeze them if they are "okay"... not sure what is "okay" and who determines that).

    I know a close friend that used a credit card only once in 2 years, and the one time that they used it was to sign up for a website subscription (not slashdot) via PayPal.
    She then quickly had many charges run up on her card - it was someone that had stolen it. She had to run through circles with PayPal and the cc company to resolve it - in the end, it was someone at PayPal.

    And then the gambling. I personally have no issues with gambling - I don't have a moral issue with it - and the only reason the states really doesn't like it (no matter what moral claims they state), is that it is not something they can tax.
    So I don't personally feel that gambling should some get in trouble for this.

    Were I for some reason allowed to make decisions on all of this - I would want PayPal to be treated legally like a bank, and I would want gambling to be allowed to stay on the continental states and then taxed.
    As for the drug dealers that lose their money... I'm pretty ambivalent on that one.

  • Patriot act ok? (Score:2, Insightful)

    by msimm ( 580077 )
    Since when is it adult to celebrate an unjust law being used against someone your not very fond of (that particular moment)? Every once in a while a story like this gets posted and I remember what a mixed up bunch we are.

  • Paypal does work (Score:3, Interesting)

    by rf0 ( 159958 ) <rghf@fsck.me.uk> on Monday March 31, 2003 @04:50PM (#5633697) Homepage
    I use it for our online billing and have had no problems. The main thing I head people complain about is that amount of fraud however the person recieving money has to take some resonsiblity to check that the other end is legit. We've learnt to some degree to check who's serious, who's not.

    For example we always check the IP of the person who is ordering and compare it to their postal address. Now this cuts out about 75% of the fraud. Now on top of this people do use open proxies and these are harder to find. The basic rule is that if someone doesn't seem to check out we just refund the money with an explanation.

    Rus

  • Wow (Score:5, Funny)

    by The AtomicPunk ( 450829 ) on Monday March 31, 2003 @04:51PM (#5633702)
    I thought terrorists only got money from pot? That's what all those TV commercials say...

  • to be fair to paypal (Score:4, Informative)

    by AssFace ( 118098 ) <stenz77@gmaTEAil.com minus caffeine> on Monday March 31, 2003 @04:54PM (#5633719) Homepage Journal
    while I'm certainly not a huge fan of paypal, one should be fair to them.

    while paypal did allow some money to get through to gambling sites - it isn't their universal policy to allow all gambling.

    I konw from past experience that they do block some gambling sites - the problem is that they make it easy to exchange money without them (paypal) really knowing what you are doing.
    This is a good thing.
    But as a side effect, Joe User can give money to an online casino and paypal doesn't necessarily know that.
    So now they are getting in trouble because of that.

    They do have a list of casinos - and some casinos also won't let you use paypal - but it is a matter of them being aware of each other - it isn't something that will automatically work in the current system.

    So technically paypal isn't 100% BAD - they were/are doing something the right way - it is just that the legal community isn't happy with that.
  • I've used c2it.com in the past and it is great (and follows bank laws) - but the problem is momentum.
    PayPal has a huge user list and people aren't likely to switch over - so if you use c2it, you then need to convince others to sign up for it as well.
    Which is not terribly hard if you are trying to get a friend to pay you back and you live in DC and he lives in Wyoming...
    But it is an issue if you are trying to sell something on ebay, or if you have an online business - you need to go with what the majority of

  • False Alarm (Score:2, Insightful)

    by Ryan C. ( 159039 )
    Everyone calm down, put away the torches and the pitchforks. No one was charged with anything.
    Apparently the DOJ doesn't have enough real crime to prosecue and fills its spare time writing harassment letters to companies it feels it can use to further its neo-republican goals.
    The DOJ isn't stupid enough to ruin a good scare tactic like the PATRIOT act by making a test case out of PayPal. They've got a couple more years of cease-and-desist type activity until they either try to use the law or are voted ou
  • There goes 200,000 $ in people's PayPal accounts being locked up for some unknown reason. They have to pay the fine from somewhere...

    The company couldn't stay afloat if they didn't do this so if you're one of the accounts that got frozen, deal with it. It's all for the best - after all - they are liable for the fine. Once they pay it it can be business as usual.

    Oh, that's business as usual except for your account. Go ahead, open up a new one. What's the chances of being taken for a fool again?

  • PATRIOT? (Score:3, Funny)

    by miketang16 ( 585602 ) on Monday March 31, 2003 @05:50PM (#5634158) Journal
    True patriots would never stand for this pathetic excuse for a law.

  • Why is anyone surprised? (Score:5, Interesting)

    by dafz1 ( 604262 ) on Monday March 31, 2003 @06:10PM (#5634289)
    One, the PATRIOT Act was something than Atty. Gen. Ashcroft came up with as a result of an order from dubya not to let 9/11 happen again. The problem is, he sat in his office and came up with all of these wacked security ideas that he never checked with anyone in the administration to make sure it wasn't political suicide. He even wanted to suspend habeas corpus(look that one up on your own) for the first time since the Civil War(all of this is a summary of an article in Newsweek a couple weeks ago). Remember, this guy is Attorney General because he lost the Missouri U.S. Senate race to a man who died a month before the election. Two, in California, there has been a ruling that if you use your credit card to gamble online, not only has the credit card company broken the law, but you can sue them because they "gave" you a method to break the law(not to mention you don't have to pay that part of your credit card bill). So, kill all the lawyers. People need to learn to be responsible for their own actions. It's not PayPal's or your credit card company's responsibilty to make sure you don't break the law. The three biggest lies. 1. Yes, I'll respect you in the morning. 2. The check is in the mail. 3. I'm from the government, I'm here to help you.

  • Casting the first "atone" (Score:5, Interesting)

    by watchful.babbler ( 621535 ) on Monday March 31, 2003 @06:37PM (#5634479) Homepage Journal
    It's good to see them charged for something, even if they have never had to atone for the thousands of customer dollars they have stolen.

    This is the same logic recently used by NOW and several other abortion-rights groups in Scheidler v. National Organization for Women [findlaw.com]: sure, using RICO to prosecute anti-abortion protestors was an unprecedented expansion of racketeering laws, but at least they're using that unprecedented expansion against the right kinds of people.

    The logic was flawed then, and it's flawed now: if PATRIOT gets a successful prosecution, or even plea-bargain, out of PayPal, then the feds will be emboldened to prosecute more PATRIOT violations. Each prosecution feeds upon itself, until, like conspiracy or wire-fraud laws, PATRIOT will be "low-hanging fruit," attached to a great many cases with only tenuous ties to the ostensible goals of PATRIOT.

    You may not like PayPal, you may even have legally-actionable issues with them -- but file a class-action if you do. Don't cheer them getting prosecuted under a vague section of an overly-broad statute, because the next time they issue an indictment, it could be for you.

  • USAPATRIOT Act (Score:4, Funny)

    by cosyne ( 324176 ) on Monday March 31, 2003 @06:54PM (#5634590) Homepage
    In the interest of pointless nitpicking, USAPATRIOT stands for Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism. (And I thought I spend too much time coming up with useless shit). Truncating it to Patriot is kinda like referring to TCP/IP simply as CP/IP (and there are probably just as few people who are likely to get really upset). Still, I like to think of it as the 'ooosa pat riot' act.

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