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Paypal Charged Under PATRIOT Act
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.
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.
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.
Str8Dog
using System.Darkside; public
" 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."
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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.
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 empty. They had a pretty good system for growing it, too, and probably could have lasted quite a while, if they hadn't gotten busted on their dumb money laundering plan.
Degaussing scares the bad magnetism out of the monitor and fills it with good karma.
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.
PyPal has gone way out of there way to prove they are NOT a bank. they can't have it both ways.
If they were a bank, and regulated as such, they would not have this problem.
If I give YOU a 100 bucks and someone else gives you a package, and you hand they guy 95bucks, and give me the package, you are part of what happened. Other wise people would use this technique to avoid crimes.
Now a bank just handles the money, not what you do with your money. delivery companies charge a few for moving goods, not exchangeing the money for the goods.
The Kruger Dunning explains most post on
This is the same logic recently used by NOW and several other abortion-rights groups in Scheidler v. National Organization for Women : 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.
"Freedom is kind of a hobby with me, and I have disposable income that I'll spend to find out how to get people more."