Thousands Delete PayPal accounts after $2,500 ‘Misinformation’ Threat

Did PayPal really back down?

Thousands of  Paypal users have been deleting their accounts over a now reportedly  reversed decision by the online transactions giant announced last week. 

Paypal had announced it would introduce a policy of fining users $2,500 for ‘misinformation’ as part of an updated user agreement which stated, “Violation of this Acceptable Use Policy constitutes a violation of the PayPal User Agreement and may subject you to damages, including liquidated damages of $2,500.00 U.S. dollars per violation, which may be debited directly from your PayPal account(s).”

The policy was scheduled to come into effect on the 3rd of November. 


Hoards of disgruntled users made social media posts detailing why they had decided to part way with the company, many of which flagged attempts at political agenda fuelled overreach. 

The list of offenses included materials that “depict, promote, or incite hatred or discrimination of protected groups or of individuals or groups based on protected characteristics (e.g. race, religion, gender or gender identity, sexual orientation, etc.),” or which “present a risk to user safety or wellbeing.”

Paypal reversed ‘misinformation’ part of the decision in the wake of the public backlash, and claimed the details of the updated terms of service were sent out in ‘error’, however as pointed out by reason terms related to ‘discriminatory behaviour’ still exist in the latest iteration of the acceptable terms of service agreement. 

The report states that PayPal in its ‘sole discretion’ can determine which users are guilty of a list of prohibited activities including, promotion of” “discriminatory” “intolerance” and “promotion of hate”. 

The list of extensive penalties still includes the possibility of a $2,500 fine, 

“If you are a seller and receive funds for transactions that violate the Acceptable Use Policy, then in addition to being subject to the above actions you will be liable to PayPal for the amount of PayPal’s damages caused by your violation of the Acceptable Use Policy.”

This continues, “ You acknowledge and agree that $2,500.00 U.S. dollars per violation of the Acceptable Use Policy is presently a reasonable minimum estimate of PayPal’s actual damages – including, but not limited to, internal administrative costs incurred by PayPal to monitor and track violations, damage to PayPal’s brand and reputation, and penalties imposed upon PayPal by its business partners resulting from a user’s violation -” 

The paragraph concludes, “considering all currently existing circumstances, including the relationship of the sum to the range of harm to PayPal that reasonably could be anticipated because, due to the nature of the violations of the Acceptable Use Policy, actual damages would be impractical or extremely difficult to calculate. PayPal may deduct such damages directly from any existing balance in any PayPal account you control.”

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