PayPal ties itself in censorious knots

Payment processor giant PayPal has twice had to backtrack recently from an apparent attempts at censoring its users.

Late last week the Daily Wire reported on a raft of new PayPal policies, scheduled to be implemented on 3 November, among which were the ability to unilaterally take $2,500 from the account of its users every time they violate its acceptable use policy. There were also some additions to the list of things deemed to be violations, including the promotion of misinformation.

Since misinformation is a very nebulous term, defined almost entirely by the person using it, the story attracted a lot of attention. But the real escalation was PayPal’s decision to start fining its users, thus putting any funds of theirs held by the company at immediate risk, without any clear recourse to the legal system or any other kind of due process. This remarkable move received immediate backlash, including from its former President and one of its famous founders.

That seems to have been enough to persuade PayPal into an immediate retreat, with the company sending the Daily Wire the following statement: “An [Accepted Use Policy] notice recently went out in error that included incorrect information. PayPal is not fining people for misinformation and this language was never intended to be inserted in our policy. We’re sorry for the confusion this has caused.”

We’ll let you decide how plausible that statement is, but the supposed mistake was far from a typo. At the very least, presumably, it was something they were contemplating but hadn’t made a final decision on. It seems more likely, however, that it wasn’t a mistake and they just didn’t anticipate such a strong backlash, so have suspended the update to let the crisis blow over. Any subsequent attempt to introduce unilateral fines, especially for ill-defined infractions, will hopefully be treated with the same level of outrage.

This drama came just weeks after PayPal permanently closed three of its accounts owned by UK journalist Toby Young. Among his interests are a website that focuses on questioning conventional wisdom, especially on the Covid pandemic and on the climate, and the Free Speech Union, which offers support and legal assistance to people persecuted for their opinions. It seems one of those, probably the former, was deemed to transgress one of PayPal’s metastasising mass of rules, so the decision was made to unilaterally close all accounts associated with him.

Unsurprisingly, Young was able to share his plight with much of the UK media, resulting in many prominent UK figures, including 42 MPs, speaking out in opposition to the move. Eventually PayPal caved in to the pressure and restored the accounts, not before muttering something about ‘misinformation’ when pressed by the media to justify its actions.

So twice in the space of a month PayPal has made clumsy attempts to censor what it considers to be misinformation by its users and both times it has not only been forced into a humiliating retreat, but has suffered significant reputational damage as a result. Why would an otherwise apparently well-run and professional organisation continue with such acts of self-harm? The answer way lie with politicians.

For years now law-makers, especially in the US, have been pressuring social media companies to censor content they don’t like. But why worry about social media when you can effectively exclude the wielders of undesired opinions from the digital economy and the internet entirely? It’s quite possible that the decision of AWS to cancel the social media site Parler in early 2021 demonstrated to them the full extent to which a few tech giants control nearly everything these days.

It seems plausible that PayPal has been under political pressure to do something about ‘misinformation’, which is pushing it towards undefendable policy changes and enforcement actions. If that’s the case, the same pressure is presumably being applied across the whole of ‘big tech’. The co-opting of digital platform providers to censor their users seems like a clear attempt to circumvent legal due process, so we can only hope one of these clumsy attempts results in solid legal precedent being set before it’s too late.

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