PayPal has been taking a lot of heat from the public lately following its insertion of politically-motivated Acceptable Use policies. In early October, the company announced that, starting November 3, 2022, they will be fining users $2,500 directly from their accounts if they are found guilty of spreading “misinformation.”

PayPal received instant backlash for its updated terms of service, and many users publically announced they would be canceling their accounts with the platform.

Federal Communications Commissioner Brendan Carr blasted PayPal’s new policy, calling it “Orwellian.”

“Paypal reserves the right to take your money if you post a message that PayPal decides is ‘misinformation,” Carr said. “This is why it is so vital that state and federal legislatures pass laws that prohibit discrimination by tech companies and protect free speech.”

David Marcus, the former president of PayPal, also Tweeted his disappointment with the company for their controversial decision.

Marcus wrote,

“It’s hard for me to openly criticize a company I used to love and gave so much to. But PayPal’s new AUP goes against everything I believe in. A private company now gets to decide to take your money if you say something they disagree with. Insanity.”

Following the severe backlash, loss of important customers, and tanking stock price, PayPal released a statement walking back their update and writing it off as an “error” in wording.

“PayPal is not fining people for misinformation and this language was never intended to be inserted in our policy,” said a PayPal spokesperson. “Our teams have made appropriate updates to correct these inaccuracies and we apologize for any confusion this has caused.”

However, despite PayPal’s insistence that this was an unintended inclusion in their updated terms of service, the company quietly updated its terms again to allow fines to be placed on users at the company’s discretion.

The newly-worded terms of service read,

“If you are a seller and receive funds for transactions that violate the Acceptable Use Policy, then… you will be liable to PayPal for the amount of PayPal’s damages caused by your violation of the Acceptable Use Policy. You acknowledge and agree that $2,500.00 U.S. dollars per violation… [is] a reasonable minimum estimate.”

So, now there is no direct threat of a fine for spreading ‘misinformation,’ but you will be fined if you violate the Acceptable Use Policy (AUP). What is in the AUP? Well, it prohibits the use of PayPal for “activities that relate to transactions involving… the promotion of hate, violence, racial or other forms of intolerance that is discriminatory.”

Another open-ended term, “other forms of intolerance,” is included in this updated version of PayPal’s AUP. Again, whether or not this has been violated will be left to the discretion of PayPal’s leadership.

Since there is no specific definition of “intolerance” laid out in the company’s policy, it really could be anything that PayPal views as a departure from its own beliefs and opinions.

As new online payment services enter the market, PayPal will undoubtedly lose its leading position in the market if it continues to threaten users with a hefty fine for disagreeing with its leaders’ personal opinions.

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