OPINION: This article may contain commentary which reflects the author’s opinion.
Payment processor PayPal is in financial hot water over a policy that initially called for imposing a heavy fine on users deemed guilty of spreading “misinformation” via the platform, which company officials later said was issued in “error.”
Last week, The Daily Wire reported that PayPal was set to implement a new policy that allowed the company to pull $2,500 in ‘fines’ from the accounts of any user who was said to be spreading “disinformation” and “misinformation,” an arbitrary determination at best, depending on perspective and point of view.
“The financial services company, which has repeatedly de-platformed organizations and individual commentators for their political views, will expand its ‘existing list of prohibited activities’ on November 3,” the outlet reported. “Among the changes are prohibitions on ‘the sending, posting, or publication of any messages, content, or materials’ that ‘promote misinformation’ or “present a risk to user safety or wellbeing.’ Users are also barred from ‘the promotion of hate, violence, racial or other forms of intolerance that is discriminatory.’”
The policy was said to apply to any actions taken while using PayPal. The outlet continued: Deliberations will be made at the “sole discretion” of PayPal and may subject the user to “damages” — including the removal of $2,500 “debited directly from your PayPal account” per offense. The company’s user agreement contains a provision in which account holders acknowledge that the figure is “presently a reasonable minimum estimate of PayPal’s actual damages” due to the administrative cost of tracking violations and damage to the company’s reputation.
But within a day, PayPal hurriedly issued a statement denying such a policy was set to take effect. “An [Accepted Use Policy] notice recently went out in error that included incorrect information,” a PayPal spokesperson told the Daily Wire. “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.”
However, following the initial report, many users fled the platform, claiming they won’t subject themselves to capricious left-wing definitions of “misinformation” or any subsequent fines associated with such a determination.
Just moved all money I had in my PayPal account out of it. And I very must suggest you do the same.
This is serious.
— Candace Owens (@RealCandaceO) October 8, 2022
The platform has since suffered heavy financial fallout. On Monday, the company’s stock fell more than 5 percent, per the Daily Wire: PayPal’s value fell nearly $6 billion as backlash mounted. The company’s stock closed at $90.18 on Friday afternoon and was trading at $85.40 soon after the market opened on Monday — roughly a 5.3% decline as thousands of social media users reacting to The Daily Wire story over the weekend announced that they would cancel their accounts. The Dow Jones Industrial Average remained flat while the technology-heavy Nasdaq fell 0.7% since Friday.
By the end of the trading day on Monday, PayPal stock tanked more than 6 percent “as the intense backlash appeared to spook investors, causing PayPal to lose over $6 billion in market capitalization.” The initial decision by PayPal to fine users drew no small amount of backlash.
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. https://t.co/Gzf8faChUb
— David Marcus (@davidmarcus) October 8, 2022
“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,” PayPal co-founder David Marcus noted.
“Under existing law, PayPal has the ability as a private company to implement this type of viewpoint-discriminatory policy,” Aaron Terr, a senior program officer at the Foundation for Individual Rights and Expression, told The Daily Wire. “Whatever motivation PayPal has for establishing these vague new categories of prohibited expression, they will almost certainly have a severe chilling effect on users’ speech. As is often the case with ill-defined and viewpoint-discriminatory speech codes, those with unpopular or minority viewpoints will likely bear the brunt of these restrictions.”
“These kinds of policies are unwise, threaten free speech, and invite legal risk,” Jeremy Tedesco, vice president of corporate engagement at Alliance Defending Freedom, also told the outlet. “When companies apply policies to restrict the religious speech of their customers, they could run afoul of prohibitions on religious discrimination that exist in many state and federal laws.”