US lawmakers urge PayPal to end ban on Palestinians in Occupied Territories

https://www.arabnews.com/node/2310186/business-economy

by belter • 3 years ago

162 145 3 years ago

mikece2• 3 years ago

I wish lawmakers would urge (or force?) PayPal to actually give you a detailed reason when they freeze your account and effectively confiscate your money. I still have hundreds of dollars tied up in the limbo of "your account is frozen but we won't tell you why."

zerr• 3 years ago

Try withdrawing again. They unblock it without any notification while keeping the account limited.

KptMarchewa• 3 years ago

It's the other way around. If you're flagged for AML investigation, telling you it would be tipping off and explicitely illegal.

Detrytus• 3 years ago

If you are engaged in money laundering then the very fact that your funds were frozen is enough of the tip-off. If you’re not then they might as well tell you about their suspicions. If you were mixed up in some money laundering scheme involuntarily you might even be willing to help the investigation

yamtaddle• 3 years ago

It does kinda seem like if it's flagged for investigation... like, eventually an investigation should happen, right? And then you either get your money back or are charged with a crime?

I get that that's not what actually happens, but it's pretty weird that it doesn't. They can't tell you about it because it's flagged for investigation. When's the investigation? Never.

zinekeller• 3 years ago

Actually, PayPal's action are definitely not just hostile customer support but something about their risk protection (which includes US government data) has tripped off and they can't legally tell you (the legal term is "tipping-off"). PayPal has many questionable decisions but this one is not even PayPal's fault (or more alternatively the US government forces every financial institution to act hostile "in the name of [US national] security").

Edit: wow, downvotes for just plainly stating what actually happens? Thanks HN /s

andylynch• 3 years ago

Not just the US. Most, if not all, developed economies have similar laws.

londons_explore3• 3 years ago

your account is frozen but we won't tell you why

If they suspect fraud, they aren't allowed to tell you about it. They also aren't allowed to give you your money back (incase the money is laundered).

The only way to get your money back is to get a court to order them to give it back. The process is fairly simple - go to a small claims court, and ask the court to order them to give the money back. They won't contest it, they will just return your money and close the account.

That way, if it turns out that it wasn't your money, or you are a terrorist, paypal is no longer liable - they were just doing what the court ordered.

foooorsyth2• 3 years ago

Pretty amazing how nonchalant you’re talking about theft. I guess the approved strategy for legal theft is as follows.

1. Create a payments company that accepts deposits and holds balances (a bank — but don’t call it that)

2. Create a broken AML algorithm that flags X% of deposits as fraud

3. Force the falsely accused to take you to court to get their money back

4. Keep the rest. Most people won’t contest

What a great “business” model.

p-e-w• 3 years ago

If they suspect fraud, they aren't allowed to tell you about it.

That sounds like bullshit. Why would a mere suspicion of fraud, in the absence of a subpoena or court/gag order, mean that they aren't allowed to tell the account holder that they are suspecting fraud?

dfxm12• 3 years ago

The process is fairly simple - go to a small claims court, and ask the court to order them to give the money back.

Where I'm from you gotta file in person and there's a fee for filing and you pay someone to serve the defendant. Then you gotta show up at the court date. That's a bunch of fees and two days off from work before you even get a decision. I understand that this is the process, but it's not so simple for a lot of people to take days off from work, come up with money for fees (especially if their paypal is frozen), etc. It just doesn't serve the regular Joe all that well.

valdiorn• 3 years ago

They have specific laws that BAN them from giving detailed reasons for why they froze your accounts. Giving you a reason, or sometimes even hinting that there might be a problem, would be classified as "tipping off", which is a federal crime and can land even the lowliest finance worker in jail.

People need to read up on AML (anti-money laundering) laws. They are a bit insane.

Know them because I've worked in regulated financial companies for years and have had to do the mandatory training about a dozen times.

denton-scratch2• 3 years ago

So even if there are no suspicions of money-laundering, they can't tell you why the account is frozen? Because otherwise, if they won't tell you why, it must be AML?

antihero2• 3 years ago

I don’t understand why people keep their money inside these platforms. Surely if you are getting a lot of money, you should be depositing it in your bank regularly?

pavon• 3 years ago

He said he had hundreds of dollars tied up. That is a fairly small balance for someone who does (did) a lot of business with paypal and is transferring it out regularly.

Quillbert182• 3 years ago

Not sure if this is relevant to your situation, but I found this blog post interesting:

https://jessesingal.substack.com/p/i-fought-the-paypal-and-i...

mjhay• 3 years ago

They want to earn interest on your money.

alistairSH• 3 years ago

The AML should really be update to something like... Freeze the account, refer immediately to law enforcement, if LE doesn't take action within XX days, unfreeze the account.

AMLs exist for a reason. It's the "freeze the account with no end in sight" that's the real problem. It's not like freezing the account isn't going to tip off any actual money laundering operation, so the freeze is only partially doing what we want.

mschuster917• 3 years ago

The only thing this will result in is even more funding for Hamas, and possibly even money laundering for Iran.

petesergeant• 3 years ago

What should ordinary people in the territories do?

lesuorac6• 3 years ago

I mean per the article, Palastine has banks with corresponding US banks to handle transfers. So, ordinary people of those territories can use their banks.

mschuster917• 3 years ago

Get rid of Hamas instead of shooting rockets at Israel?

Somatochlora• 3 years ago

You do not believe that there are any Palestinians who might have legitimate uses for PayPal?

hutzlibu5• 3 years ago

But they made the misstake of being born at the wrong place.

redditwhat2• 3 years ago

Even if there are some who would benefit from this (and they have plenty of others methods), should we make it easier for terrorists to transfer money through Paypal?

annoyingnoob• 3 years ago

Or just don't use PayPal. There is nothing necessary about PayPal.

jb12• 3 years ago

Given the recent seizure of crypto accounts funnelling money to Hamas and Iran[0], this seems pretty sensible, to funnel more financial activity in the region onto platforms that have good AML/ATF processes.

[0] https://www.timesofisrael.com/israel-seizes-30-crypto-wallet...

f6v4• 3 years ago

It might as well be that the only reason why Iran and others are active in Palestine is because it’s blockaded.

vxNsr2• 3 years ago

Before all this they had legal and fair election where they elected a terrorist org: Hamas.

Stop infantilizing an entire people. They are adults with their own agency. They are responsible for the decisions they make.

The reason a terrorist group runs things there is because they want it to. In fact, if elections were held today, Hamas would lose… to Islamic Jihad because they’re more radical. Support for Hamas has been waning in recent years not because they’re a failed government but because they’ve failed to deliver serious harm to Israelis. The reason Iran is active there is because their interests are aligned (destroy Israel). The reason PayPal doesn’t operate there is because the AML/KYC would be much too expensive for the amount of money they could possibly make on entering that market. The reason these “lawmakers” are agitating for this is because they hate the state of Israel.

q1w23• 3 years ago

Exactly. Also related to this...

https://www.haaretz.com/middle-east-news/palestinians/2023-0...

RobotToaster• 3 years ago

lawmakers urge

Shouldn't lawmakers, um, make laws? Instead of asking nicely?

boomboomsubban• 3 years ago

Yes, but I wouldn't be surprised if signing a meaningless letter an aide wrote gives better PR than pushing for a failed bill. And it's hard to imagine a pro-Palestine bill actually passing.

mikece2• 3 years ago

They don't have a majority sufficient to make such a law (or a super-majority to override a veto).

q1w23• 3 years ago

Correct - the letter was signed by 11 out of 535 members of congress.

...and it was the very vocal anti-Israeli ones, such as Rashida Tlaib

bushbaba• 3 years ago

Because this is a minority opinion speaking.

flagrant_taco5• 3 years ago

What would that law look like exactly? It couldn't single or PayPal and likely shouldn't single or Palestine to be sorry all the time and effort to get it passed.

fsflover• 3 years ago

"A company with <revenue/number of users/...> larger than <number> may not freeze your account without giving any reason and without any recourse.

somebody78978• 3 years ago

I don't think the U.S. government has the right to force a company to operate in another country.

KRAKRISMOTT• 3 years ago

However they do have the power to end a boycott, either directly or indirectly (see the laws passed by various states regarding refusing to do business with Israel).

hgsgm3• 3 years ago

Nor do legislators have the right to pursue US foreign policy. That's the executive's job

fweimer• 3 years ago

There's already a government office for exactly that: https://www.bis.doc.gov/index.php/enforcement/oac

However, it does not apply in this case because the U.S. does not recognize Palestine as a country, and if that changes, it seems unlikely that it would be a country friendly to the United States.

yieldcrv2• 3 years ago

it sounds like we need an anti-OFAC law. Instead of only telling companies who they can't transact with, tell them who they can't arbitrarily not transact with.

We need a financial bill of rights. Custody and payment rails should be like public utilities where everyone can use them regardless of your opinions about them.

edgyquant• 3 years ago

Any financial bill of rights passed would not apply to Palestinians

yieldcrv2• 3 years ago

It would apply to the companies located elsewhere who would now be forced not to be exclusionary

from2• 3 years ago

I think Republicans tried something like this in the aftermath of Choke Point, it didn't go anywhere: https://www.huffpost.com/entry/house-republicans-money-laund....

droopyEyelids2• 3 years ago

I'm curious why PayPal bans Palestinians. It's not like they want to limit their addressable market.

Seems likely related to OFAC, which is tough to google casually

https://ofac.treasury.gov/sanctions-programs-and-country-inf...

Nothing specific to Palestine on the country programs, but OFAC explains further that our sanctions are much more complicated than country-by-country here:

https://ofac.treasury.gov/sanctions-programs-and-country-inf...

bequanna• 3 years ago

Optics.

In short, they don't want to appear to be funding terror.

Please note, that isn't my personal opinion on the Palestinians.

x3874• 3 years ago

Preventing additional sources for financing state-sponsored terrorism, what is hard to understand?

hgsgm3• 3 years ago

*this specific state.

danaris• 3 years ago

My guess is they don't want to piss off the Israeli government—or the elements in the US government who see blindly supporting Israel as an axiomatic good.

flagrant_taco5• 3 years ago

I've had absolutely terrible experiences with Palpal. Lawmakers should be urging everyone to use a better service, forget worrying about PayPal's ban.

The last straw for me was when they blocked a transaction of a few hundred dollars without any explaination. I was talking to a support rep for well over an hour, repeatedly being told that there is no security team at PayPal that can see why a transaction was blocked override the block. I was told the security system was a black box, they wouldn't transferred me to a supervisor, and the end result was a recommendation to try a different payment system like bank transfer.

This happened to be on the day we were selling our house. The buyer came in with a cash offer and a 7-day close. The inspection results came back after the paperwork was already drawn up, when they asked for a few hundred for electrical repairs it should have been easier to do that as an addendum rather that completely redoing the closing settlement sheet. I guess PayPal had better ideas.

miroljub2• 3 years ago

I've had absolutely terrible experiences with Palpal. Lawmakers should be urging everyone to use a better service, forget worrying about PayPal's ban.

I'd rather have the government enforce something like user-friendly free globally available instant payment and settlement system. Then none of these shady services would be required.

Fox example, a version of SWIFT, but instant, free and distributed.

mschuster917• 3 years ago

That's not going to be possible, alone because there are countries like Iran or North Korea or maybe-countries like Palestine which are sanctioned for good reasons.

TimJRobinson4• 3 years ago

This is available today and already used by millions. It's USDC/LUSD on Ethereum/Polygon/Tron (pick your chain based on desired cost and security requirements).

The US government will never endorse it or allow major banks to give their full support through because they want control over the network to "keep the bad guys out".

flagrant_taco5• 3 years ago

I'd be happy for that system to exist in the private sector. Can't say I'd be too happy to see the federal government have a monopoly of all transaction data and censorship powers though.

ncr100• 3 years ago

Jokingly, I'm surprised they didn't just send you a poop emoji.

lisasays• 3 years ago

So is there any viable alternative to PayPal at present (for individuals and small businesses)?

That doesn't have onerous documentation requirements (like submitting all your PII to some untrustworthy entity) and is not subject to the same arbitrary seizures and stonewalling?

KMag2• 3 years ago

It's a legally mandated black box. Anti-money-laundering laws in the US make it explicitly illegal to even tell you that they suspect money laundering if they think you might be laundering money. (Source: 11+ years of anti-money-laundering training and quizzes in a Fortune 500 financial services company.)

They are legally required to be vague and/or lie to you if they think you might be laundering money.

hospitalJail• 3 years ago

Isnt this what Bitcoin is for?

Use Bitcoin. There are services that will convert bitcoin to other currencies and vice versa.

We don't need paypal.

TimJRobinson4• 3 years ago

Why would people use Bitcoin over sending USDC or other USD stablecoins directly on any other chain?

dogman1442• 3 years ago

Because that new boss is same as the old boss

``` /* * @title Blacklistable Token * @dev Allows accounts to be blacklisted by a "blacklister" role */ contract Blacklistable is Ownable {

```

[0] https://etherscan[.]io/address/0xa2327a938febf5fec13bacfb16a...

hk1337• 3 years ago

Paypal is trash, everyone should use something else anyways. Venmo is trash and sketchy AF (also part of PayPal).

Eumenes• 3 years ago

100%. I don't use any payment/money apps and my life hasn't skipped a beat. If friends complain, I tell them to write me a check or give me cash. Works just fine.

hersko• 3 years ago

This[1] interview gave me more of a nuanced understanding of the whole situation. Highly recommend it.

[1] https://www.youtube.com/watch?v=wv8F4NLr4E0&t=194s

upofadown• 3 years ago

Does US law have anything to say about private companies supporting human rights abuse in other countries through their policies?

capableweb• 3 years ago

If it did, almost none of the top companies in the US would exists anymore. Of course it doesn't.

dathinab• 3 years ago

the US often doesn't even have to say anything about human right abuse _in_ the US

bhouston• 3 years ago

I think it doesn't because it wants to control what is polices, rather than relying on third parties like human rights groups to decide that.

droptablemain• 3 years ago

The U.S. doesn't care about "human rights" if the supposed perpetrator supports U.S. hegemony.

user9823• 3 years ago

Yes, US law in 35 states does have something to say: https://en.wikipedia.org/wiki/Anti-BDS_laws#Anti-BDS_laws_in...

Namely, if you do not support the human rights abuses of one particular country, action will be taken against you.

causi• 3 years ago

People forget that just because a payment services is so entrenched and powerful that many people think of it more like a public utility doesn't mean it isn't just as amoral as any other company. Visa has shattered entire industries on a whim by deciding it was simply more profitable not to service certain classes of people or professions. Somehow they're allowed to do that. We need common-carrier rules for payment processors.

johngladtj• 3 years ago

Have you considered that regulation is what causes those issues?

ausbah• 3 years ago

stuff like processing sex industry related payments isn't illegal but isn't supported by big payment processors so it's defacto illegal. govt indecision to regulate here allows them to make shots of how economy operates via monopoly power

from2• 3 years ago

The sad reality is that Paypal doesn't serve these territories because they are "high risk" and also low income which means the amount of compliance officers they would have to employ to watch people in these territories and the regulatory penalties for accidentally letting a Hamas transaction slip through (these aren't easy to detect either as the government emphasizes that "terrorist financing" can be as little as a few hundred dollars at a time, in fact most terrorist financing prosecutions involve amounts < $10000) probably does not exceed the amount of fees they would earn.

belter• 3 years ago

Funny...PayPal is available to Israeli settlers residing in illegal settlements in the occupied West Bank. So it seems it is not the region...Western Union seems to be able to manage fine there: https://location.westernunion.com/ps?page=2&country=PS&q=Pal...

q1w23• 3 years ago

This is also why they don't serve Haiti, for example.

It's also not coincidental that this letter was just written, since only a couple months ago Hamas was forced to stop accepting Bitcoin donations because a number of their donators in the US were arrested after their contributions were arrested for sponsoring the terrorist group.

In fact it's such an unlikely coincidence, that some of the 11 US legislators that signed this letter are associated with non-profits who's donations seem to trickle into Hamas bank accounts...

Source: https://www.washingtonexaminer.com/news/house/ilhan-omar-ras...

US lawmakers urge PayPal to end ban on Palestinians in Occupied Territories

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