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PayPal bans payments for porn on eBay (Other items nclude drugs, firearms and humans)
ZDNet / Cnet ^ | 05-01-03

Posted on 05/01/2003 9:57:40 AM PDT by Brian S

PayPal has extended its ban on porn to include products from parent company eBay's 'mature audience' section. Other items include drugs, firearms and humans PayPal, the payment service eBay purchased for $1.5bn (£935m) in October, this month published its revised policy on processing payment for adult material. Only PayPal members can access the policy statement.

The April revision amends a March decision that stopped payment for sexually explicit goods except those listed under eBay's "Mature Audiences". The latest revision includes eBay's merchandise in the virtual ban.

"The thinking behind the March decision was that because eBay had already put in place a number of steps that users had to go through to buy and sell items, it would be a logical step" to continue processing eBay's sex-themed goods despite the ban, eBay spokesman Kevin Pursglove said. "But users came back and said this made it very inconsistent and confusing. And they were right."

PayPal users will have until 12 May to process payments for intangible adult products such as online photos and streaming video. Sales of sexually themed tangible products can be processed until 12 June.

Pursglove said the revised policy reflected a cost-benefit analysis, rather than legal or moral considerations. PayPal currently faces charges by the US Attorney's Office over its processing of gambling-related payments. The company is accused of violating the Patriot Act by processing payments tied to illegal activities.

"It came down to a simple business decision," Pursglove said. "As PayPal continued to grow and review internal operations, there were higher financial and other risks associated with these kinds of payments."

These risks included a higher proportion of "charge backs," or merchandise sent back with refunds to the buyer. PayPal also saw more complaints by buyers and sellers in the category.

PayPal has done well for eBay, which last week cited the new unit's revenue as one reason for exceeding its own earning estimates.

EBay has no plans to restrict its own "Mature Audiences" category, Pursglove said.

With the new policy, sexually themed materials join a long list of items whose sale by PayPal members is either forbidden or highly restricted. These include bootleg recordings, counterfeit currency and stamps, water pipes and wired cigarette papers, illegal drugs, firearms made after 1898, humans, corpses and human body parts.

PayPal has carved out numerous exceptions to its ban on sexually themed materials, including what it terms "fine art"-- singling out Michelangelo's David as an example, should it come up for sale -- and issues of the magazines "Playboy," "Playgirl" and "Penthouse" printed before 1980.

While sellers and buyers of pornography may find themselves inconvenienced by PayPal's decision, competitors might find opportunity in the new policy. Yahoo's PayDirect service, for example, makes no mention of "sex" or "adult" content in its terms of service. Yahoo could not be reached for comment.


TOPICS: Business/Economy; Extended News
KEYWORDS: cya; doublestandard; ebay; paypal; porn

1 posted on 05/01/2003 9:57:41 AM PDT by Brian S
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To: Brian S
Wonder how long it will be until someone starts PornPal.
2 posted on 05/01/2003 9:59:01 AM PDT by JmyBryan
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To: JmyBryan
Wonder how long it will be until someone starts PornPal.

Free markets solve a lot of "freedom" issues!

3 posted on 05/01/2003 10:03:53 AM PDT by Lysander (My army can kill your army)
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To: Brian S
Hmmm.... ebay owns PayPal, ebay sells porn but PayPal won't handle the payment. Just seems weird to me.
4 posted on 05/01/2003 10:07:38 AM PDT by hattend
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To: Brian S
PayPal currently faces charges by the US Attorney's Office over its processing of gambling-related payments. The company is accused of violating the Patriot Act by processing payments tied to illegal activities.

Yeah, the "Patriot" Act < spit > will only be used to stop terrorists. Honest. Really. By the way, are you interested in buying a bridge?

5 posted on 05/01/2003 10:08:57 AM PDT by freeeee
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To: freeeee; hattend
E-Bay doesn't give a rat's ass. They'll still act as a clearing house for the stuff, and make their commision. They just don't want to open themselves up to any Federal charges for setting up wire-payments for the stuff.
6 posted on 05/01/2003 10:11:34 AM PDT by Wolfie
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To: Brian S
PayPal now issues secured Visa/MC cards that also works as ATMs.

Nothing would stop someone from using that to buy porn anywhere and pay for it out of their PayPal account.
7 posted on 05/01/2003 10:12:40 AM PDT by ElkGroveDan (Fighting for Freedom and Having Fun)
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To: ElkGroveDan
PayPal now issues secured Visa/MC cards that also works as ATMs.

Nothing would stop someone from using that to buy porn anywhere and pay for it out of their PayPal account.


I sent PayPal money to my friend because he had fronted me the money for some vacation hotel rooms. PayPal has no way of knowing what that payment was for. This is just a CYA on their part and has no real meaning.
8 posted on 05/01/2003 10:26:03 AM PDT by Arkinsaw
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To: ElkGroveDan
Paypal is just the brand name. It's handled by one of the major banks.
9 posted on 05/01/2003 12:27:21 PM PDT by College Repub (http://www.collegehumor.com)
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To: Arkinsaw
Well, on all other ebay listings you can check out and pay through paypal. They will make it so you can't do auction checkout or advertise PayPal on the listings.
10 posted on 05/01/2003 12:28:03 PM PDT by College Repub (http://www.collegehumor.com)
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To: College Repub
Not exactly. The debit card does draw from the PayPal account. I could go buy porn with funds directly from my PayPal account, if I wanted to (yecch).
11 posted on 05/01/2003 12:46:58 PM PDT by ElkGroveDan (Fighting for Freedom and Having Fun)
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To: ElkGroveDan
Not exactly. It draws from a bank which then draws from Paypal. Although we're splitting hairs at this point I suppose.
12 posted on 05/01/2003 12:51:51 PM PDT by College Repub (http://www.collegehumor.com)
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To: Brian S
Must only be on EBay as it looks like gunbroker.com auctions have some of them listing PayPal as a payment option.
13 posted on 05/01/2003 1:08:03 PM PDT by Dead Corpse (For an Evil Super Genius, you aren't too bright are you?)
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To: hattend
They try to hide the adult section (it is under Misc). I think that they also require a credit card for "verification" purposes to enter that section (I know that they did when they allowed firearms).

I'd believe that there are other websites offering adult merchandise using PayPal.

eBay likes the money, they just don't like the attention it can generate.

14 posted on 05/01/2003 1:09:15 PM PDT by weegee (NO BLOOD FOR RATINGS: CNN let human beings be tortured and killed to keep their Baghdad bureau open)
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To: Brian S; Sir Gawain; BrooklynGOP
water pipes and wired cigarette papers

AWWW COM'ON! Those are for "tobacco"......... really!

15 posted on 05/01/2003 1:16:39 PM PDT by Texaggie79 (YATTA!)
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