PayPal’s ‘misinformation’ misfire and what it means for finance

So what the hell happened? PayPal responded to the controversy by stating that an update to its Acceptable Use Policy, which also includes strictures against violence, nudity, and so on‚ had gone out in error, and that the company “is not fining people for misinformation and this language was never intended to be inserted in our policy.”

It looks, in other words, like PayPal’s legal team indeed was noodling on the idea of debiting money from customers’ accounts if they violated certain company policies, but decided not to go forward with it. Or else the company changed its mind after someone leaked the draft language to conservative media. We’ll never know for sure.

In any case, this feels like good intentions gone awry. I’m guessing that instead of passively tolerating a flood of garbage on its platform, some at PayPal proposed doing something about it—including the introduction of a financial penalty for the worst offenders. This wouldn’t be such a bad thing. After all, who cares if PayPal decided to hit blatant charlatans—purveyors of quack cancer cures, say, or those fundraising off “stop the steal” nonsense—with a modest financial penalty?

The problem, of course, is that not everyone’s definition of “misinformation” is the same. People can disagree in good faith on controversial topics, and companies like PayPal should not be in the position of punishing those with unpopular views by taking their money. In any case, it’s a moot point since PayPal has made clear it’s not going forward with such a plan. The bigger issue here is that fintech and crypto companies are no longer viewed as simply payment rails, but are getting dragged into the same thorny policy problems as social media companies. Welcome to the culture wars, PayPal.

Jeff John Roberts
jeff.roberts@fortune.com
@jeffjohnroberts

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