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Ebay's PayPal Accused of Transmitting Online Gambling Funds31 March 2003CALIFORNIA – As reported by Bloomberg: "EBay Inc., the world's largest Internet auctioneer, said a federal prosecutor has accused the company's online payment processing unit PayPal of breaking the law by transmitting money from Internet gambling. "The U.S. Attorney for the Eastern District of Missouri contends PayPal violated the USA Patriot Act and offered a settlement of the claims in a letter received on Friday, EBay said in a filing with the Securities and Exchange Commission. The company bought PayPal in October. "The settlement would include PayPal forfeiting the purported amount of earnings from online gambling merchants from Oct. 26, 2001 to July 31, 2002 plus interest, EBay said. The company said the amount contained in the offer was more than the unit actually generated from online gambling and that PayPal had operated in good faith that it did not violate the law. "…PayPal exited the business of processing payments for online gambling merchants in November. "…PayPal said in August it would pay $200,000 in penalties to the state of New York and stop providing services to Internet gamblers there…" |