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PayPal Joined the Party

posted by Amy Schmitz

Adam Levitin commented on the eBay's opt-out arbitration program on CreditSlips.org a few weeks ago, and there have been campaigns calling for consumers to opt out of eBay's program.  Public Citizen has provided instructions on its website for consumers "to protect their constitutional rights by opting out of a forced arbitration clause and ban on consumers joining together in class actions."  eBay is not alone in using this sort of opt-out arbitration program.  Many tech companies have joined, or plan to join, the "party" in requiring consumers to opt out or be subject to binding arbitration.

Opt-out programs also may be layered now that PayPal is joining the party.  It recently sent notices to its users of policy updates, effective November 1, 2012, stating:

"You will, with limited exception, be required to submit claims you have against PayPal to binding and final arbitration, unless you opt out of the Agreement to Arbitrate (Section 14.3) by December 1, 2012. Unless you opt out: (1) you will only be permitted to pursue claims against PayPal on an individual basis, not as a plaintiff or class member in any class or representative action or proceeding and (2) you will only be permitted to seek relief (including monetary, injunctive, and declaratory relief) on an individual basis."

Query whether campiagns will begin for consumers to opt out of this program?  It also will be interesting to see how these opt-outs work in tandem due to PayPal's prominence as the purchasing mechanism for sites like eBay?  


I imagine this all came about because class action lawfirms are readying cases to file against them, and they want to prevent that.

Ebay and their Paypal subsidiary and getting into quite tortuous territory lately, with the 21 day money holds Paypal is putting on many long time users at the direction of ebay, their corporate parent.

Users with no history of fraud or the need to money holds.

These holds violate Federal Reserve Regulation CC, but oops, Paypal is not a bank so they are not covered by banking regulations! Well, except in Europe, the EU told them to close up or become a bank and be regulated there. So they did.

I wrote my congressman and requested that Paypal be brought under full federal banking regulations. I didn't get any results, but maybe if others wrote their congressman asking for the same things would change.

You will note that there is no method for notifying payPal. No physical address, no email address, no contact people. I had to dig into their website to find an address where I could Opt-Out.
Nice work by their attorneys & strategists.

I recently used pay pal and accidentally clicked on the Bill Me Later provision. There was no way to opt out and it made me sign up for what essentially is a credit card. They open an account in your name, and then you don't pay right away so they can charge you some interest. It was the most annoying and underhanded bs I've seen, recently that is. I will never, ever use paypal again for that reason.

Microsoft just put an arbitration agreement on Xbox Live gaming network, I had to agree to the clickwrap contract today. It's apparently possible to opt out in some way but as you can imagine that all took place on a TV screen so there's no way to print or save the agreement I was forced to agree too.

Congress should just put a stop to all of that, and those annual privacy notices too. Those should all be opt out unless I want to opt in to sharing my information with some company, all their partners, affiliates, ad nauseum.

I understand the EU has much better privacy practices than we have in the US. Why? Don't we deserve at least as much?

Has anyone heard if Paypal is closing accounts for people who are opting out?

I know discover requires you to mail a letter if you do not wish to go through mandatory arbitration,
however it isn't that hard, if arbitration were more fair and offer appeals and other judicial remedies I would be more inclined but cautious to allow it, if you use paypal please do so through your credit card in most instances.

Recently, I use pay Pal and accidentally click on the "bill after payment terms. There is no way to choose to quit, it let me sign up for what is essentially a credit card. They open an account in your name, and then you don't get payment, so they can charge you some interest. This is the most annoying and secret bs I can see, the last is. I will never, never to use paypal for this reason.

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