U.S. Sen. Tim Scott (R-SC) recently forwarded correspondence to PayPal President and CEO Dan Schulman, noting concerns regarding one of the company’s operating policies.
“I was gravely concerned by the recently reported updates to PayPal, Inc.’s Acceptable Use Policy (AUP) that would provide the firm carte blanche authority to levy financial penalties against users it determines have violated poorly-defined anti-“misinformation” policies,” Scott wrote. “Private companies have no authority to serve as arbiters of free speech, or public policy and the proposed changes represented a gross overreach of PayPal’s fiduciary duty to its shareholders.”
Scott said the letter stemmed from PayPal’s announcement that their policy fining users $2,500 for spreading “misinformation” was published by mistake.
“I am glad that the swift and vocal backlash on behalf of PayPal’s 429 million consumers and merchants has forced the company to reexamine this deeply flawed policy,” Scott wrote.
Scott maintains financial institutions provide financial services, are not engineers of social policy, and should not punish industries such as firearms dealers or media companies because they disagree politically, nor should they promote credit to politically favored industries.
“Increasingly, companies seek to benefit from U.S. regulatory backstops and stability while blatantly ignoring or subverting long-standing U.S. protections for free speech and political diversity,” Scott concluded. “Going forward, I strongly urge PayPal to clarify how it will make its business decisions based on consistent, quantifiable risk-based analysis of customers, rather than internal policy decisions about what legal products and services should be available to consumers and markets.”