Paypal Sells Out to the IRS
by Hillary LaClair, Senior Editor
Paypal, possibly the most widely used third party payment processor, was found to have sold its users to the IRS. Several online casino gamblers use Paypal to put money into their accounts, and this news could have a large impact on the gaming community.
An announcement has been made that the company has opened their supposedly secure client account information to the IRS, creating quite the quandary for online casino users. There is already a substantial limit on the methods for payment to these websites, and the disclosure of this information may make it very difficult for online gamers to gamble online altogether.
Paypal stopped accepting payment to and from U.S. players in 2002 due to a fine they received by Attorney General Elliot Spitzer.
It should be noted that any online casino gambler report all earnings to the IRS to avoid repercussions from findings like this. Any online winnings that are not reported can and most likely will lead to legal action, including hefty fines and jail time.
Speculation is that the IRS is investigating more than just internet gambling. This information could provide the IRA with banks that are allowing transactions that violate the UIGEA to occur. From there, the crackdown on internet gambling could be detrimental.
"Even if they had kept themselves away, there was no reason for them to sell out the many people who gave them money and trusted them with private information," said online gambling analyst, Gordon Price.
The announcement has panicked the online gambling market. The move to share this information with the IRS is highly unethical and may very well lead to civil lawsuits against Paypal. With this finding, people feel that there has been a violation of security agreements
Trackback from your site.