WikiLeaks Planning Legal Action Against PayPal, MasterCard & Visa
from the thought-this-would-go-away? dept
There hasn’t been much talk lately over the fact that PayPal, MasterCard and Visa all cut off Wikileaks late last year, after the US government freaked out about the release of some State Department Cables. None of the firms has done a very good job explaining why this makes sense (or why they continue to allow other groups, such as the KKK to receive funding, while singling out Wikileaks). I’m sure those three firms, which took quite a public bashing when the news originally dropped, would prefer that there not be any more talk about it. However, Wikileaks and the payment firm they used, DataCell, are apparently planning to file a legal complaint this week against all three firms in Europe. A draft of the complaint, which was obtained by Andy Greenberg at Forbes (linked above and embedded below), claims that the three firms violated Articles 101 and 102 of the EU Treaty, effectively a form of antitrust law. While I tend to think many antitrust claims are merely attacks on successful companies, this seems like a case where they could make sense. Here you have basically the only three ways for most people to transfer money easily, all agreeing to block a single (small) client from receiving money, despite no legal ruling against the operation (hell, charges haven’t even been filed). It certainly would make for an interesting case.
Filed Under: antitrust, collusion, europe, wikileaks
Companies: mastercard, paypal, visa, wikileaks
Comments on “WikiLeaks Planning Legal Action Against PayPal, MasterCard & Visa”
Generic jingoist troll statement. Lie feigning empathetic insight. Criticism of author, not content. Criticism of those who dare discuss the content. Baseless accusation of condoning child pornography toward those who challenge obvious attempts at obfuscation.
There, now that most of the stupid comments are categorically out of the way, let’s get down to business.
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you forgot blatant 9/11 comparison, outright denial of fact, and throwing in “but the children”, tea party, and acting like this a democrat/republican issue.
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Equating a position free unmonitored and/or anonymous association and communication of being pro-piracy. Statement that all telecommunications or internet businesses are pro-piracy or at best are enablers and facilitators.
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HITLER! HITLER! HITLER!
(abusing Godwin’s Law for fun and profit since 1987)
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mmm, though isn’t there a …err… i forget the word, starts with C… meaning that if you deliberately invoke it to prevent it, you lose anyway? or something. *brain is made of fuzz right now*
Ok.. But...
What happens if WikiLeaks win’s the lawsuit? Would they collect damages? How does one determine what the damages are when being blocked from collecting donations? Will it actually stop anyone from blocking them again?
Can some of our legal types out there help me out (Trolls need not apply)?.
Re: Ok.. But...
I have little understanding of the EU law, so of course I have an opinion on it… 😉
I don’t think they’re suing the vendors… just bringing a complaint to the government. If ‘found guilty’, the groups would likely face penalties and (even more) bad press. I don’t think WL will get anything out of this other than satisfaction.
Re: Ok.. But...
If they lose, they can be fined up to 10% of their global earnings, iirc.
In any case, it’s a European issue, the 3 companies have abused there monopoly powers to make life more difficult for both Wikileaks and Datacell. Especially Datacell (a company) is now at a competitive disadvantage to other providers because of the credit card companies and Paypal.
It’s pretty much a failed set of arguments for any number of reasons.
The most important is that wikileaks is not dependant on any of these sources as their exclusive way of getting money. The mail still works, fedex still runs, the banks still cash checks, etc. Yes, Visa, Mastercard, and Paypal are more convenient, but they do not control the money movement market.
Further, no company can be bound to provide payment processing services for an illegal or questionable site. While it is true that wikileaks has not been specifically charged and may, perhaps be legal where they are operating, it is also clear that Visa, Mastercard, and Paypal have significant legal risks in providing payment services as they have significant operations in the US and other countries, where wikeleaks legal status is somewhat in question. The risks for these companies far outweigh any financial benefit for providing payment processing.
It is also clear that the Wikileaks people have been slippery with the truth, using third party companies, less than honest addresses, and the like to get their processing done. Third parties accepting Visa transactions requires that the company have a sort of IPSP account (for allowing third party transactions), and each third party must be directly approved by Visa. Without it, the processing can be stopped without warning.
This story reads more like Wikeleaks being more than slightly desperate for attention, as fewer and fewer people (and the media) are paying attention to their spew anymore.
Re: Utility vs. Practicality
Online, the ease at which a task is done greatly affects the odds a person will perform that task. While there are other methods by which to donate money to Wikileaks (mail order checks, wire services, etc.), these methods are less attractive for many reasons, not the least of which is security and ease of retractability (i.e. “changing their mind”). If there are no methods for providing money through purely online means, that’s a significant hurdle to receiving donations.
Not to mention, the lack of support from these services is as much a cessation of services as it is a condemnation of the site itself (Well if THEY don’t trust the site, why should I?)…
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“The most important is that wikileaks is not dependant on any of these sources as their exclusive way of getting money.”
Sooo “The most important” argument is a website that can’t accept web payments or donations shouldn’t be able to complain because you can still mail them a check? IANAL but that sounds pretty weak!
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It really isn’t a weak argument at all. The point is that Visa / Mastercard / Paypal are (a) not the only online processors, and (b) not the only way to move money from one place to another. Anti-trust would pretty much require proof that wikileaks was left with few options.
The real issue for Wikileaks here is that they were in some cases using other companies’ accounts, and provided less than honest answers to applications for banking and such. Wikileak’s issue is that in an attempt to remain anonymous (and what appears to be an attempt to avoid taxation by not holding the money themselves), they have left themselves with fewer paying options. The German charity that was fronting for them is apparently in a whole pile of legal shit over this very issue.
Wikileaks may not even have standing here, unless the Visa and Mastercard accounts were their accounts to start with. It is entirely possible that Wikileaks fails to meet the general criteria for obtaining processing, which would be applied equally to all potential account holders. They would have a very hard time to prove antitrust issues against these companies, or to show that they had been treated exceptionally.
Wikileaks’ desire to be hidden is their downfall, legally.
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So what about the Westboro Baptist Church?
Or al-Mujihade’en?
Or the Democrat Party?
You miss that point that Visa, Mastercard and Paypal are the easiest/i> routews to access monies and to give monies. If each of those three cut off someone (at the suspected behest of a government), that there’s, um, cheques and AMEX. And seeing as cheques are no longer accepted in most of Europe…
Moreover, it is not Wikileaks doing the filing. It is the company who were their provider, who are suffering direct attributable losses as a result of this conveniently-timed triple-whammy of provision removals.
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Checks, wires, money orders, western union, direct deposits, bank to bank transfers, and of course, good old “cash in a plain envelope”. There is no shortage of ways to pay wikileaks, except each of the ones I listed would require them to actually expose themselves in a public manner.
Wikileaks choses to be hidden. That limits their options.
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actually, most postal systems have rules against ‘cash in a plain envelope’ starting with ‘if someone steals it, it’s not our problem’ and ranging up to ‘will not be delivered’ or possibly even ‘yeah, thanks for the money’
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Uuh, Western Union uise the tellers to process the payments, Checks are no longer valid in Europe, and money orders take days to clear. Note that I said the easiest methods are disabled – they just happen to amke up the vast majority of the methods.
Antitrust is the abuse of a market in order to exert pressure on other companies. That’s why IE became an antitrust issue. That’s why Microsoft are trying to antitrust Google.
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Not just the easiest, they are also by far the biggest.
In Europe you will be hard pressed to find people who don’t use Visa or Mastercard (they are a duopoly at best), and Paypal is the only major online payment processor that I know of that doesn’t require a US bank account.
Basically, if your company is cut off by those three organisations, especially if you are an online company, you’re pretty much screwed.
The fault lies with us and our guvs, for not having open banking standards and for not inviting more home-brewed competition into the mix…
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after reading 101 and 102
“First, agreements between two or more firms which restrict competition”
One could argue that they are being “restricted”.
“Second, firms in a dominant position may not abuse that position”
Not getting paid!? Seems fairly abusive to me…
“Wikileaks’ desire to be hidden is their downfall”
Pot meet Kettle?
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Fail comment Jul 5th, 2011 @ 9:53am.
The main outfits give WikiLeaks attention when it’s profitable for them. US having data leaked was a blockbuster for those morons. WikiLeaks is much more than cables from the US.
And, well, if I were releasing sensitive data about violent and corrupt Govts I’d certainly be very cautious about everything concerning me and my site, including locations, names and so on. You know, bombs may mysteriously explode under your arse.
Stop and think before posting.
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> for an illegal or questionable site
Illegal hasn’t been determined.
Questionable is irrelevant and subjective.
Different people have varying notions of questionable. Should Visa not process payments for The Church of Scientology? Should MasterCard not process payments for a gay and lesbian organization? What about a motorcycle club? Is the KKK an illegal or questionable site? If so, then why is it still okay to process payments to them? What about stores that sell equipment and accessories that support the crime of skateboarding?
> it is also clear that Visa, Mastercard, and Paypal have
> significant legal risks in providing payment services as
> they have significant operations in the US and other
> countries, where wikeleaks legal status is somewhat in
> question.
What legal risks? Have they been presented with a government order not to process payments? If so, then they are in compliance. If not, then what legal risks?
> This story reads more like Wikeleaks being more than slightly
> desperate for attention
I think it only reads that way to you.
> fewer and fewer people (and the media) are paying attention
> to their spew anymore.
They still seem to make national headlines in main stream television media.
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Danny, let me give you an example.
Visa and Mastercard process for porn sites. However, they do so with many restrictions, and they do carefully review sites before granting processing. They do not want to be involved in processing for sites that could be illegal (child porn, bestiality, etc), which could create liablity for Visa.
Paypal, American Express, and other do not allow porn sites for processing, which is their right. They limit their exposure to risks, and apply the rules equally to all sites of this nature.
In the case of Wikileaks, we know that Manning is sitting in jail pending trial for leaking documents. V/MC can look at that sort of thing, see risk, and decide not to take it. They can pretty much write the rules to say “we will not generally process for any site that distributes secret government documents”, and be done with it. They are private companies and they are not obliged to process for anyone.
As they are not the only methods to move money (and not the only methods to move money online), the anti-trust aspects are pretty hard to support.
The only successful anti-trust actions that have been brought against V/MC in the last 10 years revolve around fees and restrictions on issuing banks.
As for wikileaks getting coverage, I suggest this link:
http://www.cnn.com/search/?query=wikileaks&primaryType=mixed&sortBy=date&intl=true
It’s pretty much a clear that there is only a single story one the first page (last couple of weeks) that relates to anything specific about wikileaks “leaks”, and the rest is discussions of hactivists and cyber warfare. Wikileaks is losing it’s grip on the media. I mean, when was the last time you saw Julian on the news spewing something new? It’s been a while.
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> They do not want to be involved in processing for
> sites that could be illegal
That sounds like they do not want to serve sites whose clear purpose is to clearly violate an existing law.
> they do carefully review sites before granting processing.
So it sounds like WikiLeaks has passed this process already.
So what made payment processors reconsider? Under the table requests from or favors to government officials?
In any event, it sounds like WikiLeaks has a perfectly fine cause to sue.
> They are private companies and they are not obliged to process for anyone.
All the more reason they can and should be sued. They probably wouldn’t have a problem if a clearly illegal site of the types you mentioned were to sue.
> In the case of Wikileaks, we know that Manning is sitting in jail pending trial
I’m not sure how that is closely related?
Manning may have done something illegal, or maybe even something wrong. Either way, Wikileaks is not yet convicted of or even charged with a crime. Some people may not like what Wikileaks has done. So what. If there’s more to it, then take official action.
If it is the payment processors taking action on their own initiative, then why complain about Wikileaks suing?
> As they are not the only methods to move money . . .
> the anti-trust aspects are pretty hard to support.
It’s like saying all airlines, trains and buses have refused to provide service. There are other forms of transportation. All food suppliers have refused to do business with you, but there are other methods of obtaining food. All cell phone companies won’t do business with you. Anti-trust is pretty hard to support.
> As for wikileaks getting coverage
You may be confused that getting coverage is Wikileaks purpose or focus. It may not be. Or it may be. Or getting on CNN may not be their focus. Who knows, maybe they’d be happy to not get coverage? In any event, I’m not sure what is the purpose of saying they are just crying for attention. There are more cost effective ways to get attention than this planned lawsuit.
The idea that (mainstream) news coverage is a goal may be based on faulty understanding as was the state department saying that Wikileaks should “return” digital documents.
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“Visa and Mastercard process for porn sites. However, they do so with many restrictions, and they do carefully review sites before granting processing. They do not want to be involved in processing for sites that could be illegal (child porn, bestiality, etc), which could create liablity for Visa.”
And porn is the perfect example that highlights what was wrong about Visa/MC’s actions.
Porn is legal in america, not in many others. Yet both process payments for it with no restriction beyond that it complies with US law.
KKK is banned in many european country’s, yet both will process payments for it
See the problem for many people here is Visa/MC/Paypal only seem to care when it is US law being broken (or when people say it is even if it was not as was the case with Wiki leaks), never anyone else’s, even when following US laws would break the laws of other counties
If they had really wanted to play “fairly” they would have done what they did with gambling. US citizens with cards based in the US and only US citizens blocked.
Thus no attempt to impose US “law” on the rest of the world.
Personally i hope MC/Visa/Paypal get royally spanked over this and either one of following things happen
a) They stop acting like financial weapon for the american government and just become impartial greedy payment processors
b) If they won’t stop then get kicked out of the rest of the world and local alternatives are nurtured and grown
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You’re missing the point here. Wikileaks (and thier processor) is not saying “we can’t get our money”… they’re saying that these major companies violated local laws (sound familiar?) in agreeing to block commerce with a single company… which is what they claim the law is supposed to prevent. Are they wrong? That’s for the judicial body to decide.
Here in good ol’ Merica, we say that you have the right to deny business to anyone as long as it’s not for reasons of discrimination based on a protected group… but even here, the majority of the Big Steel Companies (do those even exist anymore?) can’t all agree to stop selling steel to General Motors because they have a fundamental disagreement with that company’s methods or philosophies. Doing so would mean that they are working together to adversely influence the market… which is what the Anti-trust laws were made to stop (more or less). And this is (again, more or less) what WL is claiming happened.
Is it the same in the EU? I don’t know that for sure… but I bet the ruling body will let us (and everyone else) know.
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The assumption is that the companies got together and agreed, which is far from the truth. Each of them came to the same conclusion over time. They didn’t all turn off at the same minute, did they?
On a site where there is great support for “parallel discovery” in inventions, you seem to be discounting the concept of “parallel decision processes” at these companies. They all could see the same situation and the same circumstances. They work in similar ways and came to similar decisions.
There is no sign that these companies conspired to deny anything, just three payment processors each making independent decisions that happened over a period of time.
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> The assumption is that the companies got together
> and agreed, which is far from the truth.
It may or may not be far from the truth.
In any event, I don’t see the problem with someone suing for being denied service.
> There is no sign that these companies conspired to
> deny anything, just three payment processors each
> making independent decisions that happened over a
> period of time.
Gee, if you read that in just the right tone of voice, it implies they did what you suggest they did not. 🙂
Nevertheless, what is the problem with WIkileaks suing because of this decision that they all independently reached?
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I assume you have proof of that ‘truth’.
And if they all did agree to do it, wouldn’t it make sense to stagger the announcements to hide the agreement? But that’s a bit tin-foiley, don’t you think?
But I never said that those three companies agreed to do it… I’m saying that’s what WL & DataCell are claiming. I have no more proof that they did than you have proof they didn’t.
And it doesn’t have to be clandestine meetings in dark, smoke-filled rooms over snifters of brandy to be “agreeing”. If Visa says “we don’t want to do business with you”, and after they announce that, MC says “you know what, neither do we”… and later still, PayPal says “we’re with them!”… well, that’s a new kind of issue that the legislative body must decide upon, isn?t it? It presents a kind of grey area… where does the line get drawn between agreeing with an idea and hurting the market. I don’t envy any legislative body on having to make that call.
Again, you’re stating something as fact when you provide no evidence… altho, in your defense on this one, it’s harder to provide proof that something didn’t happen than proof that it did. But hey, that’s not your job… that’s for WL, DataCell and the EU to worry about. So how about we just stop saying this is a publicity stunt for WL until after the case is heard? or provide some proof that the companies all acted independently from each other? whichever is easier for you.
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That is also just an assumption, and even if true it doesn’t make it any more legal, not to mention ethical. The USian credo that “they can choose who they want to do business with” doesn’t apply to us EUlandians. We don’t worship at the altar of Ayn Rand, rather we take it as self-evident that the government can tell you that you can’t exclude someone from your business. Seriously, why would anyone look to the US for how to regulate financial institutions…?
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The assumption is that the companies got together and agreed, which is far from the truth. Each of them came to the same conclusion over time. They didn’t all turn off at the same minute, did they?
You know, that’s the thing about illegal conspiracies: the participants often don’t advertise the fact.
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There is no sign that these companies conspired to deny anything, just three payment processors each making independent decisions that happened over a period of time.
That’s for a court to decide.
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are paying attention to their spew anymore.
The spew the US government puts into diplomatic cables? Right.
Visa and Mastercard do control some 95% of the online payments market, and this is the area the plaintiff requires access too in order to remain competitive in business.
This third party procedure is not ‘slippery with the truth’ It’s a standard business practice, as you even admit to when mentioning the procedures required for it. What’s more, the company plainly stated up front that they were going to be processing payments for WikiLeaks.
There is no question at all about the legal status of Wikileaks. One individual has been in custody for almost a year over the major leak that has embarrassed the US government. In spite of the long delay, that individual has not yet been charged with anything. wikileaks has not yet been charged, let alone convicted, of any offense whatsoever. Unless you are willing to throw out the basis for the entire legal system in the western world, Wikileaks has to be considered as innocent until guilt is proven in a court.
It sounds to me like WikiLeaks is fighting back against a government determined to kill it by any possible means.
If WikiLeaks does win this case, then Visa and Mastercard are going to be caught between a rock and a hard place. If they don’t restore service to WikiLeaks, they’ll get hammered by the EU legal system, but if they do restore service, they’ll get hammered by the US political system. Either way, the companies can’t win unless they can show in court that there’s a specific, legal, reason why they terminated the service.
Bitcoin to the rescue?
The abuse the public gets from governments and corporate interests is why we need technologies like Bitcoin. The power goes back to the people and that IS a GOOD THING!!!
Re: Bitcoin to the rescue?
The abuse the public gets from governments and corporate interests is why we need technologies like Bitcoin. The power goes back to the people and that IS a GOOD THING!!!
That’s also why the government isn’t going to allow “technologies like Bitcoin” to take hold. They’ll start throwing people in prison before that happens.
This is going to be a tough sell. What’s the anti-competitive behavior. All I see from Visa and Mastercard is jerk behavior.
This will probably be the case that will change the TOS so the payment processors can drop a company for a stone for any reason. Wikileaks had better win big because every online company is going to get laid bare.
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Terms of Service conditions are abolutely voidable if they conflict with Statutory Law. In fact if they did try to change their TOS[‘s] for this reason it would be more evidence of collusion.
EU laws are totally different to USA laws. EU laws (like Aust/NZ ones) are more balanced for consumers and individuals.
VISA, M/C and Paypal in this instance have a lot to worry about since this could turn into a test case for consumer laws in the EU. Also I guarantee this complaint is step one in the legal action that Datacell is initiating.
The next step could possibly be a class action by the actual affected card holder[s] who have not been able to legally give money to a legal organisation in breach of their contract with the card companies under EU law [and maybe Aust/NZ too]. Watch this space!