PayPal pays $7.7m in US sanctions case
PayPal has agreed to pay $7.7 million to settle charges from the US Treasury that lax screening technology saw the firm violate multiple sanctions programmes.
According to a Treasury statement, over several years up until 2013, PayPal processed 486 transactions worth a total of just under $44,000 in apparent violation of sanctions because it “failed to employ adequate screening technology and procedures”.
Among the sanctions programmes involved were those against Iran, Cuba and Sudan. In addition, PayPal processed 136 transactions connected to an account registered to Kursad Zafer Cire, a Turkish man on a sanctions list for weapons of mass destruction proliferation.According to the Treasury, PayPal failed to flag Cire because a filter was not “working properly”. Later, the technology did flag Cire’s account on five separate occasions, but each time risk agents dismissed the alerts without requesting additional information. On a sixth occasion extra information was requested but it was not until the seventh flagging that the account was blocked and reported.
The Treasury says that the apparent Cire violations were “egregious” and that PayPal “demonstrated reckless disregard for US economic sanctions requirements”.
PayPal did not admit or deny the allegations and the Treasury says that the firm cooperated with its investigation, has hired new compliance management and strengthened its screening processes and measures.
Source: FinExtra – PayPal pays $7.7m in US sanctions case
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