FC: Louisiana government accuses Paypal of running unauthorized bank

From: Declan McCullagh (declanat_private)
Date: Tue Feb 12 2002 - 05:05:22 PST

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       By Troy Wolverton 
       Staff Writer, CNET News.com
       February 11, 2002, 5:45 PM PT
       In a letter sent last week, Louisiana asked the online payments
       company to cease offering its service to the state's residents until
       PayPal receives a license from the state, the company said in a
       regulatory document filed Monday. Although Louisiana residents account
       for a small fraction of the money sent through PayPal, the state's
       move could presage other governmental attempts to regulate PayPal's
       But PayPal also faces potential challenges from state banking
       regulators. During the past two years, California and Idaho have
       questioned whether PayPal is operating an unauthorized bank.
       Meanwhile, officials in Louisiana and New York have gone a step
       further and stated their opinion that PayPal is doing just that.
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