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PayPal partners with police against illegal downloads

PayPal partners with police against illegal downloads

Russian and Ukrainian illegal music sites are being targeted by the City of London Police and PayPal.

PayPal has partnered with the City of London Police to help prevent payments being made to illegal music download services.

Such services, many of which operate from Russia or the Ukraine, often offer unlimited music downloads for a monthly fee, but pay no royalties to artists or record labels. This is achieved by exploiting lax copyright laws in host countries, despite the services being offered to foreign users.

Credit and Debit card providers Visa and MasterCard have already withdrawn their payment services for a large number of these sites earlier this year, and PayPal's announcement is sure to dent these websites' cash-flow too.

'We knew that when illegal online music services could no longer take payment from credit cards they would try to work around the restriction,' said Frances Moore, chief executive of the International Federation of the Phonographic Industry (IFPI). 'That is why we and the City of London Police approached PayPal and I am delighted to say they responded instantly and positively.'

PayPal will withdraw its payment services from download providers that do not submit proof of licensing, with 24 sites already affected and 38 more under investigation.

However, such services still operate in a legal grey area in their home countries, so it's unlikely they'll be taken down permanently.

Do you think PayPal is right to withdraw its services? Is such a withdrawal of payment services from illegal operations long overdue? Let us know in the forums.

15 Comments

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montymole 28th July 2011, 12:04 Quote
As they bolt one gate the horse will find a new way out of the paddock, The people who want to use such methods will always find a way it they nature of the internet, hard to hold back a stampede!
atlas 28th July 2011, 12:06 Quote
When did Paypal become our watchdogs?
montymole 28th July 2011, 12:16 Quote
i am certain knowing how they like to make money that paypal is being used for many shady deals all over the world almost all private torrent trackers use paypal for donations are they looking into that as well.
Necrow 28th July 2011, 13:16 Quote
Torrent sites, FileLocker link sharing sites etc.. all have donations via PayPal, thay can try but they won't be able to stop these sites and downloaders. As Montymole said above, one door closes and another opens. Pretty soon these sites will be registering as charities, try stopping PayPal donations then pffffff
Mentai 28th July 2011, 14:45 Quote
I don't like how companies block payments like this because they did so to WikiLeaks. As far as I'm concerned WikiLeaks are under freedom of press and you should be able to send your money where ever you want. The same goes for sending money for music. If it's illegal, the copyright holders should press charges. When corporations/governments can't deal with their problems legitimately it seems that Paypal and credit card companies are only too happy to buddy up with them and I find it obscene. That should not be their role.
azazel1024 28th July 2011, 16:43 Quote
Except under plenty of national laws the companies could be accused or even prosecuted for facilitating criminal activity if they are aware that they are accepting payments for companies that are engaged in illegal activies. So if they are told a company is permulgating copyright fraud and continue to accept payments for them, they could potentially be charged.

How would this be different than Paypal being notified that they were accepting payments for a drug cartel and didn't stop accepting payments? The severity of the illegal activity is an a completly different level, but the fact is that BOTH are engaged in activities that are illegal. You can also argue that copy right fraud shouldn't be a criminal offense or should not be an offense of any kind all you want. But as it stands in the US and most countries it is illegal. Even as a non-criminal penalty the RIAA and others could potentially go after paypal for civil litigation if they knowningly continue to accept payments on behalf of the copyright infringers.
azrael- 28th July 2011, 16:44 Quote
Quote:
Originally Posted by atlas
When did Paypal become our watchdogs?
^ This!
Quote:
Originally Posted by Mentai
I don't like how companies block payments like this because they did so to WikiLeaks. As far as I'm concerned WikiLeaks are under freedom of press and you should be able to send your money where ever you want. The same goes for sending money for music. If it's illegal, the copyright holders should press charges. When corporations/governments can't deal with their problems legitimately it seems that Paypal and credit card companies are only too happy to buddy up with them and I find it obscene. That should not be their role.
^ As well as this!

We don't need PayPal to save us from purportedly illegal dealings. Especially when PayPal is still used for, and earns a pretty penny off of, tons of other socalled "shady" dealings.
John_T 28th July 2011, 18:56 Quote
Quote:
Originally Posted by azazel1024
Except under plenty of national laws the companies could be accused or even prosecuted for facilitating criminal activity if they are aware that they are accepting payments for companies that are engaged in illegal activities. So if they are told a company is promulgating copyright fraud and continue to accept payments for them, they could potentially be charged.

How would this be different than PayPal being notified that they were accepting payments for a drug cartel and didn't stop accepting payments? The severity of the illegal activity is an a completely different level, but the fact is that BOTH are engaged in activities that are illegal. You can also argue that copy right fraud shouldn't be a criminal offence or should not be an offence of any kind all you want. But as it stands in the US and most countries it is illegal. Even as a non-criminal penalty the RIAA and others could potentially go after PayPal for civil litigation if they knowingly continue to accept payments on behalf of the copyright infringers.

That 100%.

You can't blame a company for complying with a police request - not when that request is pointing to a clear and unambiguous breach of the law.

Wikileaks is slightly different, as despite being against the law there are arguments that can be made about certain segments of it being in the national interest - hence a firm could reasonably refuse a police request and demand a court order, or a court hearing, if they felt strongly enough about the issue, (which, let's be honest, most won't).

This however is about foreign companies stealing other peoples Intellectual Property and selling it as their own for their own financial gain. It's a bit hard for a legitimate company to do anything other than comply with the police really...
AstralWanderer 29th July 2011, 09:54 Quote
Quote:
Originally Posted by John_T
This however is about foreign companies stealing other peoples Intellectual Property and selling it as their own for their own financial gain.
The companies concerned are complying with the law in their own jurisdiction so cannot be accussed of stealing. What is happening is globalisation working in consumers' interests - giving them the option to save money by using other countries' more liberal licensing laws.

It is worth noting that no criminal act is being committed by users of these services in the UK (they are exempted under section 22 of the Copyright, Designs and Patents Act 1988) which probably explains the music industries' tactics - they cannot take action against end users so they target the payment processors instead.

Section 22 states:

"The copyright in a work is infringed by a person who, without the licence of the copyright owner, imports into the United Kingdom, otherwise than for his private and domestic use, an article which is, and which he knows or has reason to believe is, an infringing copy of the work."

So as long as overseas purchases are for private use (a condition invariably imposed on domestic purchases also) they are permitted.
SolidShot 29th July 2011, 14:40 Quote
Its the city of london police anyway, which police a tiny section of london. They might as well have teamed up with the Scotlish Highlands police force...
John_T 29th July 2011, 18:45 Quote
AstralWanderer, I think you're missing the point. Just because the services are based in countries without up to date technology laws it doesn't stop it being theft of someone else's property.

These companies aren't paying anyone anything for their core product, they're just taking it and reselling it themselves - undercutting the people who actually make it.

If they take something from someone without paying for it, and then they themselves sell it on for a profit, that is profiting from theft. The fact that they may able to get away with it in their own country due to a lax legal system doesn't stop it being theft.

I don't want to get into a whole debate about the morality of piracy, (listening to the radio never stopped me from buying CD's) but I think there is a world of difference between downloading something for personal use and downloading something and then reselling it on for profit - and on an industrial scale.

Also, I don't believe anyone said the users were committing criminal acts, but then the police and PayPal aren't targeting the users - they're targeting the companies involved, who under international laws are committing criminal acts.
John_T 29th July 2011, 18:54 Quote
Quote:
Originally Posted by SolidShot
Its the city of london police anyway, which police a tiny section of london. They might as well have teamed up with the Scotlish Highlands police force...

What has that got to do with anything? The City of London police may be a (relatively) small force, but operating in the square mile I'd be willing to bet that they're one of the most technologically advanced.

Even if they weren't, what does it matter? Whether it's someone from the Met or one bloke and his Border Collie from the Scottish Highlands, a copper is a copper...
AstralWanderer 30th July 2011, 11:12 Quote
Quote:
Originally Posted by John_T
AstralWanderer, I think you're missing the point. Just because the services are based in countries without up to date technology laws it doesn't stop it being theft of someone else's property.
"Piracy" (unauthorised duplication) is not theft (more discussion here and here).
Quote:
Originally Posted by John_T
These companies aren't paying anyone anything for their core product, they're just taking it and reselling it themselves - undercutting the people who actually make it.
Untrue - these sites pay for licensing in a similar way radio stations do. To take an example, here's a quote from MP3Sparks' Terms of Use:

"The availability over the Internet of the Mp3Sparks.com materials is authorized by the license 31/ZM-07 of the noncommercial partnership Rightholders Federation for Collective Copyright Management of Works Used Interactively (NP FAIR) . Under the licenses' terms, Regiontorg pays license fees for all materials downloaded from the site subject to the Law of the Russian Federation "On Copyright and Related Rights". All these materials are solely for personal use. Any further distribution, resale or broadcasting are prohibited."

Are the artists receiving payment? No - but then they don't receive anything more than token payment with "approved" services either. If you really want to support an artist, the only way (in most cases) is by donating directly or buying related goods (T-shirts, etc) on their website (if they own it themselves).
Quote:
Originally Posted by John_T
I don't want to get into a whole debate about the morality of piracy, (listening to the radio never stopped me from buying CD's) but I think there is a world of difference between downloading something for personal use and downloading something and then reselling it on for profit - and on an industrial scale.
This isn't about morality - it's about economics. Sites operating under more liberal copyright regimes can offer a better service (greater choice of bitrates specifically) at a cheaper price.
Quote:
Originally Posted by John_T
... they're targeting the companies involved, who under international laws are committing criminal acts.
If that was the case, it would be Interpol who would be involved. The music industry are playing a PR game (as in their previous action against AllOfMP3) - trying to frighten customers away from a legal service in order to maintain margins at the (almost criminally) overpriced "approved" ones.
Luxury Holidays 30th July 2011, 19:13 Quote
Illegal people will always find new ways; but sometimes these measures hurt new businesses;

Paypal is just trying to be seen to be doing something otherwise eBay their parent company can do much more to prevent illegal trading
SimonStern 31st July 2011, 21:22 Quote
Quote:
Originally Posted by John_T
The fact that they may able to get away with it in their own country due to a lax legal system doesn't stop it being theft.

That made me laugh. If their legal system doesn't say it's theft that actually DOES stop it from being theft :)
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