EFF Calls Out Payment Processors for Not Publishing Transparency Reports

Rainey Reitman lays out the case for why payment processors such as Stripe and Paypal need to start publishing transparency reports that detail how often law enforcement agents are requesting data from them, and how often they are giving law enforcement data about users. To be honest, before reading her article I would have assumed that payment processors were already doing this since transparency reports are such a common feature today.

Payment processors like Stripe, Paypal, Bitpay, and Coinbase are the intermediaries that allow you to support your favorite websites, send donations, and make purchases online. They’re often privy to details of your financial life, which can be deeply revealing. Your finances can say a lot about your daily habits, your political orientation, your physical location at different moments in time, your associates, and your health concerns. Given how sensitive this information is, you might assume that law enforcement agents must show probable cause to a judge and receive a search warrant before accessing financial records. But you’d be wrong. Financial data is frequently obtained through a less stringent process, such as a subpoena, a 314 (a) request, or a National Security Letter, none of which require review from a judge before being sent to the financial service provider. Furthermore, the financial industry is already heavily regulated and laws currently mandate that various financial institutions, from banks to money transmitters, must keep extensive customer records and proactively report information about large or suspicious transactions to the government. Over the last two decades, the volume of these reports has grown rapidly, now surpassing millions per year. In effect, thousands of companies have been deputized to bulk collect and report reams of private financial information to the government.
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Tracking transparency reports year over year is vital to the public’s understand of government efforts to surveil and censor. Analysts can use these reports to learn a lot: Are requests for user data increasing in particular sectors? How many accounts are impacted, and are all those accounts bundled into just a few requests? Are payment processors resisting certain government requests, or complying with every one?

Ideally, payment processors would choose to embrace even more transparency. For example, we’d like to see a commitment to publicly report on government requests that don’t come with an official subpoena, such as when Cook County Sheriff Thomas Dart violated the First Amendment by bullying credit card companies to shut down an account. We hope that financial companies would detail their process for handling government requests and include a process for account holders to appeal those decisions. We urge payment processors to report on how many Suspicious Activity Reports they file annually and how many unique customers those reports relate to. It would also be extremely helpful for payment processors to report on requests that may originate outside of the government, and to provide aggregate numbers on how many accounts are frozen and shut down in a year that aren’t about fraud.

PayPal Founder Pledges $3.5 Million for Life Extension Research

Peter Thiel, a co-founder of PayPal, announced in September that he would donate $500,000 per year over the next three years to the Methuselah Foundation. The Methuselah Foundation is attempting to encourage research into anti-aging technologies by awarding prizes linked to specific goals, typically extending the lifespan of laboratory animals.

In addition, Thiel has promised matching funds of 50 cents for every dollar donated to the Methuselah Foundation from now through 2009.

The San Francisco Chronicle article on the donations includes a lot of background on the Methuselah Foundation’s Aubrey de Grey, who has become more controversial among researchers doing research on aging as his claims have become a bit more extravagant.

For example, here’s the SF Chronicle on de Grey critic S. Jay Olshansky, who 60 Minutes also used as its obligatory critic in their profile of de Grey,

S. Jay Olshansky, a demographer at the University of Illinois who confronted de Grey on CBS’s “60 Minutes” earlier this year, added: “Where I have vehemently disagreed with Aubrey is where he tries to convince people, especially reporters, that we are on the verge of immortality — that we have people alive today who will live for 1,000 or for 5,000 years.”

At present scientists don’t even know what causes aging, but “Aubrey seems to think that he does — that there are seven (causes for aging), that we have to reengineer the body to eliminate them, and that we’ll live forever.

“In the world of science,” Olshansky said, “you don’t make declarative statements (like that) without evidence to support them.”

Fine, 1,000 years is unrealistic — I’d be willing to settle for 300.


Entrepreneur backs research on anti-aging. Keay Davidson, San Francisco Chronicle, September 18, 2006.

PayPal Founder Pledges $3.5 Million to Antiaging Research. Press release, Methuselah Foundation, September 18, 2006.