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PayPal Accused in Suit of `Crucial’ Role in Massive Ponzi Scheme

May 5, 2017, 9:49 PM

PayPal Holdings Inc. was accused by victims of an alleged Ponzi scheme of failing to detect the fraud while processing more than $100 million in investments (Ezeude v. PayPal, Inc., N.D. Cal., No. 5:17-cv-02558, complaint 5/4/17).

Even after the company had banned the operator of the internet advertising “pay-to-click” program from using its services in 2011 over his involvement in a similar scheme, PayPal played “a crucial — indeed, indispensable — role” in letting him siphon and steal investor money, according to the May 4 complaint in federal court in San Jose, Calif.

The operator, Charles David Scoville, ...