PayPal Says Plan for Misinformation Fines Was Published in Error

PayPal Holdings Inc. said it has no intention of fining customers for spreading misinformation, after attracting criticism for publishing a new user agreement outlining such a plan.

The issue gained traction over the weekend after the company published policy updates prohibiting users from using the PayPal service for activities identified by the company as “the sending, posting, or publication of any messages, content, or materials” promoting misinformation, in an Acceptable Use Policy due to kick in on Nov. 3. A penalty of $2,500 could be imposed for each violation, according to the update.

The notice included “incorrect information,” a spokesperson ...