TechDirt has solid coverage of the latest news in Internet censorship — credit card companies are pressuring PayPal to force ebook publisher Smashwords to stop selling titles whose themes may be deemed obscene. Put simply, this is wrong. Who appointed credit card companies the arbiters of what speech is acceptable? follow link
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Credit Card Companies Pressure PayPal to Censor Ebook Publishers
Comments about Credit Card Companies Pressure PayPal to Censor Ebook Publishers
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I think that PayPal is lying about being forced by the credit card companies.
Paypal is doing this for economic reasons. It is well known that there are higher chargebacks on purchases of racy literature. Credit card companies can charge sellers higher rates for this, so if Paypal allows these sales, their credit card rates will go up on all credit card sales, not just the ones for these books.