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PayPal Targets Music Pirates

IFPI announced that PayPal is working with the City of London Police and the international recording industry to prevent PayPal’s services from being used by websites that sell copyright infringing music.

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Unedited press release follows:

PayPal works with police and industry to tackle copyright infringing websites

21st July 2011

Online payment service PayPal has agreed a partnership with City of London Police and the international recording industry that will see even stronger action to prevent PayPal’s services being used by illegal websites worldwide that sell copyright infringing music.

PayPal has always banned the use of PayPal for items that infringe or violate any copyright under its Acceptable Use Policy.

The agreement follows the announcement in March that payment providers MasterCard and Visa would ensure their payment services were also withdrawn from such sites.

Many of these illegal websites are based in Russia and Ukraine and have violated local and international copyright laws for many years by selling music without paying artists, songwriters or producers for their work. These websites appear in multiple languages and contain details of the latest music charts in markets around the world.

Frances Moore, chief executive of IFPI, which represents the recording industry worldwide says: “We knew that when illegal online music services could no longer take payment from credit cards they would try to work around the restriction. That is why we and the City of London Police approached PayPal and I am delighted to say they responded instantly and positively.

“The work the City of London Police is undertaking is at the cutting edge of tackling online copyright infringement, a serious problem that is eroding the ability of record companies to invest in a diverse range of artists with serious consequences for jobs, tax revenues and consumer choice.”

Since the March announcement with MasterCard and Visa, their payment services have been withdrawn from 24 illegal music services and IFPI investigators have just handed details of a further 38 sites suspected of infringing copyright on a grand scale.

IFPI anti-piracy investigators are able to supply the City of London Police’s Economic Crime Directorate with evidence of illegal downloads made from an infringing site. Once the police have verified the evidence, they are able to notify the payment providers who can then take action.

MasterCard and Visa will require the acquiring bank providing the retailer with payment services to produce evidence of appropriate licenses to sell music. If appropriate licenses are not in place then MasterCard and Visa can request they cease providing those services to the retailer.

PayPal will require the retailer to submit proof of licensing for the music offered by the retailer. PayPal will discontinue services to retailers in cases where licensing appears to be inadequate.

Carl Scheible, PayPal UK’s managing director, commented, “Today’s announcement shows that PayPal is very serious about fighting music piracy. We’ve always banned PayPal’s use for the sale of content that infringes copyright, and the new system will make life even harder for illegal operators. Our partnership with the music industry helps rights holders make money from their own content while stopping the pirates in their tracks.”

PayPal has pioneered new ways to pay for music, including its faster checkout for digital content: PayPal for Digital Goods.

Detective Chief Superintendant Steve Head of the City of London Police adds: “We are fully committed to pro active initiatives such as these where we work with the private sector to prevent offending, stop legitimate business services such as PayPal being exploited by criminals and minimise harm to entire business sectors such as the music industry. The benefits are palpable not only in terms of delivering an effective response to victims and the business community as a whole, but also in enabling the City of London Police Economic Crime Directorate to maximise our resources in tackling a wide range of criminality”.