ProtonMail hit by PayPal account freeze

July 1, 2014 | 11:51

Tags: #crowd-funding #crowdfunding #cryptography #edward-snowden #encryption #privacy

Companies: #cern #government #nsa #paypal #protonmail #us-government

ProtonMail, a secure email start-up founded in 2013 by scientists at CERN in Switzerland, has claimed that eBay-owned payment processor PayPal has bowed to government pressure and locked its crowd-funding account - and in doing so has threatened the future of the project.

The brainchild of Andy Yen, Jason Stockman and Wei Sun, ProtonMail is a web-based email service which offers centralised cryptography management. Its promise is that any device, including tablets and smartphones, can use the system to send and receive entirely secure messages with none of the complexity normally associated with public key cryptosystems such as key management and distribution. Combined with its hosting in Switzerland, which has impressively strong privacy laws, the team behind it claim it's the perfect answer to recent revelations regarding the NSA and associates' tendencies to snoop outside their original charters.

It's a promise that has considerable backing: a crowd-funding campaign with a $100,000 goal was smashed with the project currently sitting on a whopping $251,721. Unfortunately, that cash is now locked as the result of PayPal freezing the team's account. 'Like many others, we have all heard the PayPal horror stories, but didn’t actually think it would happen to us on our campaign since PayPal promised, very recently, to improve their policies. Unfortunately, it seems those were hollow promises as ProtonMail is now the latest in a long string of crowdfunding campaigns to be hit with account freezes,' Yen wrote in a blog post on the matter.

'When we pressed the PayPal representative on the phone for further details, he questioned whether ProtonMail is legal and if we have government approval to encrypt emails. We are not sure which government PayPal is referring to, but even the 4th Amendment of the US constitution guarantees: “The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures…” It seems PayPal is trying to come up with ANY excuse they can to prevent us from receiving funds.'

PayPal has thus far been silent on the why and wherefore of the account freeze, with Yen and the team unable to elicit a response from the company. The move has raised concerns that PayPal may be bowing to pressure from elements within the US government to halt funding to the project, which aside from its payment processors is entirely outside their jurisdiction.

For now, the team has been forced to remove PayPal from its campaign page on Indiegogo with no promises that they will receive the funds currently locked away in their PayPal account.

ProtonMail has now confirmed that PayPal has lifted the restrictions on its account, claiming that publicity surrounding the freeze was likely responsible for the company's sudden volte-face.
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