PayPal to Pay $25 Million Over Illegal Online Credit Sign-ups

PayPal Inc. agreed to pay a $10 million penalty and provide wronged consumers with $15 million to settle a U.S. regulator’s claims that it illegally signed up customers for an online credit service.

PayPal deceptively advertised promotional benefits that it didn’t honor and didn’t seek permission from consumers before signing them up for a service formerly known as Bill Me Later, the Consumer Financial Protection Bureau said in a statement Tuesday.