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PayPal Sued for Freezing Customer Accounts Without Explanation

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PayPal Holdings Inc. Illustrations Ahead Of Earnings Figures
Photographer: Gabby Jones/Bloomberg

PayPal Holdings Inc., a popular digital payment platform, violated racketeering laws by freezing customer money and refusing to provide an explanation for the move, three account holders alleged in a federal lawsuit.

PayPal, which has an estimated 325 million account holders worldwide, put a hold of as long as six months on funds for alleged violations of its 65-page user agreement, according to the complaint filed Thursday in California.