Arik Hesseldahl

Recent Posts by Arik Hesseldahl

LulzSec Hackers Protest PayPal, as One of Them Is Arrested in U.K.

Scotland Yard says it has arrested a member of the LulzSec and Anonymous hacking gangs. The arrest of a 19-year-old man who goes by the online handle “Topiary” took place as part of what police called an “intelligence-led operation.”

Topiary has a Twitter account, though it appears to have only one Tweet made on July 22.

You cannot arrest an idea.

The arrest occurred as LulzSec and Anonymous jointly urged their supporters to boycott PayPal by closing their accounts and withdrawing any funds held in them and to use competing online money transfer products. PayPal, the payment unit of eBay, was the alleged victim of a series of denial of service attacks late last year for which numerous people in the U.S., U.K. and The Netherlands were arrested last week. The attacks were launched in sympathy for WikiLeaks after the PayPal account through which it accepted online donations was shut down.

“We encourage anyone using PayPal to immediately close their accounts and consider an alternative,” the group said in a statement released via Pastebin, which you can read in full below. “The first step to being truly free is not putting one’s trust into a company that freezes accounts when it feels like, or when it is pressured by the U.S. government.”

Anonymous claimed via its Twitter feed that 35,000 PayPal accounts had been closed.

Received some more information: At least 35.000 PayPal accounts have been closed today, likely much more to come. Proud of you! #OpPayPal

A PayPal spokesperson disputed that in an email statement: “We haven’t seen any changes to our normal operations (including account opening and closing).”

Even if Anonymous’ claim of that number of account closures were true, the impact would be minimal. PayPal says it has 100 million active accounts in 190 markets and 25 currencies around the world. A loss of 35,000 accounts would amount to 0.035 percent of the account base, and couldn’t possibly exceed the flow of account terminations in a normal day. At that number, account cancellations can’t possibly be material, so at this point don’t expect any additional statement on the subject from PayPal.

Even so, eBay shares are down about 2 percent today, but I wouldn’t draw any connection between the boycott and its share price. Google, Apple and the Nasdaq itself are all down about 2 percent today.

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There’s a lot of attention and PR around Marissa, but their product lineup just kind of blows.

— Om Malik on Bloomberg TV, talking about Yahoo, the September issue of Vogue Magazine, and our overdependence on Google