Caving to pressure from supporters, PayPal releases WikiLeaks’ funds [Update: PayPal down]

UPDATE: As of 12:10am PST on December 9, Paypal.com is widely unreachable according to our own checks and numerous reports on Twitter. We have more information about the attacks here.

UPDATE: PayPal, hours after being unreachable, is back online and can be reached following the previously reported downtime.

In a reversal of course, PayPal has released funds remaining in an account associated with WikiLeaks according to a post on PayPal’s blog.

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Last week, a statement from PayPal indicated, the company had suspended the account following claims by the U.S. that the activities of WikiLeaks violated the law.  According to the report, PayPal acted of their own volition, without being contacted by any government agency.

Further, the spokesman for PayPal indicated that the company had “permanently restricted the account used by WikiLeaks due to a violation of the PayPal Acceptable Use Policy, which states that our payment service cannot be used for any activities that encourage, promote, facilitate or instruct others to engage in illegal activity.”

Now it appears attacks from the supporters of WikiLeaks have caused PayPal to re-think their position.

From the PayPal blog post:

“While the account will remain restricted, PayPal will release all remaining funds in the account to the foundation that was raising funds for WikiLeaks.”

“We understand that PayPal’s decision has become part of a broader story involving political, legal and free speech debates surrounding WikiLeaks’ activities. None of these concerns factored into our decision. Our only consideration was whether or not the account associated with WikiLeaks violated our Acceptable Use Policy and regulations required of us as a global payment company. Our actions in this matter are consistent with any account found to be in violation of our policies”

Release of the funds come after a slew of denial-of-service (DOS) attacks earlier this week aimed at WikiLeaks’ providers. The providers have refused to conduct any business with WikiLeaks after the U.S. government stepped up its pressure on the site, claiming the site’s actions are in violation of U.S. law.

What are your thoughts?  Is PayPal right to reverse course and release WikiLeaks’ funds?  Do you think WikiLeaks has violated any U.S. laws, and if so, which ones?