Why You Can Venmo for “Cocaine” or “Bomb” but Not a “Cubano Sandwich”

And don’t even think about saying “Iran” on PayPal.

A PayPal sign is posted outside of the company's headquarters.
PayPal is especially sensitive to payments that could violate foreign sanctions.
Justin Sullivan/Getty Images

Reminder: If you want to PayPal or Venmo some cash to someone without any hitches, do not put the word Iran in the memo field. On Wednesday, Jewish Currents got an annoying reminder of this rather blunt policy. The magazine tweeted that nine payments to its staff and contributors had been held up by PayPal because the transaction descriptions included the term Iran in reference to a piece that the magazine published.

PayPal, along with its subsidiary Venmo, uses a system that automatically flags keywords in the payment memo field that could indicate a violation of U.S. sanctions. Upon detecting a suspicious transaction, PayPal sends an email to both the sender and receiver reading, “To comply with government regulations, PayPal is required to review certain transactions. The payment you sent is currently being reviewed and we will complete this process within 72 hours.” So if, say, you try to send a friend money for “drinks at Cuba Libre,” you’ll quickly learn how dense PayPal’s system can be when it comes to context clues.

This longstanding PayPal policy has caused numerous headaches in the past. Users have run into trouble sending payments reading “Persian Nowruz”—a New Year’s holiday—because of the term Persian and making donations to Syrian refugees because of the term Syrian.

When asked about Jewish Currents’ conundrum, PayPal told Slate in a statement, “PayPal takes its regulatory and compliance obligations seriously, including U.S. economic and trade sanctions administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC). Our goal is to deliver as seamless of a payments experience as possible while we do our job in making sure payments made on our platforms comply with applicable law. We realize any delay in making or receiving a payment can be frustrating, and we appreciate our customers’ patience as we comply with our regulatory obligations.” Jacob Plitman, the publisher of Jewish Currents, told Slate that the payment specifically referring to Iran eventually went through, but that the eight others that came after are still under review. PayPal said those remaining delays are “related to standard bank transfer times for eCheck payments.”

PayPal mainly relies on lists of embargoed countries, organizations, and individuals that the Treasury Department’s Office of Foreign Assets Control has compiled to determine what payments require further review. Yet this leaves out a good number of illicit activities that the payment service could be facilitating—leaving the impression of a rather arbitrary flagging system. To get a better sense of what PayPal does and doesn’t deem suspicious, I sent my editor dozens of 1 cent transactions with different memo descriptions, which are listed below. It’s worth noting that this list is nowhere near complete, and PayPal has a number of other mechanisms to check for illegal behavior, such as fraud-prevention technology that uses machine learning.

As you can see, PayPal’s flagging has a fairly eager trigger finger when it comes to anything having to do with foreign sanctions and a laissez-faire stance toward weapons, drugs, human and animal trafficking, prostitution, and hate groups. It also seems that proper nouns referring to specific entities are under more scrutiny than general descriptions of criminal activity, which are perhaps more likely to be a joke. In fairness, it’s unlikely that someone actually in the market to blow something up would write bomb in the payment description, but then again a person trying to send funds to the Islamic State isn’t likely to attach the flagged term ISIS to their donation either.

Words and phrases that were flagged

Iran

ISIS

Persian

North Korea

Kim Jong-un

Bashar al-Assad

Qasem Soleimani

Real Irish Republican Army

Cuba

Cubano sandwich

Syria

Syrian refugee

Al-Qaeda

Sinaloa Cartel

Los Zetas

Shining Path

Words and phrases that were not flagged

Bomb

Car bomb

Weapons of mass destruction

Assassination

Hitman

Kidnapping

Terrorist

Cartel

Anthrax

Ricin

Sarin gas

AK-47

Glock 43

Dog fight

Nazis

Stormfront

Atomwaffen

Unite the Right

Proud Boys

KKK

Klansmen

David Duke

Prostitutes

Handjob

Blowjob

Revenge porn

Snuff film

Human trafficking

Slave

Fetus

Stem cells

Kidney harvest

Napalm

Coyote

Marijuana

MDMA

Ecstasy

LSD

Meth

Black tar heroin

Ketamine

Cocaine

Fake ID

Wire fraud

Little Women bootleg DVD

Fake Yeezys

Rhino horn

Elephant tusk

Pangolin

Shark fin

Irish Republican Army

MS-13

Iraq

Sudan

Yemen

Hezbollah

Venezuela

Somalia

Future Tense is a partnership of SlateNew America, and Arizona State University that examines emerging technologies, public policy, and society.