PayPal distanced itself from the porn and gambling industries shortly after it was acquired by eBay in 2002, although its newest stand is angled more directly at consumers and businesses who have ignored earlier warnings to find alternate payment processing services.
The eBay subsidiary stated that it would begin imposing fines against individuals for up to $500 for all gambling and porn, in addition to the buying and selling of non-certified prescription drugs.
Critics are saying that PayPal's recent mandate is the direct result of pressure from regulators who are increasingly putting the pinch on large credit card companies to distance themselves from the porn and gambling industries.
"What you're seeing here is an evolution of our program," a PayPal spokesperson said. "We're trying to deter people who would offer PayPal as a way to pay for anything in these categories."
PayPal's new levy takes effect on Sept. 24, the company said. This is the first time PayPal has imposed fines against buyers and sellers who misuse its service.
In the past, PayPal reportedly reaped in huge profits from porn and gambling transactions. At one point in its financial history, gambling transactions accounted for 10 percent of its overall revenue.
A PayPal spokesperson said that the fines would be applied on a per-violation basis and that PayPal would pursue legal action against those who do not remit fines in a timely manner.