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PayPal Fined $2M for Cybersecurity Lapse Exposing User Data

PayPal has agreed to pay a $2 million penalty to the New York State for cybersecurity failures leading to customer data exposure.

PayPal, Inc. has agreed to pay a $2 million penalty to the New York State Department of Financial Services (DFS) after an investigation found that cybersecurity failures led to the exposure of sensitive customer information, including Social Security Numbers (SSNs). The breach stemmed from a December 2022 cybersecurity event in which unmasked customer data was accessible to cybercriminals due to internal mismanagement of security protocols. The agency found that PayPal’s internal cybersecurity policies were not properly enforced, and critical risk assessments — such as penetration tests and vulnerability scans — were not conducted before launching the system update.

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