PayPal sued over frozen funds: "Less than a week after its blockbuster debut on the Nasdaq stock exchange, online payment firm PayPal has been hit with a class-action suit charging it with improperly administering users accounts and poor customer service." Whoah. <thanks, david (and others)>

In other links, this excerpt from their IPO prospectus underscores why PayPal may be a bit persnickety about security: "During the four months between July and October 2000, we experienced a significant fraud episode and, as a result, we incurred gross losses due to unauthorized charge-backs totaling $5.7 million." <thanks, scott>