Mr. (Scott) Thompson (president of Paypal) said risk management had been the key to the company’s success. Even before it was purchased by eBay, PayPal was willing to let individuals selling on eBay accept credit cards, when banks and eBay itself found that concept of trusting someone who appeared out of nowhere over the Internet too frightening. (There is greater potential for fraud by a seller than a buyer, because someone could sell a lot of stuff then disappear without shipping it.)
What PayPal has learned is that the Internet actually reduces risk, Mr. Thomson said, because
it provides so much information to identify potential fraud artists.
“If it’s a fraudster, you can’t find footprints,” Mr. Thompson said. “They go out of their way not to leave traces about who they are.”
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