DOJ Receives $30 Million Settlement From PayPal Over Minority Business Program

The Justice Department has reached a settlement with PayPal after targeting the payment platform for a business program aimed at supporting Black and minority-owned small businesses. As part of the $30 million deal, PayPal will launch a new small business initiative that doesn’t include a whiff of the diversity, equity and inclusion language so scorned by the current administration.

The DOJ program took umbrage with the Economic Opportunity Fund, launched by PayPal in 2020. The effort planned to invest $530 million in Black and minority-owned businesses, particularly those struggling during the COVID-19 pandemic. “For far too long, Black people in America have faced deep-seated injustice and systemic economic inequality,” PayPal CEO and Chairman Dan Schulman said at the time. “PayPal is uniquely positioned to help in this area, and we are committed to doing our part to address the unacceptable racial divide by advancing a more just economy and society.”

Rather than continue this work, PayPal will now waive processing fees on $1 billion in transactions for good old American small businesses that carry government-approved adjectives. This includes veteran-owned businesses and those engaged in agriculture, manufacturing or technology.

We have started to see more settlements reached as the Department of Justice bilges money from organizations that run DEI programs. For example, IBM agreed to pay more than $17 million last month to settle the agency’s accusations that “race, color, national origin or sex” played a role in its recruiting programs. The offending programs included “race and gender demographic goals for business units” and the use of “a diversity modifier that tied bonus compensation to the achievement of demographic goals.” Neither PayPal nor IBM have admitted any wrongdoing.