European banks affected by PayPal fraudulent payments worth ‘billions’

European banks have seen a widespread direct flow from PayPal’s accounts, says the German Savings Banks Association (DSGV).

The German newspaper Speeddeutsche Zeitung (SZ) says payments worth in the region of € 10 billion (8.6 billion British pounds) They had to be blocked after the PayPal fraud check system failed.

It says payments were on Monday when creditors reported millions of suspicious direct debt from the payment firm.

DSGV confirmed to the BBC that there were “incidents involving unauthorized direct debits initiated by PayPal against various credit institutions.”

BBC addressed Paypal for comment.

He told Reuters “certain transactions from our banking partners and potentially their customers” were affected by a temporary interruption of the service.

“We quickly identified the cause and are working closely with our banking partners to ensure that all accounts are updated,” said PayPal spokesman.

DSGV said Paypal “admitted the interruptions” and “assured” that it had solved the problem.

“Payment transactions to and from PayPal are again executed normally,” the message said.

“These incidents have a significant impact on payments transactions across Europe, especially in Germany.

“Supervisors are also informed of PayPal incidents.”

Paypal aims to filter fraud before they can reach banks through a security system.

Moreover, it aims to deal with the false direct flow rates created by criminals.

There are many ways in which they are created, but a typical method is to entice one to hand over his details by pretending to be a bank or financial institution by phone.

According to the SZ, the PayPal filter system did not work properly on Monday, which leads to a check of direct debits sent to the banks together with the legal ones.

The shares in the payment firm fell 1.9% on Wednesday after the report.