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Lots of people use PayPal but the online payment solution seems to care little about customer privacy.
The US government has demanded these records in reference to offshore transfers, and PayPal will be fully cooperating.
The Government is looking to crack down on those US citizens using offshore "tax havens".
During a 16 month period at the beginning of the decade, PayPal was all the rage for the online gambling industry. It was already an established and known payment processor that made betting with offshore sports books and online casinos especially simple.
Records dating back to that time will also be submitted to the IRS for review.
Gambling911.com at the time had long warned its readers to stay clear of PayPal due to years of complaints related to the company.
The news comes as prosecutors asked a Miami federal judge to require Swiss bank UBS AG to turn over information on its U.S. customers who may have used secret accounts to evade taxes.
The unprecedented step comes as a Justice Department investigation into the bank is heating up. Earlier this month, Bradley Birkenfeld, a former UBS private banker, pleaded guilty to conspiracy and said the bank helped wealthy U.S. citizens conceal $20 billion in assets and evade income tax laws.
It is the first time the Justice Department has sought to serve a so-called ``John Doe'' summons on a foreign bank, said Justice Department spokesman Charles Miller.
John DiCicco, deputy assistant attorney general in the Justice Department's tax division, said in a statement that the U.S. has been ``working cooperatively'' with UBS and the Swiss government to obtain the account information.
``However, we are prepared to seek enforcement if that process is not successful,'' DiCicco said.
UBS spokeswoman Rohini Pragasam said the bank ``takes this matter very seriously and is working diligently with both Swiss and U.S. government authorities.''
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Jagajeet Chiba, Gambling911.com
