The US Justice Department has asked PayPal, the online payment processing unit of Internet auctioneer eBay, to hand over some customer recor...

The US Justice Department has asked PayPal, the online payment processing unit of Internet auctioneer eBay, to hand over some customer records as part of a tax-evasion probe. The "John Doe" summons permits the Internal Revenue Service to obtain information about possible tax fraud by people whose identities are unknown and is part of an investigation of possible tax evasion by US taxpayers using credit cards issued by offshore banks. An estimated $40 billion dollars in federal tax revenue is lost every year because of the use of credit cards linked to accounts held in foreign tax havens, according to the Treasury Inspector General for Tax Administration. The US Government made similar requests of MasterCard International, Visa International and American Express in 2000 and 2001. "This is just fact-finding by the IRS. PayPal is one of the mechanisms by which money stashed overseas might be spent," said a spokeswoman. The summons requires PayPal to provide account and transaction records relating to US taxpayers with MasterCard, Visa and American Express cards issued by banks based in tax-haven countries covering the period 31 December 1999, through to 31 December 2004.