Did Wikileaks Supporters Hack Visa & Mastercard Websites?

Even though the website Wikileaks first appeared on the web back in December 2006, and even though the website itself has won a number of awards over the course of its existence, including the 2008 Economist Magazine New Media Award, it did not become a household name until about a month ago… when the leak of diplomatic cables became the topic of conversation around every water cooler.

Wikileaks was developed originally as a non-profit new media organization devoted to publishing classified documents and information from anonymous news sources and leaks.  Because of the non-profit status, the site relies on donations to support its internal operations.  The site uses a merchant account set up with Visa, MC and Paypal, these are the types of transactions they accept in order to accept donations from various supporters.

Paypal lead the charge on Friday, December 3rd, pulling their processing capabilities from the site and claiming on their blog their refusal to support “activities that encourage, promote, facilitate or instruct others to engage in illegal activity.”  MasterCard followed suit on Monday with an announcement indicating they have “rules [that] prohibit customers from directly or indirectly engaging in or facilitating any action that is illegal.”  And on Tuesday, Visa announced that they were pulling processing capabilities from the site until they had the opportunity to complete further investigations.

By severing their ties to the controversial site, these payment brands effectively left Wikileaks unable to process any form of donations from their supporters.  Paul Hale from UK based website, Thinq offered this tongue in cheek solution:  “you can send us an envelope stuffed with cash and we’ll wander down the road and stick it through the bars of Mr Assange’s cell.”

In retaliation, on Wednesday, December 8, both Visa and MasterCard’s websites were brought down by what is believed to be a group of supporters of Wikileaks.  The cyber attack was dubbed Operation Payback, apparently the idea of a group on Twitter aptly named Anonymous.  On the same day, they took credit for the attack by tweeting  “IT’S DOWN! KEEP FIRING!!! #DDOS #PAYBACK #WIKILEAKS.”

The sabotage itself was quite simple in nature: a series of attacks in which computers across the internet are harnessed together to jam target sites with a large number concurrent requests for data, effectively overloading the networks and shutting them down.

While both MasterCard and Visa have confirmed that the cyber attack did not compromise any of their credit card transactions, it is not surprising that an attack of this nature would concern many cardholders during the busy holiday season.

It is no doubt that both Visa and MasterCard would have experienced some political pressure to make such a drastic decision. With many politicians now dubbing Assange as a ‘terrorist’, the optics of such a critical situation become more important than the reality.  It is also important to not dismiss the pressure the two payment brands may have experienced from their financial institution partners given that Assange has promised that the next leak will be on a major US Bank in early 2011.

Pressure or not, it is questionable on whether MasterCard and Visa made the right decision in shutting this merchant account.  While definitely not the first time these card brands have shut down a merchant account, the reason are quite subjective this time around.  Historically, merchant accounts can be shut down due to a high chargeback ratios or suspected fraudulent use for laundering money.  However, Wikileaks is a non profit media company.  Despite the website’s content, is it not another media outlet?  And should private organizations like Visa and MasterCard be given the ability to shut down accounts without admission of guilt let alone reasonable doubt?

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Matthew Hunt has been helping small businesses get set-up with Canadian Merchant Account Services since 2007 and helped 1000's do so. Join Matthew on Google+.

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