PayPal funds academic research on illegal firearms transactions

NEW YORK (Reuters) - PayPal Holdings Inc PYPL.O is teaming up with criminologists and experts at several universities to probe the payment systems used in the trafficking of illegal firearms in the United States, the company said on Tuesday.

FILE PHOTO: The PayPal logo is seen at an office building in Berlin, Germany, March 5, 2019. REUTERS/Fabrizio Bensch

The research aims to help financial companies and law enforcement understand what types of payment methods are used to finance illegal transactions and prevent them from taking place, PayPal executives said.

The effort will be led by the Center on Crime and Community Resilience at Northeastern University and the University of Chicago Crime Lab.

The hope is that having a better understanding of illegal gun trafficking will help eradicate gun-related violence, said Dave Szuchman, PayPal’s head of global financial crime and customer protection.

“There haven’t been comprehensive studies done,” he said in an interview.

The San Jose, California-based company bans customers from using its services - including popular peer-to-peer payments app Venmo - to buy or sell firearms.

The research initiative comes as other large companies, including Citigroup Inc C.N and Walmart Inc WMT.N, have tried to address gun safety through financing or sales following numerous mass shootings across the United States in recent years.

The research will be led by Dr. Anthony Braga, director of the School of Criminology and Criminal Justice at Northeastern and an expert on the subject of gun violence and reducing illegal access to firearms.

Braga and his team are joined by experts from the University of Chicago Crime Lab, the Violence Prevention Research Program at the University of California, Davis, led by Garen J. Wintemute, a professor of emergency medicine, and Philip J. Cook, a professor of public policy at Duke University and co-director of the NBER Working Group on the Economics of Crime.

Among other things, the research will examine prices paid for illegally acquired guns, how the transactions were financed and how internet sales on the surface, deep and dark web facilitate illicit sales. The research will also examine international gun trafficking organizations, Braga said.

“We hope to establish a new area of study that could have major policy implications - how illegally sourced guns are financed,” Braga said. “This is a subject where researchers and policymakers understand very little.”

Reporting by Anna Irrera; Editing by Dan Grebler