State Department: We did not ask PayPal to cut off WikiLeaks

The State Department denied a report today that it contacted the online money transfer service PayPal and asked them to cut ties with WikiLeaks and its founder, Julian Assange, who remains behind bars in the United Kingdom.

"It is not true," State Department spokesman P.J. Crowley told The Cable. "We have not been in touch with PayPal."

Osama Bedier, vice president at PayPal, told an audience Wednesday at Paris’ tech conference Le Web’10 that PayPal had shut down its business with WikiLeaks, which used the electronic money transfer service to collect donations, at the request of the State Department.

"The State Department told us these were illegal activities. It was straightforward. We first comply with regulations around the world making sure that we protect our brand," Bedier reportedly said..

Crowley said that PayPal made the decision based on a publicly available letter sent last week to Assange and his lawyer from State Department counselor Harold Koh, which called the disclosure of 250,000 diplomatic cables by WikiLeaks an "illegal dissemination" of classified documents and said the leaks "place at risk the lives of countless innocent individuals — from journalists to human rights activists and bloggers to soldiers to individuals providing information to further peace and security."

A reporter from the TechCrunch blog confirmed with Bedier after his speech that he was in fact working from the Koh letter that State had sent to WikiLeaks.

Crowley also responded to the remarks of Australian Foreign Minister Kevin Rudd, who seemed to alter his country’s position on Assange, who is an Australian citizen, "Mr. Assange is not himself responsible for the unauthorized release of 250,000 documents from the US diplomatic communications network," said Rudd Tuesday. "The Americans are responsible for that."

"He’s correct in that the primary responsibility for the leak existed within the United States government," Crowley said, being careful not to criticize Rudd and create yet one more diplomatic problem.

As for whether the United States will seek to prosecute Assange under the Espionage Act of 1917 or some other U.S. laws, Crowley said that decision would be made by the Justice Department and the Defense Department. But he was clear about the State Department’s position on the matter.

"Certainly, we believe that what Mr. Assange has done in the aftermath of that leak has put the interests of our country and others at risk, and put the lives of people who are reflected in these documents at risk," Crowley said. We haven’t changed our view."