Last year we warned PayPal (PYPL) was a target in three regulatory probes. First, the Securities and Exchange Commission (SEC) is looking into the company’s interchange fees related to its debit card product. Second, the Consumer Financial Protection Bureau (CFPB) is investigating the company’s marketing and use of PayPal Credit in connection with certain merchants that provide educational services. Third, the CFPB is also looking into the unauthorized transfer of funds and collections processes related to Venmo, the company’s mobile money transfer product.

PayPal now finds itself in the Federal Trade Commission’s (FTC) crosshairs.

The Commission sent PayPal a civil investigative demand (CID) in February 2022 in connection with the company’s practices related to commercial customers that submit charges on behalf of other merchants or sellers as well as other activities. In 2018, PayPal settled FTC charges alleging it misled customers regarding the transfer of funds.

Expect PayPal’s operations to become more complex with the potential to attract additional regulatory scrutiny going forward. The company recently began providing insurance-like protection for cryptocurrencies held in PayPal accounts in case of loss directly resulting from service provider insolvency or in the event a service provider’s private keys are compromised.

PayPal is in the midst of a significant reduction in headcount. The associated restructuring charges resulted in a $20 million charge in the first quarter with an additional $100 million in charges to be taken throughout the rest of 2022. The company expects the initiative to save an estimated $260 million a year in employee-related costs, $90 million of which is stock based compensation (SBC).