A group of U.S. Senate Democrats, led by Majority Whip and Senate Judiciary Committee Chair Dick Durbin, recently urged major cryptocurrency ATM operators to address the rising fraud targeting elderly Americans. Data from the Federal Trade Commission (FTC) revealed that fraud linked to Bitcoin ATMs (BTMs) reached $65 million in the first half of 2023. Specifically, individuals aged 60 and over are more than three times as likely to fall victim to BTM-related scams than younger adults, prompting the senators, including Elizabeth Warren, to call on 10 of the country’s largest crypto ATM firms to take immediate action.
The letters were addressed to CEOs and top executives of Bitcoin Depot, CoinFlip, RockItCoin, Bitstop, Coinhub, Unbank, Athena Bitcoin, Byte Federal, Cash2Bitcoin, and Margo. The senators highlighted the role these companies play in placing BTMs in various locations and the impact it has had on elderly Americans. They expressed concern over scams involving elderly individuals, citing cases where businesses removed BTMs after realizing most users were victims of scams. The senators requested a response from the companies by October 4 on the measures being taken to prevent fraud, including providing scam warnings, imposing transaction and deposit limits, and offering fraud insurance for depositors.
The FTC reported that crypto ATM fraud has surged tenfold since 2020, increasing from $12 million to $144 million. Additionally, the FBI noted a 45% increase in losses to crypto fraud in 2023, reaching $5.6 billion. Scammers are increasingly incorporating crypto ATMs into their fraudulent schemes, exploiting these digital currency exchange points to swindle unsuspecting victims. The surge in crypto ATM fraud coincides with the growing popularity of these machines, with the number of crypto ATMs in Australia increasing from 73 to nearly 1,200 in just two years, and the United States boasting approximately 32,000 machines with Canada following with about 3,000.
Durbin, Warren, and other senators expressed particular concern for the elderly population, highlighting the vulnerability of individuals aged 60 and over to BTM-related scams. They emphasized the need for immediate action by crypto ATM operators to curb fraudulent schemes that disproportionately affect seniors. The letters sent to the companies requested information on what steps are being taken to prevent fraud, including the provision of scam warnings, transaction and deposit limits, and fraud insurance for depositors. The senators referenced reports of scammers coercing older adults into transferring funds through crypto ATMs and called on the firms to respond with their strategies by early October.
The surge in crypto ATM fraud highlights the need for increased vigilance and security measures in the digital currency space. As scammers continue to exploit the convenience and accessibility of crypto ATMs, particularly targeting vulnerable populations like the elderly, regulatory bodies and industry stakeholders must collaborate to enhance consumer protection measures. The significant increase in losses to crypto fraud in recent years underscores the urgency of addressing these issues and implementing robust safeguards to safeguard users from falling victim to fraudulent schemes. The response from crypto ATM operators to the senators’ calls for action will be crucial in shaping the future of security and trust in the crypto ATM sector.
