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Arizona AG Warns Residents: Crypto ATM Scams Are Surging

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Arizona Attorney General Kris Mayes issued a statewide scam alert on Monday, warning residents that crypto ATM fraud has change into a mounting menace after Arizonans misplaced over $177 million to those schemes in 2024.

Her workplace concurrently launched a new fraud complaint form, enabling victims to report losses inside 30 days of being scammed.

The warning comes as a broad crackdown on crypto kiosk fraud intensifies throughout the United States and past, with the FBI reporting a 99% surge in complaints and over $246 million in whole losses in 2024.

From lawsuits towards main operators to sweeping federal laws, the business is underneath hearth as lawmakers race to guard weak shoppers.

Arizona’s New Laws Target Crypto Kiosk Fraud

Scammers sometimes attain victims by means of unsolicited calls or texts, impersonating banks, legislation enforcement, or family members earlier than pressuring them to deposit money into considered one of Arizona’s roughly 600 crypto ATMs.

Once funds enter a kiosk, they’re almost unimaginable to get better. Scottsdale police alone have already reported $5 million in losses this yr.

“Fraudsters are more and more utilizing bitcoin ATMs to victimize Arizonans — scammers stole greater than $170 million from Arizonans final yr utilizing these crypto kiosks,” Mayes said, including that “If you’re being directed to make use of one, there’s a really very high probability you’re being scammed.“

The state has additionally partnered with Yavapai County Sheriff David Rhodes to position bodily “STOP” indicators on Bitcoin ATMs throughout the state.

Beyond warnings, Arizona’s Crypto Kiosk License Fraud Prevention law, efficient since September 2025, caps each day transactions at $2,000 for brand new prospects and $10,500 for present customers.

Operators should now subject full refunds to fraud victims who file a police report inside 30 days.

At that point, Governor Hobbs also signed HB 2749 to create a state Bitcoin reserve funded completely by unclaimed digital property

Lawsuits and Indictments Shake the Industry

While Arizona tightens shopper safeguards, authorized battles are escalating elsewhere towards a number of the sector’s greatest gamers.

Washington, D.C., Attorney General Brian Schwalb sued Athena Bitcoin after an investigation revealed that 93% of the corporate’s deposits throughout its first 5 months within the district had been immediately tied to scams, with a median sufferer age of 71, and that one resident misplaced $98,000 throughout 19 transactions.

The firm allegedly charged undisclosed charges of as much as 26% whereas implementing a strict no-refunds coverage on fraud victims.

“Athena is aware of that its machines are getting used primarily by scammers but chooses to look the opposite manner in order that it could proceed to pocket sizable hidden transaction charges,” Schwalb declared.

The Athena case is way from remoted. Federal prosecutors in Chicago separately indicted Firas Isa, CEO of Crypto Dispensers, on money-laundering conspiracy fees after his community allegedly processed $10 million in fraud and drug proceeds.

Manhattan DA Alvin Bragg joined the strain, urging New York lawmakers to criminalize unlicensed crypto operations and warning of a “$51 billion prison financial system,” declaring that “If you’re working a crypto enterprise, you ought to be licensed.“

States and Nations Race to Close Regulatory Gaps

These enforcement actions have spurred legislative responses at each stage of presidency.

Senator Dick Durbin’s Crypto ATM Fraud Prevention Act, launched as Bill S. 710, would mandate Treasury registration, fraud warnings, transaction caps, and sufferer refunds nationwide, whereas Wisconsin legislators have additionally introduced parallel payments focusing on the state’s 582 kiosks with $1,000 each day caps and strict identification checks.

International regulators are shifting in the identical route, with New Zealand imposing an outright ban on crypto ATMs underneath anti-money laundering reforms and Australian Home Affairs Minister Tony Burke declaring, “Be in little doubt, crypto ATMs are a high-risk product,” after AUSTRAC discovered 85% of high kiosk customers’ funds had been linked to scams.

Similarly, Spokane, Washington, additionally became the first U.S. city to ban the machines entirely after federal probes revealed widespread fraud.

Amid the tightening, business exercise will not be completely stalled. Washington state ordered Coinme to halt operations and repay $8 million after regulators discovered it had illegally transformed unredeemed buyer funds into company income, but Polygon is reportedly eyeing an acquisition of the firm for $100 to $125 million.

Bitcoin Bancorp additionally not too long ago announced plans to deploy 200 new ATMs throughout Texas, the place over 4,000 kiosks already function underneath one of many nation’s clearest regulatory frameworks.

The publish Arizona AG Warns Residents: Crypto ATM Scams Are Surging appeared first on Cryptonews.

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