Durbin Cracks Down On Crypto ATM Fraud

Durbin Cracks Down On Crypto ATM Fraud

PEORIA - U.S. Senate Democratic Whip Dick Durbin (D-IL) today joined Peoria Mayor Rita Ali and the AARP of Illinois to discuss crypto ATM fraud prevention in Peoria and Durbin's Crypto ATM Fraud Prevention Act, which seeks to crack down on cryptocurrency scams by strengthening protections around crypto ATM transactions and increasing transparency from crypto ATM operators.

"Crypto ATMs are found in almost every town in Illinois. You have probably seen one in your local gas station or grocery store," said Durbin. "Scammers use these machines to cheat hard-working Americans out of their savings because the transactions are virtually untraceable. My bill, the Crypto ATM Fraud Prevention Act, would establish protections for consumers and hold these scammers accountable so no more Americans lose their hard-earned money."

"As your mayor, my top priority is always keeping the community safe. Crypto ATMs can be found right here in Peoria, and despite continued efforts from our police, some seniors have gotten scammed. These scams have taken thousands of dollars in life savings from our neighbors, and there's no way to get that money back. I will continue to work alongside leaders like Senator Durbin to fight against these scams and keep and your money safe," said Peoria Mayor Rita Ali.

"The scale of crypto-related fraud we're seeing today is not just alarming - it represents one of the largest transfers of wealth from older Americans to criminals in history and AARP Illinois commends Senator Durbin for his attention to the crisis," said Courtney Hedderman, AARP Illinois Senior Associate Director for Advocacy and Outreach. "Cryptocurrency kiosks have become a powerful tool for scammers, and far too many victims are older adults who simply cannot recover from these devastating losses. We need bold, coordinated action focused on prevention, education, and accountability to protect people before their life savings are gone."

Often, crypto scammers will contact elderly Americans, and using threats, intimidation, and fabricated backstories, coerce them into depositing large sums of money into the criminals' crypto wallets via cryptocurrency ATMs. According to data released by the Federal Trade Commission (FTC), the amount consumers reported losing in this form of fraud increased nearly tenfold between 2020 and 2023-from $12 million to $114 million. The average amount that a scam victim lost in Illinois last year was nearly $40,000 dollars. In March, a Peoria County senior lost $71,000 through a crypto ATM scam. And last year, a New Lenox man lost $15,000 to a scammer who claimed he was wanted for missing jury duty.

Durbin's legislation remains the only standalone federal legislation to combat these scams. The Crypto ATM Fraud Prevention Act would prevent crypto ATM scams and help law enforcement combat fraud by requiring that crypto ATM operators:

• Provide clear warnings to consumers about common types of scams;
• Appoint a chief compliance officer;
• Develop a comprehensive anti-fraud policy
• Register and regularly update crypto ATM locations with the Financial Crimes Enforcement Network (FinCEN);
• Require crypto ATMs to print paper receipts that include information for law enforcement to trace transactions; and
• Provide special protections to new customers (those within 14 days of their first transaction) who are most vulnerable to scams, including:
• Daily transaction limits ($2,000/day and $10,000 total over the first 14 days);
• Full refunds when scams are reported within 30 days (existing customers may get fees refunded); and
• Requiring operators to verbally confirm that new customers wish to proceed with the transaction and are not being scammed.

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