Increasing Fraud Risks Associated with Crypto ATMs

The rise of crypto ATM scams has led to significant financial losses, with fraudsters exploiting ATM users. The scams involve convincing victims their accounts are compromised, leading them to transfer money through the ATMs to the scammers. Authorities advise caution and suggest using established platforms for crypto transactions instead.

The use of Crypto ATMs is increasingly associated with fraudulent activities, resulting in significant financial losses, according to reports from the FBI and local police. These ATMs, commonly located in convenience stores, have become a favourite target for scammers and their owners, who exploit this technology for profit.

Typically, the scam involves a fraudster who deceives victims into believing their bank or social media accounts have been compromised. The perpetrator instructs the victim to withdraw funds and transfer them to a supposedly “safe” account, which is actually controlled by the scammer, utilising the crypto ATM for the transaction. Both the fraudster and the ATM owner benefit financially from this scheme.

Authorities, including Marc Dann, managing partner at Dann Law, have noted the frequency of such scams. He warns that any solicitation to deposit money into a crypto ATM likely indicates involvement with a criminal enterprise.

To safeguard against these scams, individuals are advised to refrain from transferring funds by purchasing cryptocurrency via ATMs. In the event of suspicious calls regarding account security, individuals should terminate the call and directly reach out to their bank for verification. For genuine cryptocurrency transactions, it is recommended to utilise established platforms, such as Coinbase, eliminating the need for the risky crypto ATMs.