Crypto ATM Scams: Don’t Let Fraudsters Drain Your Wallet
Scammers are increasingly exploiting digital assets kiosks (commonly called crypto ATMs) to defraud individuals, particularly older adults.
These machines, commonly found in convenience stores and gas stations, allow users to purchase digital assets using cash or debit cards. However, scammers manipulate victims into using these ATMs to transfer funds directly into the scammers’ crypto wallets.
How the Scam Operates
- Initial Contact: Scammers typically reach out via unsolicited phone calls, texts, or emails, pretending to be from a legitimate organization, a romantic interest, or a distant relative.
- Creating Urgency: They create a sense of urgency by inventing emergencies—such as a frozen bank account or a family member in trouble—and claim immediate action is required.
- Directing to a crypto ATM: The scammer instructs the victim to go to a specific crypto ATM and deposit funds. They often stay on the phone during the transaction, guiding the victim step-by-step. These ATMs usually display warnings about scams and note that transactions are non-reversible. Note: Under the state’s Digital Financial Assets Law (DFAL), kiosk operators are prohibited from accepting more than $1,000 per person, per day. If a kiosk accepts more than that, its operator is in violation of the law.
- Using QR Codes: Scammers may send a QR code to the consumer which, when scanned at the crypto ATM, directs the purchased digital assets straight into the scammer’s wallet.
Payments through these crypto ATMs or kiosks are quick and immediate. Transactions cannot be reversed and are often untraceable.
Warning Signs to Watch For
- Unsolicited messages claiming urgent problems with your accounts or an emergency involving a family member.
- Requests to withdraw large amounts of cash and deposit the funds into a crypto ATM.
- False assurances that using a crypto ATM will “protect” or “secure” your money.
Protect Yourself
- Verify: Always confirm claims by contacting the organization or individual directly using official contact information.
- Pause: Scammers rely on urgency. Take a moment to assess the situation and talk to someone you trust.
- Report: Suspect a scam? Report it to the DFPI.
- Educate: Stay informed with our regularly updated Crypto Scam Tracker, and share what you learn—especially with older adults, who are frequently targeted.
No legitimate organization will ever ask you to deposit cash into a crypto ATM to resolve an issue or protect your money.
If someone makes this request, it’s a scam. Stay vigilant, ask questions, and always seek a second opinion before acting. For more crypto-related information and resources, visit dfpi.ca.gov/consumers/crypto/.