This is the first Enforcement Action Taken Under the Landmark Digital Financial Assets Law
SACRAMENTO – The California Department of Financial Protection and Innovation (DFPI) announced today that it has entered into a consent order with Seattle-based Coinme, Inc. (Coinme), a crypto kiosk operator, for non-compliance with the state’s Digital Financial Assets Law (DFAL).
Coinme operates in crypto kiosks across California, typically located in grocery and convenience stores, where users can exchange cash or other forms of payment for digital assets. The DFPI investigation revealed that Coinme violated DFAL’s transaction limit prohibiting crypto kiosks from accepting or dispensing to a customer more than $1,000 in a day. Additionally, Coinme failed to include certain required disclosures on customer receipts, as mandated by the law.
Under the consent order, Coinme has agreed to pay a $300,000 penalty, including $51,700 in restitution to an elderly California resident, and implement measures to address and prevent future violations. The consent order is the first enforcement action taken under the DFAL.
“This enforcement action should send a strong message to kiosk operators that California means business when it requires digital asset companies to follow the rules that help prevent scammers from taking advantage of unsuspecting Californians,” said KC Mohseni, DFPI Commissioner.
Crypto Kiosk Scam
Scammers are increasingly exploiting crypto kiosks (commonly called crypto ATMs) to defraud individuals, particularly older adults. Consumers are tricked into purchasing digital assets and transferring them directly into the scammers’ crypto wallets. To mitigate such risks, the DFAL was enacted in 2023, imposing regulations on kiosk operators. Learn more about crypto kiosk scams.
Report Scams to DFPI
If you have been a victim of a scam or fraud, or you learn about a scam that is currently not listed on the Crypto Scam Tracker, let us know immediately by filing a complaint with the DFPI online (dfpi.ca.gov/submit-a-complaint) or calling toll-free at (866) 275-2677.
About DFPI
The Department of Financial Protection and Innovation protects consumers, regulates financial services, and fosters responsible innovation. DFPI protects consumers by establishing and enforcing financial regulations that promote transparency and accountability. We empower all Californians to access a fair and equitable financial marketplace through education and preventing potential risks, fraud, and abuse. Learn more at dfpi.ca.gov.