A U.S. senator has introduced a bill targeting fraud in cryptocurrency ATMs.
In a speech before the Senate, Dick Durbin detailed a constituent’s experience with fraud as a prelude to proposing the Crypto ATM Fraud Prevention Act.
Illinois Senator Dick Durbin, a Democrat who once chaired the Senate Judiciary Committee, introduced the bill to prevent fraud at crypto ATMs in the U.S.
On February 25, Senator Durbin spoke before the Senate and described how a scammer tricked a constituent into believing the authorities had issued an arrest warrant.
The fraudster claimed the man could avoid jail time by paying a $15,000 fine through a crypto ATM transaction.
The Illinois Senator warned that this scam reflects an “alarming trend of crypto ATM fraud,“ which affects over 30,000 machines across the country.
To prevent scams—especially those targeting older adults—he introduced the Crypto ATM Fraud Prevention Act to establish “common sense guardrails.”
“This bill will require crypto ATM operators to warn consumers about scams and take reasonable steps to prevent fraud at their machines,” said Senator Durbin.
“It will also put in place measures to limit the amount that consumers lose when they do fall victim to scams, give law enforcement new tools to track down and fight back against criminals.”
Although this scam involves cryptocurrency, it follows a familiar pattern that criminals have used for years—calling victims, falsely claiming legal action against them, and pressuring them to buy gift cards and send the redemption codes.
The FBI reported that crypto fraud caused losses of more than $5 billion in 2023, with many schemes focusing on senior citizens.
Under the proposed law, Senator Durbin stated that first-time crypto ATM users would receive “special protection” for the following two weeks.
If Congress enacts the law, crypto ATM operators would set a $2,000 daily and $10,000 total deposit limit per customer. Operators would also require new users to verbally confirm any deposit exceeding $500.
In some cases, fraud victims would have the right to receive a complete refund from operators.
Last October, authorities in the UK took action against a person accused of managing 11 unlicensed cryptocurrency ATMs without the necessary approval from the Financial Conduct Authority (FCA).
This unauthorized operator is at risk of receiving a two-year sentence for lacking FCA authorization, up to ten years for document forgery, and as much as fourteen years for handling illicit funds generated from these ATMs.
After competing House and Senate proposals on stablecoin regulation, Senator Durbin’s bill became one of the earliest pieces of crypto legislation introduced in the 119th congressional session.
The Republican-controlled Congress makes the fate of Democrat-sponsored bills uncertain, leaving it unclear if any will reach President Donald Trump for approval.
The bill aligns with President Donald Trump’s plan to establish the United States as the crypto capital of the world. It seeks to prevent illicit operations and bad actors, ensuring the global hub of crypto maintains integrity.
