Growing numbers of people are victims of bitcoin ATM frauds, which is why U.S. Senator Dick Durbin is suggesting new rules meant to protect consumers. The Crypto ATM Fraud Prevention Act seeks stricter regulations on these devices to prevent financial exploitation.
Durbin brought up a story on the Senate floor whereby a fraudster persuaded a man to put $15,000 into a crypto ATM under false pretenses—that he may avoid arrest by paying a fine. The senator called this part of a worrying trend, especially harming elderly people and unskilled crypto users.
Stronger fraud prevention policies would be mandated of crypto ATM operators under the suggested law. For new users, these include showing daily and total transaction limits, confirming high-value transactions, and warning of scams. First-time users would specifically be limited to making $10,000 over two weeks and no more than $2,000 daily. Any transaction more than $500 would also ask for direct user confirmation over a phone call.
The law also seeks to give victims access and requires complete reimbursements in specific circumstances should fraud be discovered within 30 days. Enhanced tracking technologies would provide law enforcement with means to assist in the fight against fraud.
With losses of billions of dollars, crypto ATM fraud has exploded recently. Targeting older people, scammers use threats and dishonesty to drive them into financial transfers. These programs sometimes mimic conventional gift card frauds, tricking victims into making payments under false pretenses, according to reports.
Legislators are growing more worried about the absence of laws controlling over 30,000 cryptocurrency ATMs running all throughout the United States. Many states have already suggested their policies to fight crypto ATM fraud, so federal intervention is under discussion to establish a consistent level of security.
The passage of the law is still under question since political differences in Congress can affect its advancement. Supporters counter that putting these protections into place is necessary to defend customers and stop more financial losses to frauds.
Legislators place top importance on a safe transaction environment as crypto use increases. If passed, this law could significantly contribute to reducing fraud rates and fostering trust in bitcoin exchanges.
