The Maine Bureau of Consumer Credit Protection recently announced a settlement with the cryptocurrency company Bitcoin Depot related to Maine residents who had used Bitcoin Depot’s Bitcoin ATMs to transfer money to scammers.  Under the terms of the settlement, Bitcoin Depot will pay Maine regulators $1.9 million to be returned to victims of the scams.

A report from the Federal Trade Commission (FTC) indicates a 1,000 % increase in money lost to scammers through cryptocurrency ATMs in the last three years.    Cryptocurrency ATMs look just like traditional ATMs, but instead of distributing cash, they take cash in exchange for cryptocurrency and enable the transfer of the deposited cash turned into cryptocurrency into crypto wallets.  Due to the anonymity and immediacy of the cryptocurrency transfers done through a cryptocurrency ATM, it is a favorite method of payment for scammers.

Most of the scams using cryptocurrency ATMs involve imposter scams where the scammer poses as either a law enforcement officer, government official or someone providing tech support for a non-existent problem.  What many of these imposter scams have in common is that they scare the targeted victim with a story about an emergency that requires them to take cash from their bank account and use a QR code provided by the scammer to deposit the money into the account of the scammer at a cryptocurrency ATM under the guise of protecting the funds.  In other versions of the scams, victims are told they must make a payment through a cryptocurrency ATM to avoid prosecution for missing jury duty or some other pretense.

TIPS

Protecting yourself from these imposter scams that form the basis of cryptocurrency ATM scams starts with recognizing that you can never be sure who is actually contacting you when you are contacted by phone, email or text message so you should never click on a link, download an attachment or provide personal information in response to any of those communications unless you have absolutely confirmed that the communication was legitimate.  Further there is no circumstance where you will be asked by anyone legitimate to withdraw funds from your bank, deposit them into a cryptocurrency ATM and transfer the funds to them.  Only scammers make those requests.

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