A report from the Federal Trade Commission (FTC) indicates a 1,000 % increase in money lost to scammers through Bitcoin ATMs in the last three years with consumers reporting losses of more than $65 million in just the first six months of 2024. Bitcoin and other 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 Bitcoin into crypto wallets. Due to the anonymity and immediacy of the Bitcoin transfers done through a Bitcoin ATM, it is a favorite method of payment for scammers.
Most of the scams using Bitcoin 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 all 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 Bitcoin ATM under the guise of protecting the funds. According to the FTC, people over 60 years old were more than three times more likely to report losing money to a Bitcoin ATM scam with an average loss of $10,000.
Recently in Westlake , Ohio a convenience store clerk noticed an elderly woman depositing thousands of dollars in cash into a cryptocurrency ATM and called the police to come in and stop her. Eventually, the responding officer was able to convince her that she was being scammed, but not before she had deposited and lost $5,500. Typical of such scams, she was responding to a scammer posing as her bank’s fraud department who told her to deposit the money into the cryptocurrency ATM to protect it.
TIPS
Protecting yourself from these imposter 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 Bitcoin ATM and transfer the funds to them. Only scammers make those requests.
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