The state of Missouri is taking significant action against Bitcoin ATMs as the Attorney General, Catherine Hanaway, has initiated an investigation into the operations of these cryptocurrency kiosks. This inquiry arises from reports suggesting that the machines are linked to various scams that have financially impacted residents across the state.
The focus of the investigation centers on the alleged deceptive fee structures associated with these Bitcoin ATMs and how they may facilitate fraudulent activities. The Attorney General”s Office has confirmed that five companies operating these kiosks have received Civil Investigative Demands (CIDs). The firms under scrutiny include CoinFlip, RockItCoin, Bitcoin Depot, Athena Bitcoin, and Byte Federal.
The CIDs require the companies to provide detailed information regarding their fee disclosures, transaction practices, and existing anti-fraud measures. The inquiry aims to assess whether any of these practices breach Missouri”s consumer protection laws.
Attorney General Hanaway has indicated that her office has encountered numerous reports where victims were coerced into making hurried payments via Bitcoin ATMs, often under the pretense of being contacted by impersonators posing as law enforcement or government officials. Residents who suspect they have fallen victim to such scams are being urged to report their experiences directly to the state authorities.
Funding Request to Strengthen Consumer Protection
This investigation coincides with Hanaway”s request for additional funding aimed at bolstering the state”s capacity to combat cryptocurrency-related fraud. In a budget proposal submitted in December, the Attorney General”s Office has asked for $901,782 to enhance its consumer protection division. The funding is intended to facilitate the hiring of five attorneys, four investigators, and two support staff members.
This request was made ahead of Governor Mike Kehoe”s forthcoming State of the State address, which is expected to outline broader budget priorities. The additional resources are intended to expedite investigations and enhance response times as the state grapples with an uptick in cryptocurrency scams.
Growing Financial Losses from Scams
Reports from law enforcement across Missouri have highlighted a disturbing trend of scams involving Bitcoin ATMs. For instance, the Kirkwood Police Department issued a warning in November regarding scammers who were instructing residents to withdraw cash for deposits into Bitcoin ATMs. One local resident reported a staggering loss of $26,000 in a single incident.
State officials have voiced their concerns regarding the rising prevalence of cryptocurrency scams. Missouri Secretary of State Denny Hoskins has identified these scams as a significant consumer issue, while Clay County authorities revealed that over 150 residents experienced more than $3 million in Bitcoin ATM-related losses over a two-year span.
On a national scale, the Federal Bureau of Investigation documented losses exceeding $5.8 billion attributed to cryptocurrency-related fraud in 2024, marking a considerable increase compared to previous years. Furthermore, the Federal Reserve Bank of Kansas City has noted that scammers frequently employ QR codes linked to personal wallets, complicating the recovery of stolen funds.
