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Iowa Attorney General Brenna Bird has filed a lawsuit against Iowa’s two largest cryptocurrency ATM operators that have cost Iowans more than $20 million, her office says.
Bitcoin Depot and CoinFlip, Iowa’s two largest cryptocurrency ATM operators, were subject to a “first-of-its-kind investigation” in October 2023 for failure to protect users against scammers who were able to have millions transferred to them through cryptocurrency kiosks, a release from the attorney general’s office says.
Bird’s office subpoenaed 14 crypto ATM companies for a list of Iowans who had sent their money through the companies’ ATMs. The office interviewed those Iowans and investigated complaints, police reports and self-reported scams, according to the release.
The investigation found hundreds of Iowans, mostly over the age of 60, had sent approximately $20,426,616 through Bitcoin Depot and CoinFlip ATMs in a less than 3-year period.
In all, $13,182,625 was sent through CoinFlip ATMs and $7,234,991 through Bitcoin Depot, the attorney general’s release said.
“Con artists are evil and will stop at nothing to steal everything you have,” Bird said in the news release. “We already know that they target older Iowans, but now it seems that they even hunt through obituaries to target widows. They convince these older women that they need help, and then send their victims to crypto ATMs. And the crypto ATM companies take a cut of the profits. It’s not just wrong, it’s illegal.
The investigation also “exposed how cryptocurrency ATMs profit off of Iowans getting scammed,” the release said.
Bitcoin Depot takes 23% of the money Iowans send through machines, while CoinFlip takes 21%, according to the release.
Bird is suing both companies for violating the Iowa Consumer Fraud Act. The suit alleges both companies profit off of scam victims through these transaction fees and that they deceive Iowans about their refund policies.
“I’m fighting to get Iowans their money back and force the crypto ATM companies to make big changes,” Bird said in the release. “No Iowan should get ripped off like this.”
The investigation into crypto ATM companies is ongoing, according to the release.
If you or someone you know has been a target of a cryptocurrency ATM scam, reach out to the Iowa Attorney General’s Office at 1-888-777-4590 or file a complaint online.
Kyle Werner is a reporter for the Register. Reach him at kwerner@dmreg.com.