Crypto ATM Scams Spark Statewide Crackdown in Massachusetts

• Crypto ATM scams in Massachusetts surged, costing victims millions in unrecoverable losses.
• South Hadley officials propose a full ban to curb growing crypto-related fraud locally.
• State lawmakers advance bills to license operators and impose stricter consumer protections.

The scam of crypto ATMs is rapidly spreading in Massachusetts, which is a concern among the local and state authorities. Fraudsters using these machines have stolen thousands of dollars owned by victims since they are operated using minimal supervision. According to law enforcers, the frauds are almost immeasurable and irreversible, and hence people may not have a chance to recover their money. Consequently, South Hadley authorities are currently making a bold move, and legislators at Beacon Hill are debating new consumer protection policies.

Crypto ATM scams surge across Massachusetts

State officials are recording millions of dollars of losses that are related to cryptocurrency ATMs. In another case, a South Hadley business owner lost $11,000 after a scammer had posed as his boss. Therefore, one of the employees inserted the money in a crypto machine because he did not know about the fraud. Police Chief Jennifer Gundersen says that these are cases that are irreversible and untraceable, and they all take a lot of time to investigate.

Besides, Middlesex County Sheriff Peter Koutoujian informed legislators that the scams have become a national crisis. In 2024, the FBI obtained more than 11,000 complaints related to crypto kiosks, and the overall losses have reached $247 million. That is a 99% increase in the reported cases and 31% in the losses to the victims as compared to 2023. In the same manner, Northwestern Assistant District Attorney Nicholas Atallah reported that he regularly serves several departments every month and hardly manages to recover stolen money.

South Hadley pushes for townwide ban

The answer to the mounting crisis is the South Hadley police assisting a local ordinance to prohibit crypto ATMs. The plan, which follows the example of other cities such as Waltham and Gloucester, would allow the business owners to have 30 days to take the machines out or pay a fine of $300 a day. The plan already has the support of the Select Board and is in a vote that is to take place at the November 5 special Town Meeting.

There are only two companies operating such kiosks in South Hadley at the moment. Nevertheless, Gundersen remarked that it is critical that it should be done early to avoid rapid growth. In several months, Waltham increased four machines to 14, she warned. Additionally, she has observed that there are owners of these stores who could have willingly aided the people committing the fraud to make money off the shoddy dealings.

Meanwhile, legislators are working to introduce bills (H 1247 / S 707) that will force operators to license their money transmitters and to have every kiosk registered with the state. Moreover, the legislation aims to limit the daily transactions to $1,000, as well as add fraud warnings, print receipts, and live customer service. Glenn Kaplan with the Attorney General’s office stressed on the importance of prevention. Finally, with South Hadley advancing and its local ban, there is a growing pressure on Massachusetts to fight the spiral of crypto ATM rip-offs in the state.