AUSTRAC Limits Crypto ATM Transactions to $5,000 to Protect Elderly from Scams

Australia's anti-money laundering regulator, AUSTRAC, has implemented a series of measures targeting crypto ATM providers to combat scammers who exploit these devices to deceive the elderly. The regulator has set a $5,000 limit on cash deposits and withdrawals through crypto ATMs. Additionally, operators are required to enhance their customer due diligence obligations, include scam warnings, and monitor transactions closely. These actions follow data indicating that crypto ATMs are frequently used for fraudulent activities, with a significant number of victims being older individuals.

According to AUSTRAC, data from nine crypto ATM providers revealed that users over the age of 50 accounted for 72% of all transactions, with those aged 60 to 70 making up 29% of the transactions. This demographic is particularly vulnerable to scam activities, raising concerns about the exploitation of elderly individuals through crypto ATMs. AUSTRAC's CEO, Brendan Thomas, expressed alarm at the overrepresentation of this age group in crypto ATM transactions, highlighting the urgent need for protective measures.

Australia has seen a rapid increase in the number of crypto ATMs, with over 1,600 machines in operation, up from just 23 in 2019. These machines facilitate nearly 150,000 transactions annually, with approximately $275 million being transferred through them. The primary cryptocurrencies involved in these transactions are Bitcoin, Tether's USDT, and Ethereum. The regulator's actions include refusing to renew the registration of Harro’s Empires, a crypto ATM provider found to have exploitable vulnerabilities. AUSTRAC has also been actively warning providers to register with the agency and implement proper money laundering checks.

In response to the rising number of scams, AUSTRAC has taken decisive steps to protect vulnerable individuals. The agency has mandated enhanced customer due diligence measures and is collaborating with law enforcement to place educational materials near crypto ATMs. These efforts aim to deter potential victims before funds are sent through the machines. AUSTRAC's CEO, Brendan Thomas, emphasized that once money is transferred through these ATMs, it is nearly impossible for authorities to retrieve it, underscoring the importance of preventive measures.

AUSTRAC's regulatory actions are part of a broader global effort to combat money laundering, terrorism financing, and other illicit activities involving cryptocurrencies. The agency's move serves as a clear warning to the industry, emphasizing the necessity of compliance with regulations to protect citizens and reduce exposure to high-risk activities. As the threat of crypto fraud continues to rise, regulatory bodies worldwide are accelerating their efforts to implement stricter measures to safeguard consumers, particularly the elderly, from falling victim to scams.