"DOJ Cracks Down on Crypto ATMs as Tool for Laundering Scam Funds"

The U.S. Department of Justice has filed a lawsuit against Athena Bitcoin, a company operating cryptocurrency ATMs, alleging that the firm facilitated fraudulent activity by allowing deposits from scams and scams-related transactions. The lawsuit, announced by the DOJ, highlights Athena Bitcoin’s role in processing payments linked to phishing schemes, romance scams, and other forms of fraud, with particular emphasis on the platform’s failure to implement adequate safeguards against such illicit activity.

According to the DOJ, Athena Bitcoin’s cryptocurrency ATMs were used to deposit more than $2.4 million in funds obtained through scams between 2021 and 2023. The company reportedly allowed users to convert fiat currency into Bitcoin without sufficient verification to ensure the funds were not proceeds of fraud. This practice, the DOJ argues, made Athena Bitcoin’s services a conduit for criminals seeking to launder illicit gains into digital assets.

The complaint also states that Athena Bitcoin’s systems failed to identify and block transactions flagged as suspicious by law enforcement or financial regulators. The DOJ has emphasized that the case is part of a broader effort to hold cryptocurrency operators accountable for their role in enabling financial crime, particularly as the sector continues to evolve with limited oversight and high transaction anonymity.

In response to the allegations, Athena Bitcoin has not publicly commented, and no legal motion has been filed as of the latest update. The company previously marketed its services to investors with promises of rapid returns through Bitcoin kiosks and automated trading platforms, but the lawsuit now shifts the narrative to one of regulatory scrutiny and legal liability.

The case adds to a growing list of enforcement actions taken by U.S. regulators against cryptocurrency businesses that fail to comply with anti-money laundering (AML) and know-your-customer (KYC) requirements. The DOJ’s action signals continued pressure on the industry to align with financial crime prevention standards, particularly as digital currencies become increasingly attractive to fraudsters and scammers due to their decentralized nature and the ease of cross-border transactions.