FinCEN Warns of Crypto ATM Scams Linked to Organized Crime and Elder Fraud

Financial institutions in the United States have been issued a warning by the Financial Crimes Enforcement Network (FinCEN) regarding the increasing use of cryptocurrency ATMs in fraudulent schemes linked to organized crime and elder scams [1]. The notice, FIN-2025-NTC1, dated August 4, 2025, highlights the growing threat of criminal groups exploiting these kiosks to launder illicit funds, including proceeds from drug trafficking [2]. The alert underscores the need for financial institutions to enhance their monitoring and reporting of suspicious transactions involving these machines, as they are increasingly being used as a tool for money laundering [1].

According to FinCEN, criminal organizations such as the Jalisco Nueva Generación cartel have been identified as frequent users of crypto ATMs to move illicit proceeds [2]. These ATMs, often operated by non-compliant businesses, frequently lack the proper controls and policies to respond to law enforcement inquiries, further complicating investigations [1]. The anonymity and speed of transactions offered by these kiosks make them particularly attractive to fraudsters seeking to evade detection.

The vulnerability of elderly individuals to these scams has also been highlighted. Reports indicate that older users, who may be less familiar with the risks associated with digital assets, are being targeted through deceptive schemes that direct them to use crypto ATMs [3]. In one case, a resident lost $25,000 after being misled by a scam involving a Bitcoin ATM [4]. These incidents demonstrate how criminal actors are leveraging the accessibility of cryptocurrency infrastructure to exploit less experienced users.

The notice also references broader regulatory and legislative efforts to address the risks posed by crypto ATMs. In February 2025, U.S. Senator Dick Durbin introduced a bill proposing measures such as transaction limits and clearer consumer warnings [1]. Over the years, regulatory bodies have increasingly scrutinized these kiosks due to their potential role in facilitating scams and illicit activities [2].

The FBI’s Internet Crime Complaint Center has reported a surge in complaints involving cryptocurrency ATMs, reinforcing the urgency of the issue [3]. As digital assets become more integrated into financial systems, the need for stronger compliance frameworks and due diligence becomes more critical. Financial institutions are now expected to adapt their monitoring protocols to detect and mitigate the risks associated with these emerging threats.

FinCEN’s notice marks a pivotal development in the ongoing effort to safeguard the digital asset ecosystem. While the innovation of cryptocurrency technology offers convenience and financial inclusion, it also introduces vulnerabilities that can be exploited by bad actors. The call for enhanced vigilance and collaboration among institutions and regulators reflects the evolving nature of financial crime in the digital age [1].

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Source:

[1] FinCEN.gov, FinCEN Notice, FIN-2025-NTC1, August 4, 2025 (https://www.fincen.gov/sites/default/files/shared/FinCEN-Notice-CVCKIOSK.pdf)

[2] AML Intelligence, NEWS: New FinCEN notice warns of rising crypto ATM scams (https://www.amlintelligence.com/2025/08/news-new-fincen-notice-warns-of-rising-crypto-atm-scams/)

[3] CoinCentral, FinCEN Warns Financial Institutions About Rising Crypto ATM Crimes (https://coincentral.com/fincen-warns-financial-institutions-about-rising-crypto-atm-crimes/)

[4] Cybercrime, Today's Top Cryptocrime News Stories (https://cybersecurityventures.com/cryptocrime/)