NORTH CAROLINA
Recent findings from an ABC News investigation, conducted in partnership with ITEAM, have uncovered a troubling trend involving Bitcoin ATMs, which are prevalent in North Carolina and across the U.S. Many users are falling victim to various scams associated with these machines.
In the Triangle area, reports indicate that consumers are losing significant sums—thousands of dollars—due to fraudulent activities centering around these kiosks.
The FBI projects that Bitcoin ATM scams could lead to losses of nearly $250 million for Americans in 2024—an alarming increase compared to the previous year. AARP is now alerting its 38 million members about how these ATMs have become prime targets for scammers preying on unsuspecting individuals.
One local victim, Pamela Mangum from Durham, shared her experience of losing over $70,000 in a Bitcoin ATM scam. She disclosed that she had never encountered a Bitcoin ATM before and was introduced to it by someone who posed as an “investment coach.”
“You have to put cash into that machine,” she explained. “She guided me on how much to deposit to supposedly progress and make more money.”
Mangum went through multiple transactions, investing thousands until she realized that she had been scammed. “I’m a smart person, but I got emotional and thought it was an easy path to profit,” she told a troubleshooter. “It’s a bitter pill to swallow knowing I’ve lost this money.”
Unfortunately, she’s not alone. The rise in Bitcoin ATM fraud has been alarming. According to Amy Nofziger from AARP’s Fraud Monitoring Network, victims reach out to her office daily to report scams. “It’s a serious issue. There are about 45,000 crypto ATMs nationwide,” she said. “Criminals are always inventing new methods to rob us, and this is the latest tactic.”
Adam Zarazinski, CEO of a crypto forensics firm, highlighted how scammers lure victims into using these machines. “People deposit cash into a Bitcoin ATM and unknowingly send that value in Bitcoin or other cryptocurrencies to a scammer’s wallet,” he explained. Typically, this involves scanning a QR code linked to the scammer’s wallet, allowing the ATM to transfer money directly.
Zarazinski noted that while scammers profit, operators of these machines also enjoy significant gains, generally earning 5 to 25 percent on each transaction. “They often turn a blind eye to the scams,” he said. “These operations are often backed by transnational criminal organizations, resulting in billions stolen from Americans and laundered overseas.”
In response to the growing crisis, Attorney General Jeff Jackson and Secretary of State Elaine Marshall, along with other government agencies in North Carolina, initiated a campaign this summer to address virtual currency and Bitcoin ATM scams. AARP has also advocated for enhanced consumer protections, including daily trading limits. “We want these ATMs to implement the same safeguards as traditional financial tools,” Nofziger noted, suggesting a cap on new customers’ daily transactions.
Once cash is put into a Bitcoin ATM, recovering that money can be immensely challenging.
A recent case involved another woman from Durham who lost nearly $24,000 after being duped by a scammer claiming her account was compromised.
To help protect yourself against such scams, consider the following tips:
- Be cautious of unsolicited calls or messages that suggest fraud or legal issues.
- Don’t feel rushed. Scammers often use urgency as a tactic to manipulate you.
- Consult someone you trust before parting with your money.
- If something seems off, reach out to law enforcement.
Related items: Woman loses $17,500 in cash to a fraud suspect who appeared at her home in North Carolina.
