Alabama Cracks Down on Crypto ATM Scams with New Refund Protections

The state of Alabama has implemented new regulations to protect consumers from cryptocurrency kiosk scams. As of October 1, operators are now required to reimburse qualifying scam victims under House Bill 303, the Cryptocurrency Kiosk Fraud Prevention Act.

According to the Alabama Securities Commission, the amount a victim can recover depends on whether they are classified as a new or existing customer. New users who fall victim to scams will receive full transaction refunds plus fees, while existing customers will recover half of the transaction value plus all fees.

The commission also outlined strict limits and disclosure requirements for operators. New consumers are limited to $1,000 per calendar day and $10,000 per calendar month, with identity verification required for each payment. Operators must also provide live, U.S.-based, toll-free customer service at all times.

Violations can result in civil penalties, and the commission has warned that while these measures will limit financial losses, fraudsters will continue to try and steal money.