Lawmakers in Wisconsin have introduced a new bill in the state Senate to complement an earlier proposal in the state Assembly aimed at cracking down on fraud involving crypto ATMs.
Senator Kelda Roys, together with six other Democratic senators, filed Senate Bill 386 on Monday as companion legislation to Assembly Bill 384, which Democratic Representative Ryan Spaude introduced on July 31.
Both bills propose that operators of crypto ATMs or kiosks must obtain a money transmitter license to operate in the state. They would also be required to collect key information from users, including their name, date of birth, phone number, address, and email.
Introducing identical bills in both chambers is a common legislative strategy designed to increase the chances of passage and accelerate the process, allowing both the Senate and Assembly to consider the legislation simultaneously.
Wisconsin Moves to Alert Crypto ATM Users
The proposed bills would require crypto ATM operators to collect a government-issued ID, such as a passport or driver’s license, and take a photo of each customer.
Operators would need to verify the customer’s identity for every transaction, and daily transactions would be limited to $1,000.
Additionally, the bills call for fraud warning labels to be displayed prominently “within the customer’s field of vision” on the front of the machine.
Crypto ATMs usually charge significantly higher fees than online crypto exchanges. The proposed bills would cap these fees at either a flat $5 or 3% of the transaction amount, whichever is greater.
Operators would also be required to fully refund customers if an ATM is used for a fraudulent transaction—such as sending funds to a scammer—or if law enforcement confirms within 30 days that the transaction was fraudulent.
FinCEN Issues Warning About Crypto ATM Scams
On August 4, the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) issued a notice urging financial institutions to report suspicious transactions carried out through crypto ATMs.
“Criminals are relentless in their efforts to steal money from victims, and they’ve learned to exploit innovative technologies like CVC [convertible virtual currency] kiosks,” said FinCEN Director Andrea Gacki.
FinCEN highlighted fraud, cybercrime, and drug trafficking as the primary illicit activities conducted via crypto ATMs. The agency also noted that elderly individuals are particularly vulnerable to scams in which fraudsters impersonate bank employees, tech support agents, or customer service representatives.
Worldwide Crackdown Targets Crypto ATMs
Crypto ATMs are increasingly under scrutiny worldwide due to concerns over their potential use in criminal activity.
On July 17, New Zealand banned all crypto ATMs, citing risks of money laundering and criminal financing.
In the UK, authorities seized seven crypto ATMs and arrested two individuals in southwest London in July for suspected money laundering and illegally operating a crypto exchange.
Meanwhile, Grosse Pointe Farms, a small town near Detroit, Michigan, proactively passed regulations on crypto ATMs despite not having any in the town.
