CFTC Flags Crypto ATM Fraud After $388 Million Loss

Scammers pose as Internal Revenue Service agents, bank employees or tech-support representatives and use psychological pressure to create urgency, the CFTC said. The victim withdraws cash, finds a nearby machine and scans a QR code provided by the criminal. Fiat money is instantly converted into cryptocurrency and sent to an anonymous wallet, making a chargeback impossible.

Unlike the traditional banking system, where fund movement can be tracked and blocked, crypto ATMs send money in only one direction, the CFTC noted. The agency reiterated that no legitimate government body or bank will ever demand payment through a crypto ATM or via gift cards. "Any mention of these payment methods during a conversation is a direct sign that the person on the other end of the line is a criminal," the CFTC said.