Arizona Enacts New Law to Protect Consumers from Cryptocurrency ATM Scams
Arizona’s new Cryptocurrency Kiosk License Fraud Prevention law (HB 2387) officially took effect on September 26, 2025, bringing important regulatory safeguards against crypto ATM scams that have increasingly targeted residents, especially seniors.
Background and Need for the Law
The rise in cryptocurrency ATM fraud in Arizona has reached alarming levels over the past year, with scammers employing deceitful tactics to defraud users of these machines. Cryptocurrency kiosks allow users to convert cash into digital assets like Bitcoin, but the lack of previous regulation left consumers vulnerable to fraud schemes.
Common scams involve perpetrators impersonating trusted figures—government officials, FBI agents, romantic partners, or job recruiters—who instruct victims to convert their cash into cryptocurrency through these ATMs and transfer it to the criminals’ digital wallets. Such transactions are often irreversible, making recovery difficult.
Attorney General Kris Mayes, recognizing the severity of the issue, issued support last November to local law enforcement efforts aimed at combating these crimes, highlighting the devastating financial impact on Arizona residents, particularly elderly individuals who have lost millions.
Key Provisions of the New Law
The law specifically targets fraud prevention and consumer protection by instituting the following mandates:
- Transaction limits: New users are capped at $2,000 daily, while existing users can transact up to $10,500 daily.
- Refund protections: New customers who fall victim to fraud and report the incident to law enforcement or the Attorney General within 30 days can apply for refunds from the crypto ATM operator.
- Consumer education: Efforts by the Arizona Corporation Commission and AARP Arizona focus on investor education and raising awareness about crypto ATM fraud risks.
Rachel Walden, Commissioner of the Arizona Corporation Commission, emphasized the commission’s commitment to investor education and fraud prevention.
Wendy Coy, Assistant Director of the ACC Securities Division, stated, “This is a beneficial piece of consumer protection legislation, and I’d like to highlight the opportunity for fraud victims to apply for a refund from the crypto ATM operator if they are new customers and report the fraudulent transaction to law enforcement or the Attorney General within 30-days.”
Significance for Seniors and Broader Public
Data shows that older adults are disproportionately affected by these scams. People over 60 are more than three times as likely to report losses from crypto ATM fraud, accounting for the majority of reported dollar losses. Seniors are often targeted through impersonation scams, resulting in severe financial harm.
AARP Arizona played a crucial role in advocating for this law, motivated by the heartbreaking stories of elders losing their life savings to fraudsters.
Implementation and Enforcement
The Arizona Corporation Commission’s Securities Division is tasked with enforcing the new law and providing resources for reporting and education. Businesses operating cryptocurrency kiosks must comply with licensing requirements and consumer protection mandates to legally operate in the state.
The law strengthens Arizona’s position as a leader in consumer protection amidst the growing challenges posed by rapidly evolving financial technologies such as cryptocurrency.
Conclusion
Arizona’s Cryptocurrency Kiosk License Fraud Prevention law marks a significant step toward safeguarding consumers, particularly vulnerable seniors, from sophisticated crypto ATM scams. By setting transaction limits and enabling fraud victims to seek refunds, it offers practical tools to reduce the financial harm caused by these crimes.
Residents are encouraged to stay informed about the risks, report suspicious activity promptly, and leverage available protections to guard their assets in the expanding digital currency landscape.