Indiana Lawmakers Target Crypto Kiosk ‘Scam-demic’ as Hoosiers Lose Millions

Indiana legislators are moving to clamp down on cryptocurrency kiosks after a surge in scams that has cost Hoosiers more than a million dollars at the machines alone, according to law enforcement testimony and advocacy groups.[2][4] The proposed changes come amid what one detective has branded a statewide “scam-demic” fueled by digital currencies and loosely regulated bitcoin ATMs.[2]

House Bill 1116 Aims to Rein In Crypto Kiosks

At the center of the legislative push is House Bill 1116, a measure that would impose new rules on cryptocurrency ATMs, often called crypto kiosks, located in gas stations, convenience stores and grocery stores across Indiana.[2][4] The machines enable customers to buy bitcoin and other digital assets with cash or debit cards, but investigators say they have increasingly become a favored tool for scammers.[2][3]

The bill, authored by Rep. Wendy McNamara, R-Evansville, would:

• Cap fees charged at crypto kiosks at 3 percent per transaction.[4]
• Limit individuals to purchasing or transferring no more than $1,000 in a 24-hour period and $10,000 in any 30-day period through the machines.[2][4]
• Require prominent on-machine fraud warnings describing common scam techniques and red flags.[2][4]

McNamara has framed the proposal as a consumer protection bill designed to bring crypto kiosks in line with other financial services, not a broadside against digital assets themselves.[2][4] “It will establish strong guardrails that are similar to other financial services and then protect our most vulnerable,” she told the House Financial Institutions Committee in a recent hearing.[2][4]

‘Scam-demic’ Drains Hoosier Bank Accounts

The legislative effort follows a marked jump in crypto kiosk-enabled fraud reported by Indiana police and federal authorities. In Evansville, the local police department’s Financial Crimes Unit identified its first crypto ATM fraud cases in 2022 and then watched them accelerate: 11 cases in 2023, 20 in 2024 and 22 in just the first seven months of 2025, according to Sgt. Nathan VanCleave.[1]

VanCleave testified that Evansville residents alone lost about $400,000 to scams involving crypto kiosks in 2025.[2] The average fraud-related transaction at those machines was nearly $12,000, he said, underscoring how quickly a single encounter with a scammer can wipe out a victim’s savings.[1]

Statewide, the losses tied to online fraud are far larger. In 2024, Indiana consumers reported losing $125.1 million to crypto kiosk, gift card and other internet crimes, according to FBI data cited by AARP Indiana.[1] Experts and advocates caution that such crimes are significantly underreported, meaning the true scale of the damage is likely much higher.[1]

Nationally, the FBI reports that consumers lost $246.7 million through crypto ATMs in 2024, a 31 percent increase from the previous year.[1] Among cases in which the victim’s age was known, Americans over 60 accounted for 86 percent of the reported losses.[1]

How the Scams Work

Scammers use a variety of stories to steer victims toward cryptocurrency kiosks, according to law enforcement officials and fraud experts.[1][2] Many schemes begin with an unsolicited phone call or text message. Criminals often impersonate government agencies, banks, technology companies or utility providers, warning of an urgent problem that requires immediate payment.[1][2]

“These scams often begin with a phone call or a text message where criminals frequently impersonate government officials or trusted businesses, create a false sense of urgency,” Ambre Marr, state legislative director for AARP Indiana, told lawmakers.[2] The victims are then given step-by-step instructions: withdraw large amounts of cash from their bank, travel to a nearby crypto ATM and deposit the money to purchase digital currency that is instantly transferred to a wallet controlled by the scammers.[2]

Other schemes involve fake investment opportunities, threats of arrest, bogus computer virus alerts or fraudsters posing as helpful strangers offering to “secure” a victim’s bank account.[1] Once cash is fed into a crypto kiosk and converted to cryptocurrency, it is extremely difficult — and often impossible — to recover, investigators say.[1][3]

Fraud specialists note that scammers increasingly favor crypto ATMs, gift cards and even gold because these payment methods are fast, largely irreversible and can be moved across borders with ease.[1] Crypto kiosks, which closely resemble traditional ATMs, add to the confusion by appearing to be part of the regulated banking system, especially when located inside familiar retailers.[1][3]

Older Hoosiers Among the Most Vulnerable

AARP and law enforcement officials warn that older adults are disproportionately targeted in crypto kiosk schemes.[1][2] Many victims are retirees who may be less familiar with digital currencies and may be more likely to trust callers claiming to represent government agencies or long-standing service providers.[1]

In Indiana and across the country, the largest share of losses from crypto ATM fraud is reported among Americans over 60.[1] VanCleave said scammers often keep elderly victims on the phone during the entire process, directing them to specific kiosks and telling them exactly what to press on the machine’s screen.[2] Some victims have emptied retirement accounts or home equity to comply with what they believe are official instructions.[1][2]

AARP Indiana is backing House Bill 1116 and has urged legislators to require bold, plain-language warnings on every crypto kiosk, explaining that government agencies never demand payment in cryptocurrency and that urgent commands to pay with bitcoin are a reliable sign of fraud.[1][2]

Industry Pushback Over Fee Caps and Limits

Crypto ATM operators and lobbyists have offered cautious support for additional consumer protections but are pushing back against key provisions of the Indiana bill, particularly the 3 percent fee cap and strict transaction limits.[2][4]

Industry representatives told lawmakers that while they agree fraud is a serious concern, they fear the proposed rules could effectively drive crypto kiosk businesses out of the state.[2][4] Michael Geiselhart, government relations manager for Bitcoin Depot, testified that the 3 percent cap is “not necessarily a regulation for us, it’s actually more of an eviction notice.”[4]

Operators argue that their current fee structures are necessary to cover compliance, cash handling, armored transport and network costs, and that severe limits on how much a person can buy in a day or month could deter legitimate users.[2][4] Some have suggested higher transaction thresholds or more flexible caps paired with mandatory identity verification and enhanced fraud monitoring.

Lawmakers, however, have signaled that they see firm dollar limits as a straightforward way to blunt the worst losses from scams, especially for older residents who may be pressured into repeated high-value transactions over a short period.[2][4]

Part of a Broader Regulatory Trend

Indiana’s move comes as policymakers nationwide are scrutinizing crypto kiosks and considering tighter controls. In Washington, D.C., federal lawmakers have introduced the Crypto ATM Fraud Prevention Act of 2025, a bill that would amend federal law to help prevent fraudulent transactions at virtual currency kiosks.[5] The measure, sponsored by Sen. Richard Durbin, D-Ill., and several co-sponsors, has been referred to the Senate Banking, Housing and Urban Affairs Committee.[5]

Outside the legislative arena, consumer advocates are also pressuring major retailers that host crypto ATMs to more aggressively police the machines and intervene when suspicious patterns emerge.[3] Investigations have found that some stores see customers defrauded at kiosk machines on an almost weekly basis, prompting lawsuits and regulatory inquiries in other states.[3]

In Indiana, VanCleave and other law enforcement officials say they welcome additional tools. VanCleave described the current environment as a “scam-demic,” warning that scams “are just exploding, and particularly they are on steroids because of cryptocurrency.”[2] He and AARP Indiana contend that without new safeguards, Hoosiers will continue to lose life savings in transactions that are nearly impossible to unwind.[1][2]

What Happens Next

House Bill 1116 is working its way through the committee process at the Statehouse. If it wins approval in both chambers and is signed by the governor, the law would take effect immediately, imposing fee caps, transaction limits and signage requirements on crypto kiosk operators across Indiana.[2][4]

Supporters say they hope the legislation will not only curb current scams but also signal to criminals that Indiana is no longer a soft target for cryptocurrency-based fraud. For now, consumer advocates are urging Hoosiers to treat any demand for payment via crypto ATM as a serious warning sign — and to hang up the phone rather than head for the kiosk.