Cryptocurrency ATMs (crypto ATMs) are frequently used in financial crimes, including scams, money laundering, and fraud. This guide is a quick reference for law enforcement officers with key investigative steps, evidence collection techniques, and strategies for working with crypto ATM operators.
1. Understanding How Crypto ATMs Work
Crypto ATMs allow users to buy or sell cryptocurrency using cash or debit cards. Transactions typically involve scanning a wallet QR code, inserting cash, and receiving cryptocurrency in a digital wallet. Some ATMs allow cash withdrawals by sending crypto to the machine.
Types of Crypto ATMs:
One-Way ATMs: Only allow users to buy cryptocurrency.
Two-Way ATMs: Allow both buying and selling of cryptocurrency.
2. Common Crimes Involving Crypto ATMs
A. Fraud & Scams
Tech Support Scams: Victims are tricked into depositing money into a crypto ATM under the belief they are paying for virus removal or security upgrades.
Government & Law Enforcement Impersonation: Scammers pose as IRS, FBI, or police, demanding victims deposit cash into a crypto ATM to avoid arrest or penalties.
Romance Scams: Victims send money through a crypto ATM believing they are helping a romantic partner.
Investment Scams: Victims are convinced to “invest” through a crypto ATM, only to lose their funds.
B. Money Laundering
Criminals convert illicit cash into cryptocurrency through ATMs to make it more difficult to trace.
Some crypto ATM operators do not comply with Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations, allowing for anonymous transactions.
C. Drug Trade & Human Trafficking
Cryptocurrency ATMs are used by criminal networks to move funds quickly and evade law enforcement detection.
3. Investigative Steps
A. Initial Response
Interview the Victim: Gather information about how they were contacted, what they were told, and how much money they deposited.
Secure Evidence: Collect transaction receipts, bank withdrawal records, and any communications with the scammer (emails, texts, call logs).
Locate the Crypto ATM: Identify the machine used, take photographs, and note surveillance camera placements.
B. Identifying the ATM Operator
Check the ATM for operator contact information.
Use blockchain explorers to trace transactions and identify associated wallet addresses.
Contact the ATM operator to obtain transaction logs, customer verification data (if any), and video or Know Your customer (KYC) information they may have.
C. Gathering Transaction Data
Obtain a wallet address from receipts or victim records.
Use a blockchain explorer (e.g., Blockchain.com, or Etherscan.io) to track transactions.
Determine if the funds were sent to an exchange, mixer, or another identifiable address.
D. Legal Requests & Subpoenas
If the crypto ATM operator is legitimate and follows regulations, issue a subpoena for transaction logs, KYC data, and surveillance footage.
If the funds were sent to a cryptocurrency exchange, request account details from the exchange through a subpoena or warrant.
E. Surveillance & Tracking
Obtain video footage from the ATM location to identify suspects.
Check for multiple withdrawals or deposits at different locations, indicating a mule network.
Use financial analysis tools to determine whether the scammer is linked to other transactions.
4. Evidence Collection Checklist
✔️ Victim’s Statement (How they were contacted, scam details, transaction details) ✔️ Receipts from the crypto ATM transaction ✔️ Surveillance Footage from the ATM location ✔️ Phone Numbers, Emails, or Social Media Accounts used by the scammer ✔️ Wallet Address Used (Check blockchain explorers for transaction tracing) ✔️ Bank Withdrawal Records (If the victim withdrew cash before using the ATM) ✔️ Crypto ATM Operator Contact Information
5. Working with Crypto ATM Operators
Some crypto ATM operators comply with law enforcement and maintain KYC (Know Your Customer) records, including:
ID verification photos
Transaction logs
Contact information
Others operate anonymously or do not follow compliance regulations. If an ATM is frequently used for scams, check if the operator is violating state or federal financial laws.
Regulated vs. Unregulated Operators
Regulated Operators: Must register with FinCEN and comply with AML laws.
Unregulated Operators: May not collect customer information, making tracing transactions difficult.
Law enforcement can check if an operator is registered with FinCEN by searching the Money Services Business (MSB) registry.
6. Preventing Crypto ATM Scams
Educate the Public: Inform citizens that government agencies, law enforcement, and tech support will never demand payment via crypto ATMs.
Work with Local Businesses: Train store employees where crypto ATMs are located to recognize scam victims.
Encourage Reporting: Victims should report scams immediately to law enforcement and financial institutions.
7. Next Steps for Law Enforcement
🔹 Monitor Local Crypto ATMs: Identify high-risk locations with frequent scam reports. 🔹 Establish Contact with ATM Operators: Request compliance records and build investigative partnerships. 🔹 Use Blockchain Analysis Tools: Track transactions and connect cases. 🔹 Educate Officers: Provide training on identifying crypto-related scams and gathering blockchain evidence.
Need More Training?
The Cryptocurrency for the Patrol Officer Course covers crypto ATM investigations and is POST approved in Kansas & Missouri.
📩 Schedule a course for your agency: uscryptocop@gmail.com 🔗 More resources: www.uscryptocop.com 🐦 Follow for updates: @USCryptoCop
A Quick Guide to Investigating Cryptocurrency ATM-Related Crimes
