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Alert on Scams Involving Cryptocurrency ATMs

The Office of Financial Regulation has issued a regulatory alert for Maryland banks and credit unions about scams involving cryptocurrency ATMs. Scammers deceive victims into using these ATMs to buy virtual currency, transferring the money to the scammer’s crypto wallet.

crypto ATM stock image

Common scams include pig butchering, romance, impersonation, computer antivirus, and email scams. Banks and credit unions are advised to watch for the following red flags:

  • A customer with no prior history of using or purchasing cryptocurrency suddenly attempts to exchange a significant amount of cash from their account for cryptocurrency.
  • A customer expresses interest in an investment opportunity involving cryptocurrency that they recently learned about from an unknown person that reached out to them online or through a text message.
  • A customer mentions that they were instructed by an unknown person who reached out to them to exchange cash for cryptocurrency at a cryptocurrency ATM and to deposit the cryptocurrency at a specific address.
  • A customer seems stressed or anxious about withdrawing funds in order to make a transaction involving cryptocurrency.
  • A customer unusually and prematurely liquidates their savings account(s) and then attempts to wire the liquidated funds or exchange the funds for cryptocurrency.
  • A customer takes out a Home Equity Loan (HELOC), or second mortgage and uses the proceeds to purchase cryptocurrency.
  • Inactive accounts suddenly show unusual and frequent cash withdrawals of large amounts that are subsequently wired or exchanged for cryptocurrency.
  • System monitoring shows that a customer’s account (including their online account) is frequently accessed by different IP addresses, device IDs, geographies, or names inconsistent with the customer’s typical logins.

Credit unions are advised to report suspicious activity to FinCEN through a Suspicious Activity Report (SAR).

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