Officials in Hawaii are alerting residents to a surge in scams involving cryptocurrency ATMs, which have led to significant financial losses, particularly among seniors. In 2024, the state recorded 68 complaints resulting in over $922,000 in losses, with numbers nearly doubling from the previous year. Authorities emphasize vigilance during the holiday season to prevent further victimization.
Cryptocurrency ATMs, which allow users to convert cash into digital currencies like Bitcoin, have proliferated across Hawaii, with a recent count identifying about 250 machines statewide. These kiosks, operated by firms such as CoinFlip, Bitcoin Depot, and Athena Bitcoin, are typically found in retail locations that receive rental fees for hosting them. However, this growth has coincided with an increase in fraud, described by AARP Hawaii state director Kealii Lopez as "an epidemic" during a December 3 briefing by the state House Committee on Consumer Protection and Commerce.
In 2024, complaints about scams at these virtual currency kiosks reached 68 across the state, including 19 on Hawaii Island, leading to $922,022 in reported losses. Lopez noted that under-reporting likely means the true figure is higher, as victims often hesitate to come forward. "The number of complaints have almost doubled in a year," she told lawmakers. "So, imagine what happens if we don’t do anything."
Scammers frequently pose as bank representatives, contacting victims—often elderly individuals—claiming their accounts are compromised. They instruct targets to deposit cash into a nearby crypto ATM for "safety," guiding them via phone throughout the process. Hawaii Police Department Capt. Rio Amon-Wilkins reported that such fraud predominantly affects seniors. In one Hilo grocery store incident earlier this year, a victim had inserted over $1,000 and was set to add more when a family member alerted officers, enabling police to recover the funds by seizing the machine.
Tracking perpetrators proves challenging, as Amon-Wilkins explained: "It’s oftentimes quite difficult for us to track down the offenders, because many of them are out of the country." AARP is collaborating with legislators on reforms, including transaction limits, refund options for fraud, and mandatory customer service. A prior bill, House Bill 1277, aimed to cap deposits at $1,000 but stalled in the Senate. Rep. Scot Matayoshi, the committee chair, plans to introduce legislation next year banning crypto purchases via ATMs altogether, while allowing withdrawals.
Representing CoinFlip, Jon Turke argued that kiosk scams represent less than 3% of cryptocurrency fraud, per an FBI report, with most occurring online. Financial experts like Joely Chung from First Hawaiian Bank advise verifying suspicious calls directly with the bank using numbers on cards, not provided contacts. Amon-Wilkins added: "If you receive a phone call instructing you to deposit money or transfer money or anything like that, if you’re not able to 100% verify who the caller is... don’t do it."
