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Floor Speech
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Mr. DURBIN. Mr. President, last month, the Senate voted to proceed to the GENIUS Act, a bill that would regulate the type of cryptocurrency called stablecoins. Stablecoins are supposed to tie the value of crypto to the value of a dollar, but in 2023 alone, stablecoins differed from the value of the dollar more than 600 times.
Not only are stablecoins and cryptocurrencies volatile but the industry has a reputation for scams and fraud. The Federal Bureau of Investigation, the FBI, recently reported that last year, 2024, crypto- related crime was up 66 percent, and Americans lost--now get this--$9.3 billion to crypto's scammers. Nearly 150,000 complaints were filed following crypto fraud, including more than 6,000 in my home State of Illinois.
How does it work?
Your mom's at home, and in comes a phone call, and the person on the phone call says: Mrs. D, I work for ``so-and-so''--usually a government Agency--and I am calling you to alert you that you missed your jury duty this month. You were supposed to show up to the courthouse to serve on a jury, and you didn't show up.
Of course, your mom knows nothing about that, and says: I didn't see that I was supposed to be there.
Yes. The legal notice was sent to you, and now a fine is going to be imposed on you for your failure to show up for jury duty.
Oh, my. How much?
Five thousand dollars. You can pay that fine, and you don't have to go to trial.
Well, how am I going to pay that fine?
You are going to go to the local grocery store--at the exit--to an ATM, a crypto ATM machine.
How many of those do we have in the United States? We have 30,000 crypto ATM machines. You may not have noticed them in the store, but as you are checking out many times, there they sit. And what is your mom supposed to do when she goes to this grocery store, to the crypto ATM machine? She is supposed to deposit $5,000--and sometimes much, much more--into this machine so that she is buying a stablecoin, but she doesn't get the stablecoin. She directs it to the wallet of the scammer. So she is out $5,000 or more, thinking that she is paying a fine to avoid a trial and because she didn't show up for jury duty she didn't know anything about.
Does that sound preposterous? It is not. It happens over and over and over again. These crypto ATM machines are the vehicles that are used for defrauding people--primarily, senior citizens--to put in thousands and thousands of dollars, and you never get any pennies back because it is all phony; it is all a scam. More than a third of all filed complaints involving crypto fraud were filed by Americans over the age of 50. Many of these scams were facilitated using these crypto ATM machines.
You may be wondering what a crypto ATM is. You pass by them at the store, your place of business, and you may not have noticed them, but they are there. They are located at a local grocery store or a gas station and look like a normal ATM machine except they allow customers to deposit cash to purchase cryptocurrency, including stablecoins. They can ruin someone's life in an instant. Many times you don't hear about it because your mother, having been scammed over the phone and deposited thousands of dollars of her life savings, is too embarrassed to tell you.
In fact, seven of the largest crypto ATM operators sell these stablecoins. These crypto ATMs become a favorite tool of scammers because, once a victim purchases crypto and transfers it to the criminal's digital wallet, it can be virtually impossible to trace or to retrieve. These scammers follow the same playbook. They call up an unassuming victim, pretending to be from the victim's bank, tech support, or some government Agency. They impersonate government officials.
Just fair warning--and I say this because we receive a lot of calls in the office about scammers on the phone--major Agencies of the Federal Government are never going to call you on the phone--the IRS, Social Security, and such. They send written notices, and they should. So, if it is a fast-talking person on the telephone who says they are from a Federal Agency, be careful.
They may tell the victim they owe money for skipping jury duty or need to pay bail to get their child or grandchild out of jail. It happened in my family--exactly that scenario. Or they may tell the victim there is fraudulent activity on their bank account or computer. It happened to me one night. My cell phone starts ringing. I answer it, and this fellow says he is from my credit union. He wanted to question a transaction, and I am thinking: I have never had my credit union call me ever. What is that all about? Well, after a while, I was dubious, and he hung up on me. The victim, however, often doesn't realize fraudulent activity is even occurring. Meanwhile, they scramble to figure out what to do, and the scammer tells them: You can just pay the fine at the crypto machine, and here is where to go to use that service.
Through it all, the scammer runs them through everything they need to know to take their life savings, thousands and thousands of dollars, and to insert it as cash into this machine--this crypto ATM machine-- sometimes hundreds of thousands of dollars. They purchase cryptocurrency and send it off to the scammers' digital wallet, never to be seen again.
Once that happens, the money is gone. There is no way to get it back, and there is little hope in tracing the transaction to the actual scammer.
These types of scams led to nearly $247 million in losses last year, a 31-percent increase over the previous year, and the crypto ATM companies know their kiosks facilitate this fraud.
I am not a big fan of vaping, but I do want to say this. There is a vaping store in my hometown of Springfield, IL, that finally despaired of all of the older people who came in in tears, shoveling money into the crypto ATM machine. The owner of the premises was given $300 a month for allowing crypto ATM machines in his business, but he couldn't take it anymore. Too many people were clearly being scammed, and he was party to it. And he had it removed.
A large crypto ATM operator, Bitcoin Depot, wrote in its filing with the Securities and Exchange Commission exactly what I have said. They said:
Our products and services may be exploited to facilitate illegal activity, such as fraud, money laundering, gambling, tax evasion, and scams.
That is as close to a confession as you can get.
The SEC filing, though revealing, doesn't give the whole picture. It doesn't tell the actual human story.
Imagine a person who is retired, up in years, worried day to day whether their Social Security check is going to stretch far enough, and now loses thousands of dollars in their life savings to the scam.
In Illinois, an elderly woman with MS lost $40,000, her entire life savings, to a government grant imposter scheme facilitated by a crypto ATM. Since the woman can't get around very well--listen to this--the scammer called an Uber to pick her up and drive her to the local crypto ATM--how kind to drive your victim straight to the crime. They took her personal information as well. She is devastated, since this is all the money she has been able to save in her entire life, and there is no way to recover it from the crypto ATM.
Elaine, a 76-year-old woman from Florida, was a victim of crypto ATM scam after her late husband's death. She looked up the Apple support number to try to secure his Apple accounts, but, unfortunately, the number she called was an imposter. The criminal convinced her that she was the victim of identity theft and told her to immediately take $30,000 out of her bank account and deposit it into a crypto ATM. Now she is recovering not only from her financial loss but also from the loss of her husband.
Many States, including Minnesota, Iowa, and North Dakota, have decided to make a move, since Congress has not. They have passed State legislation to try and crack down on those crypto ATM scams. Just a few days ago, I am happy to report, my home State of Illinois passed a similar State law.
Now, it is time for Congress, because 13 States have acted, to learn something from their example. We must act so that all Americans know the risk of crypto ATMs and have proper documentation when seeking help from law enforcement to try to get their hard-earned cash back.
That is why I am pushing for a vote on my amendment to the GENIUS Act, which would create commonsense guardrails to prevent crypto ATM fraud and empower law enforcement to combat these scams. My amendment would require crypto ATM operators to register with the Federal financial regulators, provide warnings to customers about scams, and create daily transaction limits so customers cannot lose their entire life savings in an instant.
With my amendment, crypto ATM operators would not be able to simply turn a blind eye to the fraud that is happening at their crypto ATM machines. We must put an end to these scams.
I urge my colleagues on both sides of the aisle to support my amendment to stop scammers in their tracks and provide protections for people whom they represent.
I want to say a word to the industry. You have 13 States now that are trying to do what we should do on a national basis. Let's establish this national Federal standard that applies in every State in the Nation to protect people from this exploitation that is clearly growing in intensity by the day. Let's protect senior citizens and many others who have been scammed using crypto ATM machines.
Cryptocurrency has its detractors, and it has its champions, but I hope we can all stand together on a bipartisan basis to say that we are not going to help scammers steal money from unsuspecting people.
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