"Cryptocurrency Kiosk Fraud Prevention Act Takes Effect on October 1, 2026"

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Research, not advice. Part of the Bitcoin research archive (October 2026). Claims labelled unverified, contested or fringe are reported, not endorsed; statuses of bills and rules are as of the date checked. Government, court and patent records are public domain; the research notes are CC BY 4.0.

ALABAMA SECURITIES COMMISSION
                          Post Office Box 304700, Montgomery, Alabama 36130-4700
                      Telephone: (334) 242-2984 or 1-800-222-1253 Fax: (334) 242-0240
                         Email: [email protected] Website: www.asc.alabama.gov

           Cryptocurrency Kiosk Fraud Prevention Act Takes Effect on October 1, 2026
Montgomery, Alabama (September 30, 2026) – Starting on October 1, 2026, if a new Crypto ATM/kiosk
customer has been fraudulently induced to engage in a cryptocurrency ATM transaction, the operator shall issue
a full refund for the transaction, as well as all fees incurred through the transaction. If an “existing consumer”,
as defined in the act, has been fraudulently induced to engage in a cryptocurrency ATM transaction, the operator
shall issue a refund for one-half of the value of the transaction, plus all fees incurred through the transaction.
The customers must complete all of the following to receive the refund:
   •   Contact the operator not more than 60 calendar days after the transaction.
   •   Contact a law enforcement agency, as well as the Alabama Securities Commission (ASC), not more than
       60 calendar days after the transaction.
   •   File a report with a law enforcement agency or the Commission regarding the fraudulently induced
       transaction.
The Act reduces criminal activity through cryptocurrency ATMs by imposing transaction limits, refunding fraud-
related transactions, providing a dedicated United States-based customer service line, imposing penalties for
noncompliance, and requiring enhanced disclosures and warnings. Specifically, the cryptocurrency ATM
operator must disclose information to help customers recognize whether they are victims of a fraud or scam,
and prompt users with questions designed to put users on notice of potential frauds. Operators must display all
fees collected by the ATM operator, the total amount in both cryptocurrency and US dollar value, the exact US
dollar amount of the transaction, and the exchange rate for the cryptocurrency and the cryptocurrency charged
to the customer. To mitigate fraud, cryptocurrency ATM operators cannot execute a transaction if a “new
consumer”, defined in the act as a consumer’s first transaction and 30 days following the first transaction, has
made more than $1,000 in transactions in a single day or more than $10,000 in a month.
“ATMs are traditionally used to withdraw money. If someone is directing you to deposit money into a crypto
ATM, you are likely being scammed,” said ASC Director Amanda Senn. “The amount of money lost to fraud is
staggering and shocking, and the consequences are always devastating. The Act will not eliminate fraudsters'
attempts to steal money, but it will minimize the financial losses through additional protections and refunds.”
Crypto ATMs are increasingly being exploited by scammers and fraudsters because they allow immediate,
irreversible transfers of funds into digital wallets that are hard to trace, much less recover. Fraudsters reach out
by phone, text, email, or other messaging platforms, posing as a government official, law enforcement, a
prospective significant other, a bank representative, a financial professional, a medical professional, a charitable
worker, etc. Most scams present the victim with an urgent issue that requires them to pay quickly, such as paying
to dispose of fake outstanding warrants. Victims of romance scams are also often directed to crypto ATMs to
transfer funds to their fake romantic interest. In these cases, fraudsters build trust with victims and then fabricate
scenarios where victims are often threatened and then later even blackmailed with threats to make personal
information public in order to get the victim to give money. These scammers frequently target seniors because
they are more likely to be affluent or vulnerable.
The ASC thanks Representative Russell Bedsole of House District 49 for sponsoring the bill and the Alabama
Legislature for their concerted effort in ensuring passage of the Cryptocurrency Kiosk Fraud Prevention Act
during the 2026 Alabama Legislative Session.
Anyone who suspects that they are a victim of cryptocurrency fraud should contact the ASC at 1-800-222-
1253.
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                 For further information, contact 1-800-222-1253 and ask for Public Affairs.