S.Amdt. 4348

The amendment submitted by Mr. Durbin aims to add a new section to the law focused on Crypto ATM Fraud Prevention. Its purpose is to establish strict regulations for people who own, operate, or manage virtual currency kiosks in the United States and its territories to protect consumers from fraud.

The amendment seeks to add the following requirements:

• Registration and Oversight: Kiosk operators must register with the Secretary of the Treasury and provide updated lists of all their kiosk locations every 90 days. They must also submit a written anti-fraud policy to FinCEN and employ a qualified, full-time compliance officer.

• Customer Protections and Disclosures: Before a transaction, operators must provide clear warnings about fraud (such as impersonation of government officials), disclose that virtual currency is not backed by the U.S. Government, and provide the exchange rate compared to the global marketplace.

• Operational Restrictions:

  • Transaction Limits: New customers are limited to $1,000 in a 24-hour period and $5,000 total. Existing customers are limited to $2,000 in a 24-hour period.
  • Verification: For new customers spending $300 or more, operators must obtain verbal confirmation via a live phone or video call.
  • Freezes: A 48-hour transaction freeze must be placed on all transactions for new customers during their first 14 days.

• Accountability and Refunds: Operators must provide physical receipts and establish a refund process for victims of fraud. Those who knowingly deny a valid refund can be held liable for 3 times the refund amount or $10,000.

• Enforcement: The amendment mandates the use of blockchain analytics to stop transactions to known fraudulent wallets and sets a civil penalty of $10,000 for each violation of these rules.