Mayor Leirion Gaylor Baird is proposing a new ordinance to protect older residents from becoming victims of cryptocurrency fraud. It would require all businesses operating or providing access to cryptocurrency ATMs to post written notices warning consumers of the potential fraud risks associated with using the machines.
Gaylor Baird says local data indicates that cryptocurrency ATM fraud disproportionally targets older adults. “Cryptocurrency scams may be prevalent, but falling prey to them is preventable. This proposed ordinance shows how we can work together locally to safeguard seniors from financial fraud and stop scams before they start.”
LPD Police Chief Michon Morrow says they began tracking cases of fraud involving cryptocurrency in 2021 and so far there have been 426 cases of all types of fraud, not just the cases related to ATM scams. She says losses have totaled $11.1 million. The average age of fraud victims in those cases is 56 and 42% of them are age 65 or older.
Morrow says LPD has created a new position within its Technical Investigations Unit to specialize in cryptocurrency fraud investigations. “That new position will be a valuable addition as we prepare to implement the proposed City ordinance,” Morrow says. “We will engage directly with local businesses that operate crypto ATMs to provide guidance on posting the required warning signage to their kiosks.”
Cryptocurrency kiosks look like traditional ATMs and are typically located in gas stations, convenience and grocery stores and malls. There are about 40 machines in in Lincoln, about 200 in Nebraska and about 45,000 nationwide.
The ordinance is scheduled for first reading before the City Council October 27. A second reading and public hearing is scheduled for November 3. A third reading and vote on the ordinance is scheduled for November 17.
If the council approves the ordinance, it would take effect January 16.