Diane Reynolds said she was blindsided when someone contacted the Maryland retiree online and said they were accessing her computer for security reasons.
“What followed was a voice message that said, 'Don't turn your computer on, don't turn your computer off,'” she told CBS News.
Reynolds was also instructed to call a phone number she believed could provide her with technical support. Instead, she connected to fraud She claimed hackers had gained access to her bank account. The person told Reynolds the only way to protect her money was to convert the funds into Bitcoin.
She withdrew her entire bank account balance, totaling $13,100, and followed the scammer's instructions to a Bitcoin ATM at a nearby gas station. The ATM is operated by Athena Bitcoin, which has more than 4,000 such terminals in the United States
Washington, D.C. Attorney General Brian Schwalb said incidents like this highlight the surge in cryptocurrency scams associated with Bitcoin ATM providers, resulting in millions of dollars being stolen.
“Bitcoin ATMs are tools used by scammers and criminals to swindle people, including Washington, D.C. residents, out of their hard-earned money,” Schwalb told CBS News. “Athena, as a Bitcoin operator, knew its kiosks were being used by this element, but [has] Failure to put in place appropriate anti-fraud prevention systems to prevent this from happening. “
He added, “What's worse is that they are profiting from it because they charge very high fees.”
Schwab filed a lawsuit against Athena in September, accusing it of “charging undisclosed fees on deposits that it knew were often fraudulent and failing to implement appropriate anti-fraud measures.”
Athena Bitcoin said in a statement to CBS News that it “strongly disagrees with the allegations” and will contest them in court.
“We employ aggressive security protocols to protect our customers' financial interests,” the company said. “…Our kiosks employ a variety of protections, from prominent warnings and daily transaction limits to five separate verification screens designed to block forced transactions.”
Reynolds also sued Athena Bitcoin. Her lawyer, Vaught Stewart, accused the company of “not only allowing the fraud to occur, but profiting from it.”
Schwalb alleges in the lawsuit that in Washington, D.C., Athena Bitcoin charges fees of up to 26% on each transaction, and that 93% of all deposits made through the company's ATMs are related to fraud.
Reynolds, for her part, wants to help others avoid losing their savings. “Now I advocate telling people this is true,” she said. “Be careful.”
Financial scams related to Bitcoin ATMs is risingAccording to the Federal Trade Commission.
The Better Business Bureau lists cryptocurrency-related fraud as one of the most common types of financial scams, noting that fraudsters tend to target older adults.
According to the organization, messages from unknown sources claiming that your computer has been hacked is a big clue that someone is trying to trick you.
Edited by Alan Shelter