Stillwater City Council Approves Ordinance to Ban Cryptocurrency ATMs
STILLWATER, MN — The Stillwater City Council has enacted a decisive measure aimed at combating financial scams by banning cryptocurrency ATMs within city limits, following reports that local residents have lost significant sums to fraudsters.
City officials reported during the council meeting that residents had fallen victim to scams totaling approximately $250,000. Police Chief Brian Mueller emphasized the urgency of the situation, noting, "There is another quarter million dollars that was asked for with individuals trying to scam people, but the residents didn’t end up giving them the money."
Background on the Scams
The scams typically involve individuals receiving threatening communications through phone calls, emails, or text messages. Scammers pose as representatives from various organizations, claiming that the victims owe money that must be paid immediately. In many cases, victims are coerced into withdrawing cash from their banks and directing those funds to cryptocurrency ATMs to complete the transaction.
While the ATMs themselves function legally for the exchange of cash into cryptocurrencies like Bitcoin, their presence has become a “tool for scammers,” according to city officials. This concerning trend prompted the police department to consult with the city attorney’s office on ways to effectively tackle the issue.
Ordinance Details
In response to the ongoing issue, the Stillwater City Council drafted an ordinance to prohibit the operation of cryptocurrency ATMs. The ordinance was passed unanimously on Tuesday evening and will take effect on Friday, April 18.
Mayor Ted Kozlowski stated that the council is not alone in its concerns, as several other communities in Minnesota and Wisconsin have reached out for guidance regarding similar issues with cryptocurrency ATMs.
Broader State Context
Consumer Action Division lead Parker Maertz from the Minnesota Attorney General’s Office noted that similar complaints are prevalent statewide, with the office receiving nationwide reports of scams involving cryptocurrency. "We have received reports from all four corners of the state,” Maertz said, underscoring the challenge of recovering losses after the funds have been sent.
In an attempt to curb these issues, a law was passed last year that imposes a daily transaction limit of $2,000 on cryptocurrency ATMs. However, scammers have reportedly found ways to circumvent these restrictions, leading authorities to advocate for further measures.
Local ATM Responses
Investigations into local cryptocurrency ATMs revealed that some machines display warning messages, advising users to reconsider transactions. Yet, both Chief Mueller and Maertz highlighted that such warnings often go unread as victims typically act out of distress and fear.
“I think that eliminating these machines from our community just eliminates one more step for these individuals to be taken advantage of,” Chief Mueller remarked, reinforcing the rationale behind the new ordinance.
As the ordinance moves forward, local officials will remain vigilant to protect residents from the growing threat of cryptocurrency scams, and other communities may soon follow Stillwater’s lead in considering similar regulations.
For real-time updates, Stillwater residents are encouraged to stay informed through local news channels and city government communications.
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